Can a subcontractor use our inward processing approval?
Yes. A UK subcontractor can process Chinese components on your behalf if named on your inward processing authorisation. You remain responsible for duty and other charges unless a transfer of rights and obligations specifies otherwise. Prepare the factory documents and UK processing brief with Cambridge China Bridge.
Name the processor under the right arrangement
HMRC says a subcontractor must either hold its own inward processing authorisation or be named on yours. Its guidance expressly allows importers to name UK processors on their application to carry out work on their behalf. For work under your authorisation, check the subcontractor against your authorisation documents before sending components.
Ask for the processor’s business name, workshop address, proposed operations and any further subcontracting. Compare these with the arrangement you have put to HMRC. For the wider import decision, use our guide to inward processing before importing components.
Check approval before changing the workshop
Your HMRC authorisation letter sets out its conditions. If the proposed subcontractor or processing arrangement differs from your documents, ask HMRC to confirm what amendment is needed before dispatch. HMRC says you can amend an authorisation by email or by writing to the address on its acknowledgement letter.
Send a processing brief showing the incoming components, the work at each location, the expected finished product and the intended onward destination. Ask for written confirmation that the proposed arrangement is covered. Keep that confirmation with the version of the brief supplied to the processor.
Keep customs responsibility clear
Naming a processor does not itself shift responsibility for charges. HMRC says the authorisation holder remains responsible for duty and other charges that become due on imported or processed goods unless a transfer of rights and obligations agreement specifies otherwise. Treat the subcontractor’s promise to handle customs as something to check against the approved arrangement.
If you intend to transfer rights and obligations, HMRC requires agreement about what is transferred and who is responsible for debt, an application and its approval before transfer. Ask HMRC which responsibilities remain with you. Appointing a declaration agent is a separate decision; see direct and indirect customs representation.
Agree the evidence before components move
Give the processor a written reporting brief. Ask for receipt confirmation, batch identifiers, quantities received and processed, finished output, scrap, unused components and dispatch documents. Agree who reports discrepancies and how you will reconcile the processor’s reports with your own stock records. Our guide to inward processing records and discharge covers the wider record trail.
Use matching part descriptions and batch references on the Chinese factory’s packing list and the UK processor’s receipt. Cambridge China Bridge’s staff in China can help coordinate factory documents with your processing brief. If a processor proposes a different workshop, operation or onward subcontractor, pause dispatch and check the arrangement with HMRC.
Frequently asked questions
Does our UK subcontractor need its own inward processing authorisation?
Not if it is named on yours for the work carried out on your behalf. HMRC says a subcontractor must either hold its own authorisation or be named on the importer’s authorisation.
Can we add a subcontractor to an existing authorisation?
Ask HMRC to amend it and confirm the proposed arrangement before sending goods. HMRC says amendments can be requested by email or by writing to the address on its acknowledgement letter.
Who pays customs charges if the subcontractor makes a mistake?
As authorisation holder, you remain responsible for duty and other charges that become due unless a transfer of rights and obligations agreement specifies otherwise. Check the approved allocation of responsibility.
What should we ask the subcontractor to report?
Agree receipt and dispatch records, batch identifiers, quantities processed, finished output, scrap and unused components. Ask for prompt discrepancy reports so you can reconcile the stock trail.