What is the Customs

Declaration Service (CDS)?

New Customs Declaration Service (CDS)

On 1 October 2022, UK imported goods started to be customs cleared via the new Customs Declaration Service (CDS).  The customs clearances of exports will move over to Customs Declaration Service (CDS) after 31 March 2023. HM Revenue and Customs state that Customs Declaration Service (CDS) will provide easily access real-time import and export data, check tariffs and financial statements online, using dedicated digital dashboards.


One of the many changes post-Brexit is that every movement of products in or out of Great Britain involves a customs declaration, as EU countries are now considered ‘Third Countries’ from the point of customs. HM Revenue and Customs have made it very clear that the accuracy of customs declarations via CDS is the responsibility of the importer or exporter and not that of their customs clearance agent, who would normally be acting in the role of a 'direct representative'. 


All UK importing businesses should have registered for Customs Declaration Service (CDS) prior to 1 October 2022 to either make customs declarations themselves or use customs agents that can make import customs declarations for them.


Many importing companies may find they were automatically registered for CDS as part of the process of using the new Postponed VAT Accounting (PVA) for Import VAT, which was introduced post-Brexit. Companies using PVA will already be downloading their postponed VAT statements from the Customs Declaration Service (CDS) financial dashboard on the website.

Case Studies

Replacing the old CHIEF System

The Customs Handling of Import and Exports Freight computer system, known as CHIEF, is being replaced with a new Government digital platform called Customs Declaration Service (CDS). Over the past 30 years, goods have been customs cleared into and out of the UK using the CHIEF computer system. The new CDS platform is being introduced to make customs declarations easier to manage and it was designed (prior to Brexit) to comply with EU customs requirements, as set out in the Union Customs Code.


The New Customs Declarations Service (CDS) has been introduced in a phased implementation. Since 31 October 2021, it has been used for all goods movements from countries outside the European Union. Since 1 January 2021, all declarations for Great Britain-Northern Ireland (GB-NI) movements have been submitted to the Customs Declarations Service (CDS).

Registering for the Customs Declaration Service

How do you subscribe to or check if you have access to the Customs Declaration Service (CDS)?


HM Revenue & Customs (HMRC) state:

You’ll need the Government Gateway user ID and password that you use for:

  • your business or organisation
  • yourself, if you’re applying as an individual

 

You will need to confirm the following with HM Revenue & Customs (HMRC):

  • your Economic Operator Registration and Identification (EORI) number that starts with GB
  • Unique Taxpayer Reference (UTR)
  • the address for your business that HMRC has on their customs records
  • National Insurance number (if you’re an individual or sole trader)
  • the date you started your business

What Information is required by CDS?

To complete a customs declaration within Customs Declaration Service (CDS), your submissions will need to include information from eight data element groups. The new CDS customs declarations will require additional information by certain data elements and the data can be different to the data required by the old CHIEF customs declarations.


These are the eight data element groups required by the Customs Declaration Service (CDS):

  • Message information - Customs Procedure Codes.
  • References - Documents, Certificates and Authorisations.
  • Parties.
  • Value - Valuation Information, Taxes and Incoterms 2020. 
  • Shipping details - Dates, Periods, Places and Countries.
  • Goods identification.
  • Transport information - Modes, Means and Equipment.
  • Other - Statistical Data, Guarantees and Tariff Data.

Payment methods within Customs Declaration Service (CDS)

The Customs Declaration Service (CDS) system provides different ways to process your declaration payments and you can use one of five methods to make your payment.


Cash Accounts

These replace the Flexible Accounting System (FAS) used in CHIEF and all companies that register for the Customs Declaration Service are automatically given a cash account.


Duty Deferment Accounts

A duty deferment account allows you to make one payment each month for any imports, rather than paying every time you import goods.


Immediate Payments

Companies can elect to make the payment at the point of making an import CDS Customs Declaration. This will require a payment to be made on the same day or the next day.


Guarantee Accounts and Individual Guarantees

A customs guarantee is an agreement to cover debts arising from customs duty, import VAT and excise.

Why is CDS being introduced?

HM Revenue and Customs (HMRC) state that they have been developing Customs Declaration Service (CDS) over several years in consultation with the border industry and will provide a more secure and stable platform that has the capacity and capability to grow in line with the government’s ambitious trade plans. The move to one system for all imports and exports will also deliver savings for the taxpayer.

HM Revenue and Customs (HMRC) also state that the Customs Declaration Service (CDS) saves companies time by:


  • giving real time notifications and alerts on all import and export declarations and movements, and
  • allowing companies to manage their business finances by opening a duty deferment account, make payments by card or bank transfer enabling their goods to clear without delay.

Postponed VAT Accounting (PVA)

Postponed VAT Accounting (PVA) was introduced in January 2021. HM Revenue and Customs (HMRC) state that it allows a VAT registered importer to account for the relevant import VAT on their VAT return rather than paying it immediately or through their duty deferment account and reclaiming it as input tax using the HMRC form C79.


Postponed VAT Accounting (PVA) allows a UK VAT Registered trader to notify HM Revenue and Customs (HMRC) of their intention to account for import VAT on their VAT return. Where PVA is notified the VAT amount will appear on monthly VAT statement that the trader will access digitally. They will use the statement to provide them with the amount of import VAT to be accounted for in box 1 of their VAT return and the amount that can be reclaimed as input VAT in box 4 of their VAT return (subject to the normal rules).

Read more about Postponed VAT Accounting (PVA)...

Customs Clearance Blogs & Case Studies

Read my Customs Clearance Blogs and Case Studies to see how I have worked side by side with clients to tackle different customs clearance challenges. In each case, an appropriate solution was identified and implemented to manage imports via CHIEF and the new Customs Declaration Service (CDS).

Get in touch about the Customs Declaration Service (CDS).

Contact me for the most up-to-date information about the Customs Declaration Service (CDS).

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