In today's global trade landscape, businesses that import and re-export goods face significant financial challenges due to import duties. For companies dealing with EU-origin goods that are shipped back to the EU, these costs can add up and negatively impact cash flow and profitability. However, there is a solution—Returned Goods Relief (RGR), a method that allows businesses to reclaim import duties on eligible goods.

Understanding Import Duty and Its Impact

Import duty is a tax imposed on goods entering the UK, contributing to the "landed cost" of products. For businesses, these added expenses affect cash flow and competitiveness in the European market. The issue becomes even more concerning when EU-origin goods are re-exported to the EU, as they often face additional duty charges, increasing costs unnecessarily.

The Financial Strain of Import Duty

Import duties can have a severe impact on business cash flow. When EU-origin goods are imported into the UK and later sent back to the EU, businesses may end up paying duty twice—once upon import and again upon re-export. This repeated cost can:

• Reduce profit margins
• Increase the total cost of goods sold
• Make pricing less competitive in the EU market

The Solution: Returned Goods Relief (RGR)

Returned Goods Relief (RGR) offers a way for businesses to eliminate unnecessary import duties. This relief allows duty-free re-export of EU-origin goods under specific conditions. Here’s how RGR works:

1. Eligibility Check – The goods must be of EU origin and originally imported into the UK before being re-exported.
2. Customs Declaration – Businesses must declare the goods under RGR at the time of export.
3. Proof of Re-Export – Documentation confirming that the goods were previously imported into the UK and are now being returned to the EU is required.
4. Customs Clearance – Once approved, businesses avoid paying import duty on the re-exported goods.

What Goods Qualify for RGR?

Various types of goods are eligible for RGR, including:

• Raw materials, semi-finished goods, and finished products
• Machinery and equipment temporarily in the UK for repairs or inspections
• Goods returned due to quality issues, excess stock, or customer returns

Real-World Benefits: A Case Study

Many businesses have successfully leveraged RGR to cut costs and streamline operations. A notable case involves a UK-based distributor of EU-manufactured machinery. By utilizing RGR, they:

• Eliminated import duty costs on returned equipment
• Improved cash flow by reducing unnecessary expenses
• Maintained competitive pricing in the EU market

How Unsworth Can Help

With 50 years of expertise in freight and supply chain management, Unsworth offers tailored solutions for businesses seeking to minimize import duty costs. Their team provides end-to-end support, including:

• Expert customs brokerage services
• Logistics and consultancy tailored to RGR
• Digital tracking tools for real-time freight management

For businesses dealing with EU-origin goods, understanding and applying for Returned Goods Relief can result in substantial financial savings. By working with customs specialists like Unsworth, companies can optimise their supply chain, improve cash flow, and remain competitive in international markets.

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