Did you know that in a customs audit, the HMRC holds records of actual data entered and assesses duties for imports based on what is actually declared to customs, not what is in the trader’s own records?
When a customs audit takes place, HMRC holds records of actual data entered and raises demand on duties for imports not recorded in the trader’s records but actually declared to customs
– HM Revenue & Customs
Do you trust that your records are up to date and match the HMRC’s data? Are you sure the customs broker or freight agent entered the correct information on your declarations?
“A significant proportion of companies we talk to don’t receive customs declarations from their brokers, and even those who do often don’t conduct self-audits on an adequate sample of declarations to uncover mistakes”, Mark Jamieson, VP of Operations at Emma Systems UK says.
Human errors are likely to occur when making customs declarations. Common errors include using the wrong:
- Currency
- Country of origin
- Customs Procedure Code
- Tariff number /Commodity Code
Do you check and verify that the customs broker or freight agent in fact entered the right information on your declarations? In the end, you are responsible for the declarations, regardless of if you use brokers or agents for making the declarations.
Obtain import and export data from the authorities
MSS – Management Support System Reports
Luckily, traders can access the same data as the HMRC by requesting Management Support System (MSS) reports or Customs Date Service (CDS) data reports from the government.
For MSS there are four different reports available, covering:
- Import item
- Import entry
- Import tax lines
- Export item
The MSS reports include information about:
- Entry date
- Commodity code
- Customs Procedure Code
- Value of goods and tax paid
Which report(s) should you order? According to the HMRC, import and export item reports should meet most customers’ needs.
Read more about Management Support System reports and how to order them
CDS – Customs Declaration Service reports
As for the Customs Declaration Service data sets, the reports are covering:
- Import item
- Import header
- Import tax lines
According to HMRC, the import item report should meet the needs of most importers.
The CDS reports include information about:
- Entry date
- Commodity code
- Customs procedure code
- Value of goods and tax paid
Read more about Customs Declaration Service reports and how to order them
Report frequency
You can subscribe to monthly MSS / CDS reports, one-off reports or even a one-off retrospective report for the last 4 years.
We usually recommend our customers subscribe to the monthly reports so they can verify customs data as part of their regular customs compliance checks and routines.
How to use the customs report data for self-audits and audit-preparations
You subscribe to the reports from HMRC, now what? Having the data means little if you don’t make use of them!
Detect missing declarations
The reports can be used to ensure that the number of declarations you received is consistent with the number registered by the authorities for the same period. This helps you identify missing declarations or potential fraudulent activities involving your VAT ID.
Detect inaccuracy
Moreover, you can check and match that the data from the reports match the data in your records. Unknown Customs Procedure Code showing up? Declarations from vendors you don’t recognize? Does the value and tax information match your records?
How can Emma E-Doc speed up the process?
The MSS data is provided as excel files, and you can of course manually go through the files and match the data against your own records. Using Emma E-Doc, you can easily automate and speed up the process significantly.
Identify missing customs documents using Emma E-Doc
Uploading the CDS/MSS Import & Export item reports from HMRC into the Emma E-Doc application allows our clients to quickly identify missing documentation, not only the declaration but common to any audit proof of export such as waybills and certificates also.
Analysis is further supported in the Emma E-Doc with an intuitive user interface with onscreen reporting, utilising the data from the CDS/MSS Import & Export item reports, removing the requirement for pivot tables and working in spreadsheets.
- Upload the MSS / CDS reports to the Emma E-Doc platform to match declarations in your archive with declarations registered by HMRC
- Request missing declarations from your customs brokers from within Emma E-Doc
Analyse customs data using Emma E-Doc
Analysis is further supported in the Emma E-Doc with an intuitive user interface with onscreen reporting, utilising the data from the CDS/MSS Import & Export item reports, removing the requirement for pivot tables and working in spreadsheets.
Search for incorrect customs data regarding Country of Origin and/or preference codes, with the option of contacting the customs broker and requesting the declaration to be reprocessed.
- The Emma E-Doc platforms intuitive search functionality makes it easy to identify incorrect information
- Report errors to customs broker for reprocessing and potentially reimbursement
- Using historic data to over time improve performance and educate suppliers, ensuring they provide the correct supporting documents such as GSP certificates
Issues, anomalies and requests for missing or reprocessing declarations is controlled within Emma E-Doc, resulting in a true end to end compliance regime.
Customs data from other countries?
Emma E-Doc also supports uploading and matching statistics from Norway, Sweden, Denmark, Finland and France, as well as the MSS / CDS reports.
Getting Started with Customs Compliance: Essential Steps for Global Business
Law-abiding businesses don’t intend to commit fraud, but as your business expands globally, your obligations also significantly change. Without adequate procedures and controls, your company could overpay duties or become entangled in costly investigations, which could drain your finite resources and result in penalties.
The required customs expertise needed depends on the scope and complexity of your company’s declarations. Some steps all companies involved in international trade should take are:
- Getting in place routines for internal controls and self-audits
- Gaining a solid knowledge of your products (this includes knowing what procedure codes applies, as well as the ‘countries of origin’ where your products are manufactured or exported from)
- Establish customs broker instructions (and make sure your brokers and agents follow them!)
- Get the MSS reports from HMRC (or similar reports from your national customs authorities)
- Utilize a software such as Emma E-Doc to simplify the process of detecting and matching declarations against MSS data
Buyer’s Guide: Post-Customs Clearance Software
A detailed guide that introduces digital customs archives and provides guidance on what to keep in mind when assessing them.
Frequently asked questions about MSS & CDS data:
You can subscribe to Management Support System (MSS) reports and Customs Declaration Service (CDS) reports from the HM Revenue & Customs.
Same goes for accessing export data from customs.
There are currently four MSS reports available, covering:
– Import item
– Import entry
– Import tax lines
– Export item
The MSS reports include information about:
– Entry date
– Commodity code
– Customs Procedure Code
– Value of goods and tax paid
According to the HMRC, the import and export item MSS reports should meet most customers’ needs.
There are CDS reports for: import item, import header, import tax lines.
The CDS reports include information about:
– Entry date
– Commodity code
– Customs procedure code
– Value of goods and tax paid
According to HMRC, the import item report should meet the needs of most importers.
Customs and Tax authorities in multiple countries provide data and reports on companies’ import and export activities, although the specifics and level of detail vary across countries. We recommend that you reach out to your local customs authorities to determine what data they can provide.
As for Emma E-Doc, we support uploading and matching statistics from Norway, Sweden, Denmark, Finland and France, as well as the MSS / CDS reports.
Blog post: Who is responsible for the customs declarations?
Who should oversee the submission of customs declaration? Who archives and keeps the documents for the required amount of time? And what about verifying that the information is accurate?
