UK retailers are missing out on export opportunities because of a fear of dealing with returns, according to Europe’s largest customs broker.

Customs Support Group (CSG), which operates in 14 countries across Europe, says that UK-based businesses are ruling out expansion into international markets, including the EU, over concerns about the cost of re-importing goods that are returned or unsold.

Data from Retail Economics and Tradebyte reveals a significant drop in footwear and clothing exports to the EU following Brexit, from £7.4 billion in 2019 to £2.7 billion in 2023 – a decline of more than 60 per cent.

To overcome the fear of international returns and the risk of paying additional duty, specialists from CSG have revealed the three processes retailers should follow to confidently trade in the EU without fear of paying additional tax if goods are returned.  

Utilising individual product tracking, automating returns through customs software and using a Returned Goods Relief (RGR) procedure will enable businesses to efficiently manage returns from the EU without risking an additional tax bill.

Nicola Haynes, senior customs consultant at CSG with more than 40 years’ experience in the industry, said: “Every time goods cross a border, the authority will ask for tax to be paid on those goods, even if they are being returned.

“When goods are returned to the UK, for example, they are treated as a new import unless you can prove they are previously exported UK goods.

“Data shows that many retailers are avoiding international trade with the EU and we know from experience that a lack of in-house resource and knowledge on the customs returns process is influencing this decision – they view it as a big financial risk.

“However, having the right process and knowledge in place can easily bridge this gap, particularly for footwear and clothing retailers who experience a high level of returns.

“Retailers need to have a way to identify the original export to demonstrate that the same goods have been returned and therefore should not be taxed.

“RGR enables good to be re-imported into the UK without incurring additional customs duties or taxes, providing the goods meet the required conditions and have the required documentation.”

This scenario is where businesses benefit from having full tracking and visibility on all products sold, shipped and returned.

Nicola added: “Most retailers will have some sort of tracking system in place to manage the financial side of a customer refund, but that tracking can be extended to align with commercial records and customs records.

“When goods are shipped, their data is captured and can then be matched up if the goods are returned, making it much easier to apply RGR and removing the risk of additional tax.

“This process creates a smoother and more manageable process for retailers, while ensuring a robust trail for HMRC.”

Learn more about international returns and customs clearance with Customs Support Group.

 

NOTES TO EDITORS:  

Customs Support Group (CSG) is the leading European customs and trade solutions provider, facilitating seamless cross-border operations through cutting-edge digital innovations and unmatched industry expertise. 

It has a presence in all major European strategic locations and the most comprehensive service offering in the market. Backed by more than 1,700 dedicated customs professionals, CSG ensures its clients’ goods cross borders with minimal risk and maximum efficiency without hassle or delay. 

 

For more information, please contact Sarah Ross at R&Co Communications on 01926 888308 or email sarah@rcomms.co.uk. 

Issued April 2025