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The essential guide to commodity codes and HS categories

Our objective is to examine when and why commodity codes are used, what they look like, and how to find the one that best fits your needs.

Choosing between commodity codes and HS categories is important if you intend to start a business that involves importing or exporting products. They are used for the classification of goods for import and export, so they can move safely and in compliance with customs, tax, and duty regulations.

As we proceed through this guide, we’ll explore when and why commodity codes are used, what they look like, and how to pick the right one for your needs.

The following information will explain what commodity codes are all about.

How do commodity codes work?

The commodity code provides details about the goods you’re importing or exporting, including what they are, what they are made of, how they are used, and even how they are packaged. Besides tracking imports into the country and ensuring that hazardous items are treated properly, this information is also used to calculate import duty and VAT.

You must ensure the right commodity code is included in your customs declaration when importing anything into the UK. In the event that your goods can’t be correctly matched to the right code, you’ll pay the wrong duties – risking serious legal consequences, including top-up taxes and fines, and delaying deliveries to customers.

The online trade tariff lookup tool can be used to find the correct commodity code. Alternatives include contacting HMRC for specific advice or using the Government-issued product classification guides.

What you need to know about commodity codes

In the import and export industry, commodity codes have a number of applications. These documents are used when completing paperwork for customs declarations and can influence how much tax and duty you pay to import or export a product. In addition to using the correct commodity code, it is also important to comply with any relevant safety or legal regulations when importing products that may be dangerous or restricted.

Post-Brexit structure of the code

You will now have to include commodity codes in the customs declaration when clearing goods through customs in the UK or EU. This will let you know what taxes, including VAT and tariffs, you are responsible for paying.

Both the UK and the EU use the standard global 10-digit format, which has the ability to add additional 4-digit codes needed to apply certain measures, such as trade defense or suspensions.

Commodity codes are made up of a range of digits that identify a particular product. These specifications specify the type of product, the materials used, and the production method as follows:

  • Numbers in the HS code: The HS code is the 10-digit global standard called the Harmonised System. This format has been used in the UK since January 2021.
  • A number of EU digits added: There have been four more EU digits added, possibly making it 14 in total. These EU numbers are 2 digits CN heading (Combined Nomenclature); 2 digits TARIC (Integrated Tariff of the European Communities).

You can find the UK HS code for perfume by searching for the commodity code 3303001000 in the UK trade tariff search engine.

The essential guide to commodity codes and HS categories

Access2Markets offers a web-based service that delivers the EU commodity code, which should be accurate in most cases.

The essential guide to commodity codes and HS categories

Pro tip: Access2Markets is geo-blocked from Great Britain if the country entered in the “country from” field is an EU member state; however, the site won’t be blocked if the country entered is the UK.

There is a possibility that the EU and UK classify items differently. Both, however, are members of the World Customs Organisation, which applies the Harmonised System, which is designed to achieve uniform classification across contracting parties.

Pro tip: If you are exporting from the EU, then the EU export declaration will only require the commodity code to be eight digits. However, the longer commodity code would be required on the UK import declaration.

The company can use Access2Markets (with the “country from” being the UK) to obtain a commodity code, truncate it to eight digits, and use it on the EU export declaration.  Alternately, you can use the advanced search function on the EU TARIC website and truncate the results.

With just a few numbers, importers and exporters – and every other authority and organization that handles products along the way – know exactly what they’re dealing with.

Look up your commodity code using the trade tariff lookup.

  • Click here to access the UK government’s trade tariff lookup.
  • Start now!
  • When you enter your search term, a dialogue box will automatically populate with common searches to assist your search
  • To help you narrow it down to the correct product category, suggested commodity codes will appear starting with the HS chapter and headings
  • The suggestions can be further refined by using other information, including the material or packaging of the item
  • Once you find the correct item type, you will be shown the HS code, as well as any important information related to this code – such as whether you need a licence to import or export items.

Can you use an incorrect or a lackluster commodity code?

Using the wrong commodity code may result in your goods being seized or delayed by customs. Taxes and duties may be incorrectly calculated, or you may overpay and be liable for penalties.

A license is required to import or export some items, such as plants, animals, or anything that might be hazardous. In the event that you try to move these products by using an incorrect commodity code, you will be breaking the law and facing serious legal ramifications.

Find out what commodity code to use for your products.

The other option if you can’t find the commodity code you’re looking for is to ask HMRC for advice on the best code to use for your product. Email HMRC using the following address:

classification.enquiries@hmrc.gsi.gov.uk

You will receive a response from HMRC within five working days. Other EU member states have similar solutions.

Ask for advice before taking action.

For advice on the commodity code, you’ll need to include information about the product you intend to import or export. Include the following information:

  • Your company name, if applicable
  • Your contact information
  • (including an email address and a telephone number)
  • Agricultural, chemical, textiles or ceramics – including food, drink, plastics, cosmetics, sports equipment, games, toys, clothing, shoes, electrical, mechanical or miscellaneous – including vehicles, optical and measuring devices, machinery, musical instruments, metal, furniture, lighting, straw, glass, wood, jewelry
  • Provide a breakdown of the materials used in making the goods (if more than one)
  • How the goods are used
  • to perform their functions
  • The way the goods are presented or packaged
  • Use whatever code you think is appropriate for your goods
  • If you have been able to partially categorize the code

separately, you should contact each product separately.

What you need to do to obtain an EU-wide BTI ruling

You might be able to confirm your commodity code by applying for a BTI – a binding tariff information ruling. You don’t have to guess what commodity code is assigned to the product you’re exporting when you have this legal document.

You can benefit from obtaining a BTI since you’ll know what commodity code is needed for your imports and exports. You don’t have to pay for a BTI ruling, but you will have to pay if there are tests required, for example, to identify the materials in your product.

Generally, these rulings last for three years and are binding throughout the EU.

Each BTI ruling application must be processed through the EU’s centralized Customs Trader Portal.

Applying for a BTI ruling

tariff.classification@hmrc.gov.uk

If you are based in Britain, you can apply to access the EU Customs Trader Portal by sending the above email using the subject line “Enrolment EU Central Service”, including your EORI number.

Find out more about the process here.

HMRC will aim to reply to your email within five working days to confirm you’ve been set up to access the EU Central Service and provide you with the link to access it.

Please provide the following information once you’ve received the link:

  • Detailed information about your goods, which may vary depending on your goods
  • brochures, manuals, photographs, and samples, when appropriate. HMRC must be informed if you would like the information to remain confidential.

Also, you can let HMRC know what you think the commodity codes should be.

Steps after submitting your application

We aim to respond to your application within four months. In addition to receiving the correct commodity codes and the starting date for the period of validity of the information, you will receive a legal document informing you of this information. The document also shows that:

  • The designation is unique.
  • Name and address of the holder of the information, legally entitled to use it (decisions are not transferrable)
  • Describe the goods (including any specific marks and numbers to identify them at the border)
  • Explain the legal basis of your decision

Six countries (including Britain) have their own BTI ruling application sites that you can use in addition to the EU central service.

How to apply for a BTI if you’re in Northern Ireland

HMRC can issue binding tariff information decisions to traders or individuals with an EORI number starting with XI for goods you intend to import into or export from:

  • the Republic of Ireland
  • EU member states, if you’re established in Northern Ireland

If you’re based in or exporting to Northern Ireland, you can find more information about applying for a BTI decision here.

Commodity codes: why are they important?

Getting the right commodity codes is one of the first things you’ll need to do before you can import or export goods. Even though it may seem complicated, there is help available for you to ensure you get the right code for your business. All the resources described here should be able to help you get your import/export business off the ground.

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