Preparing for a customs audit: what customs checks

A customs audit is a check after the goods were released: customs may verify the declarations, the supporting documents and the accounts behind them, at the importer's premises or at anyone else involved in the trade [1]. To prepare, keep every document for at least three years, reconcile what was declared with your own records, and correct errors before the auditor finds them [1].

What customs may check after release

The Customs Code lets customs verify, after release, the accuracy and completeness of a declaration and the existence, authenticity, accuracy and validity of every supporting document. They may examine the accounts of the declarant and other records on the operations, and on earlier or later commercial operations involving the same goods [1]. Anyone directly or indirectly involved must provide the documents and information customs ask for, within the time limit they set [1].

German customs base the Zollprüfung on that article. It needs no specific reason, a period already audited can be audited again, and it can take place at anyone directly or indirectly involved in the import, including shareholders, customers or forwarders [2]. Dutch customs carry out the same control as the control after import (CNI) or as an administrative control. It can take place at the declarant, at anyone professionally involved such as the importer, stevedore or carrier, and at anyone who holds the commercial documents, such as a bank [3]. When it shows that too little duty was charged, the duty is recovered afterwards, declaration by declaration [3].

How far back customs can go

A customs debt cannot be notified more than three years after it was incurred. Where it came from an act that could lead to criminal proceedings, national law extends that to between five and ten years [1]. The documents behind a declaration must be kept for at least three years, from the end of the year in which the declaration for release for free circulation was accepted [1].

German tax law asks more. Documents under Articles 15(1) and 163 of the Customs Code must be kept for ten years [4]. Official documents and informal preference proofs that must be signed by hand cannot be kept only as an image or on a data carrier [4].

How a German Zollprüfung runs

The Hauptzollamt issues a formal audit order first, in good time before the audit starts, with form 0683 on your rights and duties [5]. The order names the period and the scope: which duties and which matters, for example the customs value or the preferential origin, or only imports from a certain supplier [5]. During the audit the auditors may enter the business premises in working hours, ask for a suitable workspace, information and the relevant business documents, and look at stored data or ask for it on a data carrier [6].

Where the audit leads to changes, a final meeting discusses the findings before the report, unless you waive it [6] [7]. The report is not itself an appealable decision, but you can ask to receive it before the Hauptzollamt evaluates it and comment on it; the assessment that follows can be appealed [8].

The Dutch audit file

Dutch customs has defined the AuditFile Voorraad, a standard file with data from the company's stock records that is produced at customs' request in a customs audit and analysed with standard checks [9]. It is mandatory for companies that use the ketenregeling and voluntary for others, and it builds on the international standard ISO 21378:2019 [9]. The current documentation set is version 1.12 [10].

A checklist before the auditor arrives

1. List the declarations in the audit period. Ask your broker for the export of every declaration filed in your name.
2. Match each declaration to its file. Invoice, packing list, transport document, freight and insurance invoices, proof of origin, and correspondence with the supplier.
3. Compare code, origin and value with your own records. Look for the same article under two codes, a preference claimed without a proof on file, and freight left out of the customs value; see customs value with CIF and FOB.
4. Check codes that carry measures. A missed anti-dumping duty is part of the customs debt like any other duty.
5. Correct what you find. Within three years of acceptance the declarant can apply to amend a declaration after release [1].

Athren works next to the broker or customs team you already have, and holds what it prepares next to the declaration that was filed, so you see where the code, the origin proof or the value differs.