HMRC recently published CIP (08)53 which advised that the deed of undertaking facility for ERTS Operators is not acceptable as customs security and that a CT Guarantee or Guarantee Waiver is required.

HMRC recognise that an exact calculation of duty and VAT liability for goods transferred to ERTS is difficult to achieve as ERTS operators do not necessarily have access to all of the information required, for example, where consignments are cleared by another Agent.

In order to simplify the calculation, HMRC have agreed a rate per kilo (based on the UK average) that can be used to calculate the level of guarantee required. This is based on the net weight of all freight processed through an ERTS during the required reporting period.

NB. ERTS operators who process a significant amount of high value freight eg. precious metals/stones etc, are not advised to use this method of calculation, but to base the figures on the actual value of the goods.

HMRC have provided a series of Excel spreadsheets that perform this calculation for you. If used electronically, only rows 31, 33 and 35 should be completed as the remaining fields will complete automatically. The EU legislation requires the calculation to be based on a minimum of 7 days. trading based on the highest rates of duties and other charges applicable to the goods. However for movements to, from and between temporary storage facilities customs, as a derogation, are prepared to accept figures for a typical 48 hour period. The import/export statistics will be updated every six months, so the reference amount will be re-visited on a 6-monthly basis. Acceptance of this method of calculation is subject to an initial visit by a local officer and will be subject to an annual review.

ERTS operators that already have a guarantee in place, which is higher than it would be under this method of calculation, can apply to get it reduced. However, priority will be given to new guarantee applications.

Further information can be obtained from the Guarantees Team on the following telephone numbers:
01255 244758 /4766 /4735/ 4894

Rate per kilo for Air Microsoft Excel worksheet

Rate per kilo for Road Microsoft Excel worksheet

Rate per kilo for Sea Microsoft Excel worksheet