Whilst the VAT paid at importation is usually recoverable on the VAT return, other charges are not, so any mistake made will affect the bottom line. Furthermore whilst HMRC can raise assessments for underpaid import duty it is much more difficult to recover overpaid duty.

Information about importing can be found on the HMRC website at hmrc. gov. uk/businesses/ Get your tariff right Imported goods are classified using a ten-digit "commodity code", which is entered on the import declaration. There are approximately 65,000 commodity codes.

All goods - no matter how obscure - will have a commodity code. Codes are internationally agreed and "describe" goods for customs purposes, determining both the duty payable and any restrictions that apply to the goods.

Getting the code wrong will result in the wrong amount of duty being payable.

You can check the com-modity code at http: // europa. eu. int/comm/taxation_ customs/dds/en/tarhome. htm There are also HMRC classification guides for certain products at uktradeinfo. com/ index. cfm? task=classindex Guidance from HMRC can be found in Notice 600.

Get the value right Import duty is chargeable on the cost, insurance and freight "open market" value of shipping the imported goods to the port of importation. This value must be adjusted to take into account costs such as royalty and licence fees and materials supplied free of charge to the manufacturer, which must be added to the import value while buying commission and post importation transport costs can be deducted from the import value.

The value will not be accepted as an open market value if the importer is "related" to the seller and the relationship affects the value. A special valuation method may therefore need to be agreed. Getting the value wrong will result in the incorrect amount of duty being payable.

Guidance from HMRC can be found in Notice 252.

Claim preferential rates Many developing countries or countries in the process of joining the EU have preferential trade agreements with the EU.

Under these agreements goods that meet the specific origin rules can be imported into the EU at a reduced or nil rate of duty, provided a valid preference certificate issued in the exporting country is obtained and submitted with the import entry.

HMRC may check preference documents if they suspect that the origin rules have not been met. If the documents are subsequently found to be incorrectly issued, additional duty and penalties may be payable.

Some preferential duty rates may be subject to a "tariff quota". This is a pre-set value or quantity of goods that may be imported into the EU during a specified period at a reduced rate of duty. When the quota is exhausted the full rate of duty will be payable.

Check out import restrictions A number of goods need a licence before they can be imported into the EU.

Licensable goods include: a) "sensitive" goods from countries where the EU wishes to control and limit quantities or values imported - Depart-ment of Trade and Industry licence;

b) certain ozone depleting substances - European Commission licence; c) certain timber and forestry products - Forestry Commission Licence;

d) certain radio transmission equipment - Office of Communications licence.

If a licence is needed and is not presented at the time of importation, the goods cannot be released from HMRC control. Failure to apply for a licence before the goods arrive can therefore delay importation and increase port storage charges.

Customs duties, import VAT and other charges payable at import must be paid or deferred before the goods can be removed from HMRC control.

Apply for deferment account Payment may be made to HMRC direct although many importers make payment through their import agent who will use a duty deferment account.

A duty deferment account is a trade facilitation measure, which can defer payment of duties and VAT payable at import by between two and six weeks and speed up the importation process. Importers have a monthly credit limit.

Once approved by HMRC a deferment approval number (DAN) is given and instead of paying the agent the charges due at import, importers need only quote their DAN on the import entry.

HMRC will then debit the designated bank account on 15th of the following month for the charges payable.

Importers must give HMRC a financial guarantee for the maximum expected charges due in a calendar month.

Guidance from HMRC can be found in Notice 101.

For approved simplified import VAT accounting (SIVA) import-ers the guarantee required for duty deferment will be based on the duty and other charges payable excluding the VAT element.

SIVA approval therefore reduces the cost of operating duty deferment.

Guidance from HMRC can be found on the HMRC website.

Check import duty reliefs There are a number of schemes that relieve, or delay payment of, import duty and/or VAT on goods that are permanently or temporarily imported in certain circumstances.

Relief is claimed via a special customs procedure code on the import entry. Common reliefs are: a) inward processing relief - goods imported for processing/ repair and re export; b) temporary imports - goods for exhibition etc; c) returned goods relief for goods being returned to the original supplier.

Guidance as to the scope and nature of reliefs available can be found on the HMRC website.

Import entry Make sure you receive a copy of the import entry after acceptance by HMRC and check that the details declared to customs are correct The agent should provide a copy of the import entry form C88 or a plain paper version.

The box numbers shown on the plain paper C88 will correspond to the printed version of the form which can be downloaded from the HMRC website. It is important to check that the details declared are correct.

If the wrong value or commodity code has been entered by the agent the importer will still be liable for any errors. If duty has been overpaid it may still be possible to rectify the error if HMRC is notified quickly.

David Gough is a VAT and duties consultant at tax consulting firm Chiltern plc.