Authorised Economic Operator ― eligibility criteria

By Tolley
VAT_tax_img8

The following Value Added Tax guidance note by Tolley provides comprehensive and up to date tax information covering:

  • Authorised Economic Operator ― eligibility criteria
  • Compliance
  • Managing commercial and transport records
  • Financial solvency
  • Practical standards or competence of professional qualifications
  • Security and safety
  • Accreditations

This guidance note should be read in conjunction with the Authorised Economic Operator ― overview guidance note. This note provides details of the eligibility criteria that must be satisfied and the test that will be undertaken by HMRC before a business can be granted Authorised Economic Operator (AEO) authorisation.

Compliance

HMRC will examine the business’ compliance record for customs and tax in order to confirm that the business has an appropriate level of compliance. The following taxes will be checked for the last three years before the date of the application as part of the process:

  • corporate tax
  • customs duty
  • excise duty
  • national insurance
  • PAYE
  • VAT

Notice 117: Authorised Economic Operator ; Regulation (EU) No 952/2013 ; Commission Implementing Regulation (EU) 2015/2447 ; Commission Delegated Regulation (EU) 2015/2446 

For businesses that have been established for less than three years, their compliance will be reviewed based on the information / documentation that is available. HMRC will be seeking to ascertain whether a serious infringement or repeated infringements of customs rules have been committed by either the applicant or another person who is responsible for running the business (ie company director, company secretary, solicitors / lawyers acting for the applicant, and those persons directly responsible for imports / exports). HMRC will also take into consideration any customs authorisations that have been revoked or withdrawn and the reasons why this occurred.

HMRC states that it will expect the business to be able to demonstrate that it has:

  • “procedures in place to identify and disclose any irregularities or errors to HMRC or, where appropriate, other regulatory bodies
  • taken the appropriate remedial action

More on Union Customs Code: