Every imported input has to be traced to a finished product, and the bill of discharge is where you prove it.
Key takeaway
If your business holds a full Inward Processing authorisation, a bill of discharge has to reach HMRC within 30 days of the end of each period for discharge. If it's late or doesn't add up, HMRC can ask for the duty and import VAT you saved, add a penalty, and suspend or withdraw the authorisation. Getting it right and on time is how you keep the saving.
When HMRC approves an Inward Processing application, it can feel like the hard part is over. In practice, that's when the routine starts. Every month or quarter, HMRC expects an account of what happened to the goods you imported without paying duty, and that account is the bill of discharge.
For most of the businesses we work with, customs isn't anyone's full time job. The IPR file sits with someone in finance or operations, alongside payroll, suppliers and month end. That's usually how a deadline slips, and it's an expensive one to miss.
Below, our team explains when the bill of discharge is due, what goes in it, and the mistakes we see most often. If you're still at the application stage, start with our guide on how to apply for Inward Processing Relief.
What is an IPR bill of discharge?
Think of it as a stock reconciliation with HMRC as the reader. On one side, everything you imported under IPR. On the other, where it all ended up: exported in your finished products, sold in the UK, scrapped, or still on the shelves waiting for the next period.
If the two sides match, the relief stands. If part of an import can't be traced, HMRC can ask for the duty on that part. We see this across every kind of IPR business, from pharmaceutical and chemical manufacturers to food processors, engineering firms, textile producers and companies repairing aircraft parts and machinery.
When is the bill of discharge due?
There's no single date in the calendar. It depends on the period for discharge in your authorisation letter, which is based on the estimate you gave when you applied. Your bill of discharge has to reach your supervising office no later than 30 days after that period ends.
By default, imports are grouped by month. HMRC only agrees to quarterly grouping if it's confident you can keep track that way. With a six month period, it looks like this:
| Six month period for discharge | Period ends | Bill of discharge due by |
|---|---|---|
| Monthly (the default): goods imported in January | 31 July | 30 August |
| Quarterly (if HMRC agrees): goods imported January to March | 30 September | 30 October |
If you can see you'll need more time, speak to your supervising office before the period ends. Once it has passed, the debt is already there.
What happens if your bill of discharge is late, missing or wrong?
HMRC sees a missing bill of discharge as a breach of your authorisation, and this is where it gets expensive.
A demand for the duty and VAT you saved
HMRC can issue a C18 demand on any import the bill doesn't account for, even goods you exported months ago.
A debt from the day after the deadline
It belongs to the business holding the authorisation, so it can rarely be passed on to your customer.
A penalty on top
Our guide to customs declaration error consequences explains how HMRC decides on penalties.
Losing the authorisation
If it's suspended or withdrawn, you're back to paying duty at the border on every import, including the goods you export.
Before HMRC withdraws an authorisation or confirms a large demand, you'll usually receive a Right to be Heard letter giving you a short window to respond. By then, most of the work is proving what the bill of discharge should have shown in the first place.
Why this matters right now
HMRC is paying closer attention to IPR holders this year. Customs advisers have reported a rise in duty demands where imports went in under commodity codes the authorisation didn't cover, and more businesses being warned their authorisation could be withdrawn. In the 28 October Budget, HMRC was also given an extra £70m to tackle tax evasion. When HMRC opens a review, the bill of discharge is one of the first documents it asks for, and it comes up in almost every customs audit.
What goes into a bill of discharge?
HMRC's form asks for four groups of information. Most of it comes straight from your import declarations and stock records.
| Section | What HMRC asks for |
|---|---|
| Your details | IPR authorisation number, EORI number, authorisation holder details, the date the bill is due, and bank details |
| Goods you imported under IPR | Import declaration references, commodity codes, descriptions, customs values and the duty and VAT suspended |
| Where the goods went | Exported, sold in the UK or destroyed, with references, dates, quantities and the rate of yield |
| Goods still in stock | Anything still held or in production, carried into the next period |
The part that takes real work is the rate of yield: how much finished product each imported material produced, after waste, scrap and rejected batches. It has to agree with your production records, and that's where HMRC looks most closely.
How to send your bill of discharge
Full authorisation, imports declared on CDS: fill in HMRC's postal form BOD1CDSA and post it to the address on the form.
Authorisation by declaration: use form BOD3CDS, which you can send online, by email or by post. The period for discharge here is six months.
Older goods declared on CHIEF: anything still outstanding can be discharged with the CHIEF form.
Keep a record of when and how you sent it. If HMRC says it never arrived, that record is what protects you.
The six mistakes we see most often
Nobody owns the date. The period for discharge is in the authorisation letter, and that letter often gets filed away by whoever applied, sometimes someone who has since left.
Yields that don't match the factory floor. Rates of yield agreed at the start drift as processes change, and HMRC compares them with your batch records.
Waste and scrap left out. Duty can be due on waste, and leaving it out means the numbers never balance.
Imports under codes the authorisation doesn't cover. Goods declared under a commodity code that isn't listed may not qualify for IPR at all.
UK sales missed. Anything sold in the UK needs its duty paid when it's released, or the bill won't add up.
Leaving the first bill to the last week. The first reconciliation shows every gap in your records. Far better that you find them than HMRC.
Our customs audit readiness guide goes through the records HMRC asks to see when it checks.
What HMRC asked a pharmaceutical manufacturer about its bill of discharge
Our team built the reconciliation into the batch records the business already kept for its regulators, so waste, scrap and rejected batches were covered from day one. We trained the finance, warehouse and quality teams on their part, and ran a full dry run before the first real bill was due.
Our recommendation
Take five minutes today to find your authorisation letter, check your period for discharge, and put the next due date in the diary of whoever prepares the bill. Then ask them one question: could they trace last month's imports to exports, UK sales and waste in under a day? If the answer is no, it's worth fixing before HMRC asks.
Rather not carry this every month? Our team can prepare and submit every bill of discharge for you under Monthly Customs Management, reconciled and on time. We'll start with a free look at your current IPR records, so you know exactly where you stand.
Book a free consultationFrequently asked questions
When is an IPR bill of discharge due?
Within 30 days of the end of the period for discharge shown in your authorisation letter. Imports are grouped by month unless your supervising office agrees to quarterly.
What happens if I don't submit a bill of discharge?
A customs debt starts the day after the deadline. HMRC can then ask for the duty and import VAT you suspended, add a penalty, and suspend or withdraw your Inward Processing authorisation.
Where do I find my IPR authorisation number?
It's on the letter HMRC sent when your Inward Processing application was approved. You'll need it, along with your EORI number, to fill in the bill of discharge.
How do I send a bill of discharge for a full authorisation?
For imports declared on the Customs Declaration Service, fill in HMRC's postal form BOD1CDSA and post it to the address on the form. Older goods declared on CHIEF can still be discharged with the CHIEF form.
Can I get more time to discharge my goods?
Possibly. Speak to your supervising office, named in your authorisation letter, before the period for discharge ends. After that date, the debt has already started.
Do I need a bill of discharge for a customs warehouse?
No. The bill of discharge belongs to Inward Processing. A customs warehouse is controlled through its stock records instead. Our guide to customs warehousing and Inward Processing explains how the two compare.
Sources (checked November 2026): GOV.UK, Moving processed or repaired goods into free circulation or re-exporting them · HMRC, What happens if an importer fails to submit Bill of Discharge · HMRC, Aggregation of declarations and the due date of the Bill of Discharge · HMRC, What happens if an IP authorisation holder does not comply · MHA, Inward Processing authorisation holders face growing HMRC risk
