UK fulfilment centre VAT fraud update

The UK’s HMRC has updated plans to impose VAT fraud customer due diligence requirements on fulfilment houses.

The Fulfilment House Due Diligence Scheme (FHDDS) regime was to be introduced in primary legislation this summer, but was delayed due to the snap general election.  HMRC has now confirmed that the measures will be included in an early-autumn Finance Bill, along with secondary legislation.

The plan remains to introduce an approved fulfilment house register from April 2018, and make it compulsory from April 2019. All qualifying businesses will have to perform certain checks on their customers in an attempt to detect and report sales without VAT, or under declared customs values on goods.

The measures include the fulfilment housing have to retain:

• The details and address of any non-EU owner of the goods, and that this is satisfactory
• The import entry number
• The valid VAT registration certificate of the owner of the goods
• Onward supply delivery documents
• Clear records of all goods, including descriptions, and their ownership
• Proof of notification to the non-EU seller of their VAT obligations

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