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HMRC to extend payment period for customs and import duty due in May

5 May, 2020
Posted by: William Barns-Graham
Trade News

This article was published before we became the Chartered Institute of Export & International Trade on 10 July 2024, and this is reflected in references to our old brand and name. For more information about us becoming Chartered, visit our dedicated webpage on the change here.

duty deferment

HMRC will extend the payment period for customs and import duty currently due on Friday, 15 May.

This is a repeat of the extension made last month for businesses experiencing cash flow issues due to the coronavirus pandemic.

As with the April extension, businesses will need to actively apply for payment deferment.

Last week HMRC also announced it was temporarily waiving VAT on all purchases – including both domestic and import – of PPE, in sectors beyond healthcare to help facilitate a return to workplaces.

Important for importers

HMRC has advised that Duty Deferment Account holders can contact HMRC to approve an extension for making full or partial payment - without having their bank guarantee called upon or their account suspended.

Those who do not currently hold a Duty Deferment Account will need a bank guarantee to apply for one. More information on how to apply can be found here.

Kevin Shakespeare, director of stakeholder engagement for the IOE&IT, said the extension would be a boost for businesses importing goods and those involved in supply chain operations.

He told the Daily Update he hopes HMRC can go one step further to automatically defer import duty and VAT on a wide range of goods.

This would help a broader range of companies grappling with the impact of the pandemic, particularly SMEs who do not currently possess deferment accounts and who may struggle to attain a bank guarantee to apply for one.

HMRC have provided FAQs below about the extension. You can view the answers here.

Frequently Asked Questions

  • How can duty deferment users request a payment extension?
  • Can duty deferment users continue to use their duty deferment accounts while payment remains outstanding and if so, will they need to increase their guarantee?     
  • Will HMRC charge interest on these outstanding payments?
  • Can duty deferment users request a payment extension if they think it will help ease cash-flow concerns while the COVID-19 measures remain in place?
  • How do you assess whether duty deferment users are suffering genuine financial difficulty as a result of COVID?
  • Will the payment deadline extension apply to payments due on 15 June?
  • Do these arrangements apply to payments of deferred excise duty?
  • What about businesses who pay their customs duty/import VAT through a duty deferment account held by their customs agent?

A full range of business support measures have been made available to UK businesses during coronavirus (COVID-19).

More information is available here.