HMRC: New CDS Data Elements 2/3 4/4 Codes Updated in Appendix 20

• HMRC has updated Appendix 20 of the Customs Declaration Service, introducing several new measurement unit codes for Data Elements 2/3 and 4/4.
• These updates include specific codes (SPR, EAS) to prepare for changes in the alcohol excise regime effective August 1, 2023.
• Measurement unit codes are only required when stipulated by a commodity code, document, or for manual tax calculations.
• The 'GBP' measurement unit code has strict usage limitations, permitted only for manual duty calculations in Data Element 4/4 and never in Data Element 2/3.
• Businesses must consult the UK Integrated Online Tariff and the updated Appendix 20 to ensure correct declaration practices and avoid non-compliance.

Compliance officers and trade lawyers must meticulously review the updated Appendix 20 for the Customs Declaration Service to ensure accurate use of measurement unit codes, particularly for new codes and changes related to the alcohol excise regime, to avoid declaration errors and potential penalties.

His Majesty's Revenue and Customs (HMRC) has issued significant updates to Appendix 20, which details the measurement unit codes essential for completing Data Elements 2/3 and 4/4 within the Customs Declaration Service (CDS). These revisions introduce several new codes, including ENP, KBL, KCW, KSE, MPR, and TNE-O, expanding the range of units available for declarations. Concurrently, an outdated reference to the legacy CHIEF system has been removed, signaling a complete transition to the CDS platform.

Further specific additions to the measurement unit codes include KTC and CTG, which are now designated for use with commodity code and tax type 633. The guidance also reflected an updated end date for the wine easement, which ended on February 1, 2025. In anticipation of the upcoming changes to the alcohol excise regime, effective from August 1, 2023, new codes SPR and EAS have been incorporated into Appendix 20. Additionally, a correction has been made to the definition of the measurement unit code MWH, ensuring accuracy for users.

The application of these measurement unit codes for Data Elements 2/3 and 4/4 is strictly conditional. They are only to be completed when a commodity code, a specific document, or a manual tax calculation explicitly mandates the provision of a measurement unit and its corresponding qualifier. If these requirements are not specified against the document code, procedure code, or commodity code, then this data is not necessary, unless a manual tax calculation is being performed.

Crucially, the measurement unit code 'GBP' carries stringent usage restrictions. It is exclusively permitted when a manual duty calculation is being undertaken. Under no other circumstances should 'GBP' be utilized in Data Element 4/4, and its use is entirely prohibited in Data Element 2/3. For Data Element 4/4, which pertains to the tax base, measurement units and qualifiers are only required to substantiate the calculation of tax amounts, such as when a third quantity like alcoholic strength by volume is needed, or during a manual tax calculation. In the specific instance of a manual tax calculation, 'GBP' is the sole measurement unit code permissible in Data Element 4/4. The UK Integrated Online Tariff provides detailed specifications for commodity codes that necessitate a measurement unit and qualifier, guiding declarants on which appropriate code from the attached list to enter, for example, 'LTR' for litres.

The recent updates to Appendix 20 for the Customs Declaration Service carry significant implications for compliance officers and trade lawyers. It is imperative that these professionals meticulously review the revised guidance to ensure accurate use of the new measurement unit codes, particularly those related to the alcohol excise regime CDS changes. Failure to correctly apply these codes can lead to declaration errors, potentially resulting in delays, queries from HMRC, and the imposition of penalties.

Specific attention must be paid to the restricted use of the 'GBP' code within Data Elements 2/3 and 4/4, as its misuse could lead to immediate non-compliance. Where a specific document, such as a license, requires a quantity and measurement type to be decremented, the appropriate code from the attached list must be entered, with the quantity declared in the eighth component. Conversely, if no quantity, measurement unit, or qualifier is required for a particular data element, it should be entirely omitted. Adherence to these precise guidelines is critical for maintaining compliance with HMRC regulations and facilitating smooth customs operations.

Compliance officers and trade lawyers must review the updated Appendix 20 for the Customs Declaration Service to ensure accurate use of measurement unit codes, particularly for new codes and changes related to the alcohol excise regime, to avoid declaration errors and potential penalties. Specific attention should be paid to the restricted use of code 'GBP' in Data Elements 2/3 and 4/4.

Source: Original reporting via GOV.UK guidance