Temporary Import Solutions for UK Businesses: A Practical Guide to Duty and VAT Savings

For importers, customs duty and VAT are unavoidable business costs. But there are fully legal customs procedures that can reduce or delay duty payments, improving cash flow. Below are three duty minimisation strategies, including special procedures for goods entering the UK temporarily before re-export.

Get the big picture: What is UK Customs Clearance? Everything you need to know.

What are Customs “Special Procedures”?

HMRC's "special procedures" let businesses suspend, reduce, or claim relief from customs duties and import VAT. While these require HMRC authorisation and careful record-keeping, the savings can be significant.

Does duty deferment save money? Whilst you pay the same total amount of duty and tax, the ability to defer payment and streamline operations provides tangible financial advantages for businesses, particularly those that import goods regularly. The financial flexibility and improved cash flow are the primary "cost-saving" elements.

— David Merrit, Director of Trade Consulting Europe & Asia
Strategy 1

Customs Warehousing

Store goods in a secure "customs warehouse" without paying duty or import VAT until sale in the UK.

Procedure

Import goods directly to a bonded warehouse, suspending duty during storage.

Ideal for

Businesses importing bulk stock over time, or those planning partial re-export to avoid UK duty.

Strategy 2

Inward Processing

Inward Processing (usually called Duty Drawback in North America) lets you import goods for processing or repair without duty and VAT, if you are re-exporting afterward.

Process

Get IP authorisation, import raw materials, create finished goods (e.g., assemble electronics, make clothing), then export.

Ideal for

UK manufacturers, repair centres, and international assembly operations.

Strategy 2

Inward Processing

Inward Processing (usually called Duty Drawback in North America) lets you import goods for processing or repair without duty and VAT, if you are re-exporting afterward.

Process

Use an ATA Carnet, a “passport” for goods, to simplify temporary customs clearance across countries.

Common Uses

Exhibition goods, project equipment, auction items, and temporary tools.

Case Study

Inward Processing for Major Commercial Aviation Supplier

Our experts were able to save a leading aviation company tens of thousands of pounds in duty by ensuring their processes fully followed the FAA’s stock control auditing guidelines.

In practice, our client felt that it was an additional administrative burden whereas in reality, it was just one extra tick-box on an Enterprise Resource Planning (ERP) system.

This major European supplier of parts for multiple airlines had failed an audit by the authorities and was in danger of losing beneficial duty wavier programs.

  • The audit by customs identified violations of EU Regulations for goods held under customs control.
  • The company was subjected to enforcement actions initiated by the customs authorities including the payment of penalties.
  • The company which is not based in the E.U. faced an internal lack of regulatory knowledge to manage complex E.U. regulations and manage the risks, robust processes to provide transactional compliance and Part HT Classification expertise.

What we did

Our Global Trade Management experts delivered

  • day-to-day operational process and procedures,
  • parts classification,
  • regulatory awareness training at senior and desk levels,
  • specific guidance to identify compliance enhancements, and implement processes to mitigate risk in their import and export activities.
Our services supported the company in
  • the identification of regulatory gaps,
  • the development and management of a regulatory compliance gap closure program, and
  • the mitigation of the penalties issued, and actions required by the customs Authorities.
Our import and export transaction auditing

ensured that the business continued on a path of continuous regulatory improvement.

The Results

Our trade experts created a scalable and robust trade compliance model to support the company's business, whilst effectively complying with international import and export regulations, minimising duty payments and exposure to further costly penalty actions.

The company’s staff were aware of regulatory controls and reporting requirements, providing repeatable cost effective (Duty Wavier) shipments.

Understanding Your Obligations

To benefit from these procedures, accurate valuation, classification, and record-keeping are vital. Financial gains can be significant but depend on strict compliance.

It begins with accurately calculating potential duties.

Consult our Practical Guide to UK Customs Duties, Tariffs & Import VAT.

What’s Your Strategy for Minimising UK Import Duties?

Duty minimisation is about strategic planning, not tax avoidance. It uses official customs procedures to improve financial efficiency. Each procedure requires careful setup and management.

Is your business eligible? Contact our customs specialists for a free import strategy assessment.

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