Duty Deferment Approval Criteria

 

1. Legal Provisions

The provisions for managing the revenues of HM Customs and Excise, through the operation of the Duty Deferment Scheme, are set out in the following legislation:-

  • Customs and Excise Management Act 1979 - Sections 6(2) and 45;
  • Council Regulation (EEC) No. 2913/92 (The Community Customs Code) – Articles 224 – 228 and Commission Regulation No. 2454/93 (laying down provisions for the implementation of Council Regulation 2913/92 establishing the Community Customs Code);
  • Customs Duties (Deferred Payment) Regulations 1976 (SI 1976/1223) & 1978 Amendment (SI 1978/1725);
  • Excise Duties (Deferred Payment) Regulations 1992 (SI 1992/3152);

By applying to operate a deferment account, you (The Deferment Holder) agree to meet the following approval criteria.

More information on these criteria can be found in Notice 101 – Deferring Duty, VAT and Other Charges.

2. Financial Standing

You must have sufficient financial means to ensure all charges deferred during each respective accounting period are paid in full on the due date.

You must notify us immediately of any changes to your financial status by contacting the Central Deferment Office.

3. Payment

You must pay all deferred charges by BACS direct debit. This is the only method of payment that we will accept. If an emergency prevents us from collecting charges in this way, we reserve the right to collect deferred charges by an alternative payment method upon prior notification.

We (HM Customs & Excise) reserve the right to suspend a duty deferment facility if the direct debit instruction is cancelled without a suitable replacement being provided.

We reserve the right to suspend a duty deferment facility that has outstanding payments. You will be given notification of such action.

We reserve the right to charge interest on late payment of deferred customs debts.

We reserve the right to revoke a duty deferment facility that persistently has outstanding payments. You will be given prior written notification of such action.

Where a deferment facility is revoked, you will have the right to appeal against this decision.

You must notify us immediately if your bank details change. You must arrange for your bank to notify us of the new details, and send us a new direct debit instruction, if necessary, at least 10 days before your next payment is due. You must not cancel your previous direct debit instruction until the new one is in place.

If you wish to cancel your duty deferment facility you must not cancel your direct debit instruction until all outstanding deferred payments have been made on the due date(s).

4. Security

You must provide security for all deferred charges in the form of a guarantee from an independent guarantor. The guarantor must be approved by us to provide guarantees for this purpose.

The guarantee provided must be sufficient to cover all deferred charges in any calendar month. You must ensure all deferred charges for each calendar month remain within your guarantee level.

You can apply to have your guarantee level revised at any time by providing a new guarantee or a Notice of Amendment from your guarantor.

We reserve the right to refuse to allow charges to be deferred if your guarantee level is exceeded.

We reserve the right to suspend and revoke a duty deferment facility if the guarantee level is persistently exceeded. You will be given prior written notification of such action.

We reserve the right to suspend and revoke a duty deferment facility if the guarantee is cancelled, or withdrawn, without a suitable replacement being provided.

Where a deferment facility is revoked, you will have the right to appeal against this decision.

If you have approval to operate a reduced security scheme for specific types of deferred tax, you must continue to provide full security for all other deferred taxes (see Section 7 below).

5. Changes

You must notify us by contacting the Central Deferment Office immediately of any changes that affect your duty deferment facility. Namely if:-

  • Your bank account or guarantor changes.
  • Your company name changes - a Certification of Incorporation Upon Change of Name must be provided.
  • Your address changes.
  • Your VAT registration number changes.
  • You cease to trade or if the business is to be carried on by another legal entity.
  • You wish to cancel your duty deferment account.

We reserve the right to suspend duty deferment facilities if changes are not notified to us promptly.

6. Simplified Import VAT Accounting (SIVA)

If you have SIVA approval to operate reduced security for deferred import VAT , you must continue to provide full security for all other deferred taxes.

SIVA approval will only allow you to reduce your deferment guarantee in respect of Import VAT paid through your duty deferment account. You must ensure that the guarantee provided is sufficient to cover your other liabilities at all times.

Where a deferment guarantee is provided, the criteria outlined in Section 4. above must continue to be met.

Where reduced security applies, you must provide a schedule of your anticipated deferred charges per calendar month in order to determine your level of guarantee and set a Deferment Account Limit.

We have final responsibility for determining if your level of guarantee is adequate and reserve the right to refuse any requests for reduction.

We have final responsibility for setting the Deferment Account Limit and reserve the right to revise the limit at any time. This limit will be advised to you in writing.

You can apply to have your Deferment Account Limit revised at any time by completing a new schedule of deferred charges.

You must ensure all deferred charges remain within the Deferment Account Limit for each calendar month.

We reserve the right to refuse to allow charges to be deferred if your Deferment Account Limit is exceeded.

We reserve the right to suspend and revoke duty deferment facilities where Deferment Account Limits are persistently exceeded. You will be given prior written notification of such action.

Where a deferment facility is revoked, you will have the right to appeal against this decision.

You must continue to meet the approval criteria for operating duty deferment and be compliant in all your dealings with us. We reserve the right to withdraw your SIVA approval, and demand full security, at any time if your level of compliance falls.

7. Variations

We reserve the right to vary or revise these approval criteria by prior notification. Where a criterion is added, revised or revoked it will not affect the validity of any of the others.

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