Is a bonded warehouse the same as a customs warehouse?

In everyday speech, yes. HMRC uses the term customs warehouse for the UK procedure. The Australian Border Force uses licensed warehouse, under section 79 of the Customs Act 1901. Bonded warehouse is the term most traders use for both.

When do I pay duty and import VAT on goods in a UK customs warehouse?

When the goods are removed from the warehouse and released to free circulation. If the goods are re-exported, or moved to another customs procedure other than authorised use, no duty or import VAT is due on them. HMRC guidance sets out the details.

Can goods be processed in a bonded warehouse?

Only to a limited degree. In the UK, only the usual forms of handling are allowed; other processing needs a separate procedure such as inward processing. In Australia, activities that add value are not permitted in a licensed warehouse.

Does BizBloqs make the customs declarations?

Customs declarations are made by the declarant, which is you or your customs agent, in the customs authority's own systems. BizBloqs holds the stock record that those declarations, and any audit, rely on.

Can I keep bonded and free stock in the same building?

Yes, as long as the authorised area and the stock records keep them apart. In BizBloqs, bonded stock sits in its own zone, so a location never mixes bonded and free goods by mistake.

Bonded warehouse software

In brief

A bonded warehouse holds imported goods before duty and import VAT are paid. In the UK HMRC calls it a customs warehouse; in Australia the ABF calls it a licensed warehouse.
In the UK, duty and import VAT fall due when goods are released to free circulation, not when they arrive. Re-exported goods pay neither.
The warehouse keeper answers for the goods. In Australia the licence holder is liable for unpaid duty on goods it cannot account for.
That makes the stock record the core of the operation: which goods sit where, under which status, and every movement in and out.
The Bonded warehouse module keeps stock under customs supervision apart from free stock. Customs declarations stay with you or your customs agent.

Who it is for

Importers, distributors and logistics providers in the UK and Australia who store imported goods before duty is paid, or who are applying for a customs or licensed warehouse authorisation. Not for you if all your imports are cleared on arrival.

A bonded warehouse lets an importer store goods before paying duty and import VAT on them. The money stays in the business until the goods are sold, and goods that leave the country again may never pay duty at all.

The price of that is supervision. The customs authority lets the duty wait because the warehouse can account for every item, at any moment. The stock record is what makes a bonded warehouse possible.

Same idea, different names

Traders call it a bonded warehouse. The authorities use their own terms.

In the UK, HMRC calls the procedure customs warehousing and the building a customs warehouse. You need HMRC authorisation to run one as a warehousekeeper. A public customs warehouse stores goods for other people, the depositors. A private customs warehouse stores the authorisation holder's own goods.

In Australia, the Australian Border Force licenses warehouses under section 79 of the Customs Act 1901. A licensed warehouse is used for longer-term storage of goods that have not yet been cleared for home consumption, which defers the import duty and taxes.

When the duty falls due

In the UK, duty and import VAT are paid when goods are removed from the customs warehouse and released to free circulation, which means into the UK market. If the goods are re-exported instead, or moved to another customs procedure other than authorised use, no duty or import VAT is due on them.

Two practical rules from HMRC guidance shape the daily work. Goods cleared into the procedure must reach the warehouse named on the declaration within five working days. And only the usual forms of handling are allowed inside; real processing needs a different procedure, such as inward processing.

In Australia, activities that add value are not permitted in a licensed warehouse.

FIGURE 1In and out of a bonded warehouse

Scroll sideways to see the whole figure.

Declarations: made by you or your customs agent.

Why the stock record carries the risk

The duty is suspended, not forgotten. Somebody answers for it.

In Australia, the licence holder is responsible for the safe custody and accounting of the goods, and is liable for any unpaid duty on goods it cannot account for. In the UK, depositors take on the liability for duty and import VAT that becomes due, and HMRC expects records of where the goods are and how they moved, even between sites under the same authorisation.

So a pallet that ends up in the wrong location is not just a picking problem. If it was bonded stock in a free stock location, it may have left the warehouse without the duty being paid.

What BizBloqs does

The Bonded warehouse module keeps stock under customs supervision apart from free stock.

In BizBloqs, a warehouse is built as a tree of zones, aisles and locations, and every zone has a type. Bonded is one of those types. Bonded stock therefore lives in its own zone, with its own locations, and the system knows at every moment which goods are under customs supervision and where they are. Goods move in and out of the bonded zone by scan, so the record follows the goods.

Free stock and bonded stock can share a building without sharing a location. Locations can carry as many properties as you need, so you can also mark goods by depositor if you run a public warehouse for several importers. If you store goods for several clients in general, BizBloqs has a separate 3PL module for logistics service providers, charged on top, also at Enterprise. See 3PL software.

How to lay out zones and locations is explained on the warehouse location system page.

What stays with you and your customs agent

Customs declarations are made by the declarant, which is you or your customs agent, in the customs authority's own systems. That includes declaring goods into the warehouse and removing them from it. BizBloqs holds the stock record that those declarations and any audit rely on.

For the rules themselves, go to the source: HMRC guidance on using a customs warehouse and ABF information on licensed warehouses.

How the module fits

The Bonded warehouse module is not part of the SME solution. From SME+, it is added at a charge, plus its configuration. At Enterprise, all modules are included and you pay for the configuration. It sits on top of the standard warehouse management system and works alongside the ERP systems on the integrations list. For the wider picture of trading across borders, see import and export. How BizBloqs is billed, without prices, is on the WMS cost page.

Applying for an authorisation or licence? Your stock record will be part of it. Book a BizBloqs demo and we will show how a bonded zone looks in the system.

Is a bonded warehouse the same as a customs warehouse?: In everyday speech, yes. HMRC uses the term customs warehouse for the UK procedure. The Australian Border Force uses licensed warehouse, under section 79 of the Customs Act 1901. Bonded warehouse is the term most traders use for both.
When do I pay duty and import VAT on goods in a UK customs warehouse?: When the goods are removed from the warehouse and released to free circulation. If the goods are re-exported, or moved to another customs procedure other than authorised use, no duty or import VAT is due on them. HMRC guidance sets out the details.
Can goods be processed in a bonded warehouse?: Only to a limited degree. In the UK, only the usual forms of handling are allowed; other processing needs a separate procedure such as inward processing. In Australia, activities that add value are not permitted in a licensed warehouse.
Does BizBloqs make the customs declarations?: Customs declarations are made by the declarant, which is you or your customs agent, in the customs authority's own systems. BizBloqs holds the stock record that those declarations, and any audit, rely on.
Can I keep bonded and free stock in the same building?: Yes, as long as the authorised area and the stock records keep them apart. In BizBloqs, bonded stock sits in its own zone, so a location never mixes bonded and free goods by mistake.