A transit guarantee covers the duty and VAT that would become payable if the goods leak out of the transit system — a missed discharge, a diversion, a theft. Without it, HMRC doesn’t let the goods move under suspension.
Who holds the guarantee
Three options, in descending order of common use:
- Broker’s Customs Comprehensive Guarantee (CCG). The broker holds a pool of guarantee capacity with HMRC and allocates slices per movement. Most shippers use this — no per-shipment bond.
- Shipper’s own CCG. Larger importers / exporters apply for their own CCG, usually when volume justifies the £1,500+/year administration overhead.
- Individual guarantee per shipment. Rare — usually one-off high-value or sanctioned-route movements.
How much is allocated
The guarantee covers the full potential debt if the movement fails — not a percentage. Full debt means: all customs duties, import VAT, excise if applicable, calculated at the destination country’s rates for the goods as declared. For a typical EU-bound shipment, that’s duty + VAT. For UK → Türkiye, it’s Turkish duty + Turkish VAT, usually higher.
Reductions and waivers
- Reduction to 50% — available for certain low-risk traders under AEO-like conditions.
- Reduction to 30% — stricter eligibility, longer track record.
- Full waiver — only for specific categories and AEO-Customs holders.
Eligibility is tested per movement. Just because the last shipment qualified for a waiver doesn’t mean the next one does — commodity changes, route changes, value changes all reset the test.
When the guarantee is called
If the Office of Destination doesn’t confirm discharge within the movement’s time limit (commonly 8 days, sometimes extended), the Central Community Transit Office (CCTO) opens an enquiry. If the enquiry isn’t resolved, HMRC issues a Right to be Heard notice, then invoices the guarantee holder for the full debt.
Who ends up paying
This is the important part: the guarantee holder pays first. If the broker holds the CCG, the broker pays HMRC. Then the broker looks to the shipper under the service agreement. If the shipper has an indemnity, the shipper pays the broker back. If the shipper disputes it — cue legal costs. So the whole architecture matters: make sure your service agreement is explicit about who bears the risk when a movement goes wrong.
What we do
We track every open movement against its time limit, pre-empt enquiries by confirming discharge proactively, and keep the guarantee allocation rolling so no shipment waits for capacity. If HMRC does open an enquiry, we respond within the 28-day window — most enquiries close without the guarantee being called.