Customs Civil Penalty Notice

How to avoid HMRC’s Customs Civil Penalty Notice

Do you shudder at the thought of dealing with customs clearance?

Do you struggle to remember what forms need to be completed?

Do you have sleepless nights about misdeclarations?

If you do (and don’t), you need to find a company to take care of all that for you because one false move could cost you dearly.

What is a Customs Civil Penalty Notice?

Let’s start at the beginning. If your business trades goods international or imports or exports goods, you must comply with the European Community rules and national legal requirements.

If HMRC finds a misdeclaration, you could face a Customs Civil Penalties Notice (CCPN).

The CCPN system encourages accurate cargo declarations to ensure the correct VAT and duty are paid.

If it comes to light that you’ve made a slip-up, HMRC can take two forms of action:

  • Issuing a warning letter
  • A financial penalty (up to £2500 per significant irregularity and up to £1000 for less serious contraventions)

What happens if it’s a genuine mistake?

HMRC isn’t out to get you, and understand that mistakes sometimes happen. If, when an error is picked up, HMRC believe it’s a genuine mistake and education is the best response, customs civil penalty action is unlikely.

However, when faced with repeat non-compliance, HMRC will probably issue a Customs Civil Penalty Notice.

Is there any warning before a Customs Civil Penalty Notice?

The first step is the warning letter, which outlines the contravention and gives a specific warning that any similar violations made within two years of the issue of that letter may result in a civil penalty being charged.

It’s important to note that you won’t face a penalty should you discover and voluntarily disclose a contravention.

If the issuing of a CPP is likely, there are defences and mitigating circumstances which HMRC will consider before any CPP is issued.

What is a Civil Evasion Penalty?

There is a second limb to the civil evasion penalty procedure.

If HMRC believes there to be any dishonesty or an intention to evade duty, a Civil Evasion Penalty (CEP) may be imposed.

This can be up to 100% of the evaded duty. However, there are potential reductions available for:

  • Early and truthful explanations (40%)
  • Fully embracing and meeting responsibilities (40%)

It’s important to remember that the Civil Penalties regime doesn’t stop HMRC from exercising additional powers, such as seizing goods and launching a criminal investigation, especially where a tax evasion offence has been committed.

The final word

As you have seen, there are many good reasons why it’s essential to ensure you get your act together when it comes to international trade and importing and exporting goods privately.

Considering the penalties, it seems wise to use a logistics company that can take care of your customs clearance paperwork for you and avoid a Customs Civil Penalty Notice.

Smart Directions provide a bespoke logistics service, ensuring their clients maintain excellent levels of customer service at all times. Call the team on 01442 507 240 to find out more.

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