Since the UK’s so-called implementation period with the European Union came to an end in 2021, the rules concerning all shipments between the mainland UK and Europe have altered. Some British exporters still don’t understand, however, that they need to take into special consideration the regulations that are in place for shipments heading to Guernsey.
This is because, in common with the other Channel Islands, Guernsey is not a constituent part of the UK. It is part of the crown’s lands, however, and officially classed as a dependency. Therefore, sending goods to customers on the island is not as straightforward as it might be when shipping consignments between Glasgow and the Outer Hebrides, for example. What do British firms need to know about the latest rules on shipping freight to Guernsey?
VAT Is Applicable on Guernsey Freight
Firstly, British exporters need to know that VAT will be applied on all commercial shipments to Guernsey from the mainland. In other words, you will need to make a VAT declaration to show customs officials how much VAT has been applied. Importantly, these declarations need to be filled out, whether or not you are using a courier service, a freight forwarding firm, or the Royal Mail. Even items that are being sent as gifts must have VAT applied.
That said, this is only the case if they are of a value greater than £39. As such, you should consider most Christmas gifts and samples being sent to clients on Guernsey as items you’ll need to declare VAT for. Technically, VAT doesn’t have to be prepaid for freight heading to Guernsey but not settling it in advance can cause otherwise hold-ups with the shipments concerned.
Customs Declarations Are Mandatory
British firms that export to the European Union may already be used to making customs declarations when they send consignments over the English Channel. What they are often unaware of, however, is that HMRC will expect similar declarations to be made for goods that are being sent to Guernsey. To complicate matters, there are two different paper forms that are in operation, one for goods up to £270 in value and another for consignments above this amount.
According to an Essex-based customs clearance agency, Barrington Freight, having an agent sort out customs declarations before goods are even en route to Guernsey is the best way of avoiding delays at ports like Portsmouth which serve the island. Remember that incorrect or missing declarations will often not just mean delayed goods but result in extra time and money to resolve problems, too.
Today, much of the customs process for exporting goods from the UK is computerized. British exporters have to be registered on the system to make any overseas shipments, including those to Guernsey. Although registration is not, in itself, a complex process, filling out individual declarations of each shipment can be. This is because various commodity codes are in operation for different classes of goods. Some inexperienced exporters will inevitably fall foul of this coding system, especially when certain freight might be covered by more than one code. Any company that HMRC thinks is not making truthful declarations, whether intentionally or otherwise, can face penalties. That’s why it is often better to turn to a customs clearance specialist even when shipping freight to a Channel Island like Guernsey.
Shipping Freight to Guernsey via France
In some cases, it will make logistical sense to send a shipment to St Peter Port in Guernsey via Cherbourg in Normandy or St Malo in Brittany. Perhaps you are planning on sending goods to French clients and will arrange for your customers in Guernsey to receive their orders as your van or lorry makes its way back to the UK via St Peter Port, the island’s commercial hub, for instance. Bear in mind that freight may also arrive at Guernsey from the EU via St Helier on Jersey if multi-drop shipments are being made across the Channel Islands.
Whatever your specific arrangements might be for shipping via the EU, you will need to make a full customs declaration since the goods, even though they might have been manufactured in the UK, will be arriving from an external trading bloc. To do this, you will need an EORI number and to have made an electronic security declaration with the Import Control System. Failure to do so will result in significant disruption to your plans. These trading regulations have only been in operation for a relatively short time but it is worth noting that customs officials seldom offer leeway because exporters claim to have been unaware of any rule changes.