What is it?
TSP was announced with some fanfare at the beginning of February. Transitional Simplified Procedures is a solution designed to make it easier for goods to be imported from the EU if the UK leaves without a Brexit deal on the 29th March 2019.
TSP is limited to roll on roll off (Ro-Ro) transit port locations, and is only for traffic from the EU 27
How does it work?
TSP allows a registered Importer to lodge a simplified frontier declaration to clear goods from the EU arriving at a designated Ro-Ro Port. Goods can theoretically flow freely, as the Importer is required to make a full (supplementary) Import declaration at a later date, by the end of the fourth working day of the following month. Payment of Customs duty is deferred too.
The process for accounting for import VAT will also change so that businesses will be able to pay import VAT on the next VAT return, rather than when goods arrive at the border, allowing for import VAT to be declared and recovered on the same return.
The proposed new procedures are intended to ease the burden for businesses importing goods through certain ports and it is advised by HMRC that TSP is applied for in preparation for a no deal scenario
How do companies Register?
The registration criteria is as follows, companies must:-
- Be established in the UK
- Have an EORI number https://www.gov.uk/eori
- Be importing goods ‘in free circulation’ in the EU into the UK after 29th March 2019
Registration can be made on line by following this link:-
https://www.gov.uk/guidance/register-for-simplified-import-procedures-if-the-uk-leaves-the-eu-without-a-deal
Sounds too good to be true?
It may be. We have a number of concerns, and questions for which we are seeking clarification from HMRC.
Principally it does not appear possible to combine TSP with ‘Transit goods’. It means that importing mixed loads of groupage with only part of the load comprising TSP clients may not be possible.
Additionally, its important understanding the administrative cost and time implications of implementing TSP. In using this process it means there are 3 separate customs processes required per import (initial declaration, Frontier Declaration and final clearance), whereas a standard customs clearance takes place once at the border, or in Davies Turners case at one of our 5 inland clearance depots, at which point duty & VAT is payable.
Only time will tell, but it may be that this is a solution suited to regular Importers of full loads for example.
What should clients do?
TSP application costs nothing. Once granted you don’t have to use it, either every time or at all.
Whether it is a simplified process remains to be seen, but it does no harm to apply and therefore should form part of your Brexit planning.
Therefore, our advice to clients for the moment is to
apply for TSP immediately to be sure this is an option available to you in the case of a ‘no deal Brexit situation, either from 29th of March or at any point in the future.