HMRC goes live with first phase of customs IT system

HM Revenue and Customs (HMRC) has begun the first phase of its staged roll-out of its replacement customs IT system.  

The department went live with the first part of its Customs Declaration Service (CDS) on 14 August, meaning a small group of importers will be able to use the system to make “certain types of supplementary declarations”.

The second phase of the deployment will come in November, when the majority of importers will be able to use the system. However, importers will have to either develop their own, or buy software that is CDS compatible to use the system.

HMRC’s customs transformation programme director, Kevin Franklin, said the first release of CDS “is a major milestone”.

“Going live on time is a great step to fully introducing the new system and is testament to the hard work of HMRC staff and our partners,” he said.

“We have been engaging closely with trade representatives, including software developers, community system providers, freight forwarders and traders about CDS, and we value the support from these organisations in preparing importers and exporters for the upcoming changes

“Our priority now is to make sure software developers, agents and their clients are ready, and we will continue to work closely with them throughout the transition.”

The CDS is intended to replace the current Customs Handling of Import and Export Freight (Chief) system for handling import and export freight from outside the European Union (EU).

Chief, which has been in place for 25 years, can only handle around 60 million customs declarations per year, but with Brexit looming, CDS could be required to handle volumes of up to 255 million declarations annually.

The final and third phase of the roll out, covering the export functionality of the system, will not be released until December 2018, meaning traders who export goods will have only one month to complete the migration, as the entire process of migrating users from the old system to CDS by the end of January 2019. 

There have been concerns that CDS would not be ready on time for the UK leaving the EU, but HMRC remains confident it will meet the deadline. A National Audit Office report published in June 2018 said the tight timetable remained a huge challenge for the department. 

Franklin added that software providers should look at what changes they need to make to their systems “and make decisions about their approach to the roll-out of IT and customer migration in-house”.

HMRC is offering a software developer test service where customs software developers can test their systems against CDS functionality, as well as access to HMRC’s developer hub where they can get information on how to build a CDS software system.

HMRC will continue to run the old Chief system in parallel with CDS during the roll-out while it migrates traders over to the new system.

The department has also had to put a large number of other technology projects on hold due to its work on CDS and Brexit.