Returned Goods Relief (RGR) is a customs procedure that enables an exporter to gain total or partial relief from customs duty and tax for goods which are being returned. This could apply to such scenarios as customer returns or cancelled orders after the goods have been despatched.
For a company to be eligible to claim RGR they must be able to provide the original proof of export. This is to prove the goods are indeed returned goods and not some attempt to avoid paying import duty. If the proof of export cannot be provided then duty will be applicable as usual.
UK-EU returns and the brexit problem
When the UK was in the EU it benefitted from the free movement of goods, this causes a big problem with the post-brexit UK-EU RGR procedure. Pre-January 2021 UK exporters could freely export their goods from the UK to the EU, shipping to Berlin was as simple as shipping to Bolton. Therefore, these exporters may not have any proof of export as it was previously not required. So, potentially all returned shipments after January 2021 have no proof of export and simply cannot qualify for RGR…
Keeping it simple
Due to this problem, the UK and EU agreed the RGR procedure should be simplified temporarily to allow for this gap in evidence. Therefore the need for proof of export on UK-EU shipments has been removed until 30th June 2022. The agreement is reciprocal so both the UK and EU can benefit from the simplified procedure.
Which goods are eligible for RGR?
As per government notice 236, to be eligible for Returned Goods Relief the goods must be re-imported in an unaltered state, apart from any work that may have been carried out to maintain the goods in working order, the goods cannot have been upgraded to increase their value. To claim the relief on the import VAT, the exporter and importer must be the same person.
The goods must also:
- have been in free circulation in Great Britain or Northern Ireland when they were exported, unless they were originally declared to inward processing (IPR) or end-use
- not have been exported to be repaired or processed, if they were but the repair or process was not carried out, relief may still be available
- be re-imported within 3 years of their export, shorter periods apply to goods which benefitted from agricultural measures at export (doesn’t apply to simplified procedure above)
As always, ensure you have the correct commodity code(s) for the goods and double check any licensing requirement.
How do I apply for RGR?
If you are using an intermediary, such as a freight forwarder or courier, you can advise them of the RGR status when you advise the customs clearance instructions. Be sure to provide all the required original export evidence, such as the original export invoice and copy export entry (unless using the UK-EU simplified procedure above). Be sure to advise if you require duty and VAT relief or just duty.