Q&A: HMRC loses inward processing tribunal case

A recent Upper Tribunal (UT) judgment overturned a First-tier Tribunal (FTT) decision in relation to an £8.9m duty demand issued by HMRC to ThyssenKrupp Materials UK Limited (ThyssenKrupp). The case concerned alleged non-compliance with the business’s authorisation for the inward processing procedure considering what is and isn’t deemed non-compliance and the extent to which errors should give rise to a customs debt.

What were the facts?

The inward processing procedure allows for goods to be imported for processing or repair and subsequently re-exported without incurring customs duty and import VAT. Compliance with the procedure requires a periodic ‘bill of discharge’ return to be submitted to HMRC detailing the usage of the procedure.

In the case in question a typical bill of discharge return included approximately 100 000 to 200 000 data points. The key point of contention related to whether a single error on a...