Insights

MHA secures HMRC approval for Inward Processing, empowering client success

Name: MHA
Price range: $

Andrew Thurston · October 4th 2023 · read

Client Case Study

A UK based client is exporting goods to the EU as part of a service contract. The goods are used and returned to the UK for washing. As part of the contract, replacement goods are exported.

The Challenge

Due to Brexit, all movements from Great Britain to the EU became subject to customs controls which made the movement of goods more difficult, especially when there is no sale.

The Solution

As the goods remained the property of our client, MHA’s Indirect Tax Team were employed to review the potential options to manage the customs processes and minimise the risk of unrecoverable duties and VAT.

A review of the supply chain to the EU was swiftly completed. It was confirmed that the only option available, to waive the requirement for the annual £20,000 of import duties, was to use Inward Processing. Outward Processing was to be used to export the goods from the EU but this was to be arranged by the customer. Advice was provided to facilitate this process and reduce the risk of errors.

MHA assisted our client with reviewing its internal controls and providing upskilling to staff so that an Inward Processing application could be submitted to HMRC. Procedures were amended and a new customs compliance process was developed to ensure the client could evidence its compliance with IP regulations.

As a result of the work completed by MHA, our client was successfully approved by HMRC for Inward Processing and used the procedure to manage its contract with its Irish customer, whilst submitting accurate data to HMRC to meet its IP obligations.