Customs Glossary: Key Terms Every Importer & Exporter Should Know

Why a Customs Glossary Matters

Customs terminology can feel overwhelming — especially when you’re dealing with declarations, duty calculations, port procedures, and international regulations. Our Customs Glossary is designed to give you clear, simple explanations of the most important terms you’ll encounter in global trade.

Whether you’re new to importing or exporting, or you simply want a reliable reference point, this glossary helps you understand the language of customs so you can trade with confidence.

Essential Customs Terms Explained

Bill of Lading (B/L)

A transport document issued by a carrier. It acts as:

• A receipt for goods
• A contract of carriage
• A document of title (depending on type)

Used mainly for sea freight.

C88 / SAD (Single Administrative Document)

The main customs declaration form used for imports and exports in the UK. Now submitted electronically via CDS.

CDS (Customs Declaration Service)

The UK’s digital platform for submitting import and export declarations, replacing CHIEF.

Commodity Code / HS Code

A numerical code used to classify goods for customs purposes. Determines:

• Duty rates
• VAT
• Restrictions
• Licensing requirements
• Origin rules

Customs Duty

A tax charged on imported goods based on their commodity code, value, and origin.

Customs Warehouse

A bonded facility where goods can be stored without paying duty or VAT until released into free circulation.

Deferment Account

An account that allows importers to defer payment of duty and VAT, usually settling monthly instead of per shipment.

Duty Relief

Schemes that reduce or eliminate import duties under specific conditions (e.g., IP, OP, RGR, TA).

EORI Number

A unique identification number required for businesses trading with the UK or EU. Needed for customs declarations.

EX‑A

An export declaration used for goods leaving the UK. Required for most commercial exports.

Free Circulation

Goods that have cleared customs and had all duties and taxes paid. They can move freely within the UK.

Incoterms

International commercial terms that define responsibilities between buyers and sellers, including:

• Who pays for transport
• Who handles customs
• Who carries risk

Examples: EXW, FOB, CIF, DDP.

Inward Processing (IP)

A duty relief scheme allowing goods to be imported for processing or repair without paying duty or VAT.

LRN (Local Reference Number)

A unique reference used when creating a T1 transit document. Identifies the transit movement before release.

MRN (Movement Reference Number)

A unique number assigned to customs declarations, transit documents, and export entries. Used to track shipments.

Outward Processing (OP)

Allows goods to be exported for repair or processing and then re‑imported with reduced or zero duty.

Preferential Origin

A status that allows goods to qualify for reduced or zero duty under Free Trade Agreements.

Quay Rent / Demurrage

Charges applied when containers remain at the port or terminal beyond the free period.

Returned Goods Relief (RGR)

Allows goods previously exported from the UK to be re‑imported without paying duty or VAT.

T1 Transit Document

A customs document that allows goods to move through the UK or EU under customs control without paying duty until they reach their final destination.

Temporary Admission (TA)

Allows goods to enter the UK temporarily without paying duty or VAT, provided they are re‑exported.

VAT Postponed Accounting

Allows import VAT to be accounted for on a VAT return instead of paying it at the border.

How This Glossary Helps Your Business

Understanding customs terminology helps you:

• Communicate clearly with carriers, agents, and suppliers
• Avoid misunderstandings and delays
• Stay compliant with customs regulations
• Make informed decisions about duty relief and procedures
• Improve your overall supply chain efficiency

This glossary is designed to be a practical, everyday reference for anyone involved in international trade.

Explore More in Our Knowledge Hub

Our knowledge Hub also includes:

• HS Code Guides
• Duty Relief Guides
• Port Guides
• Step‑by‑step customs tutorials
• Practical compliance checklists

If you need help with any customs term or process, our specialists are here to support you.

Get in touch for expert customs advice and guidance.