How Professional Advice Affects Customs Liability

Many businesses assume that relying on brokers, consultants, or professional advisers transfers customs risk outward.
In reality, customs authorities and tribunals consistently hold that risk ownership remains with the trader, regardless of who prepared the declaration or gave the advice.

Navigating UK customs regulations can be complex and time-sensitive. To manage these challenges, many businesses rely on external consultants or advisers for support. But when things go wrong, one question becomes critical:

Does professional advice reduce liability or just support a defence?

According to UK tribunal decisions, the answer is both yes and no. While professional advice can support a case for reasonable care, it does not automatically absolve a business of responsibility. This article explores how customs liability and professional advice intersect and what steps businesses must take to ensure they remain compliant.

Can Customs Advice Serves as a Defence?

Tribunal cases in the UK show that relying on professional advice can help demonstrate that a business took reasonable care. However, this defence is only effective when businesses:

• Select a competent adviser
• Provide accurate information
• Understand and evaluate the advice to demonstrate reasonable care
• Properly implement the guidance received. Simply obtaining and filing advice without further action is insufficient.

Critically, none of these steps transfer responsibility to the adviser. They demonstrate that the business exercised judgment not that it outsourced risk.

Case Example: Canadian Solar EMEA GmbH

In a 2023 case involving Canadian Solar EMEA GmbH, the tribunal assessed a dispute over customs classification. The business had sought advice early in the transaction, and although the advice turned out to be incorrect, the tribunal found the company had not acted negligently.

This case illustrates how customs liability and professional advice are evaluated together: early engagement and documentation supported the company’s position.

The tribunal did not assess whether the adviser was competent, it assessed whether the business acted responsibly in commissioning and using the advice.

The Danger of Passive Reliance: Hill and McCracken (TC9293)

In contrast, the tribunal in D Hill and D McCracken (tax matter) found the taxpayers had not taken “objectively appropriate steps” to verify the advice they relied upon. The advice came via vague emails, and the individuals submitted information to HMRC without clarification.

The tribunal criticised their actions as “unchecked assumptions” rather than “objectively reasonable reliance”, emphasising the passive reliance on professional advice does not mitigate liability.

This case highlights a common misconception: delegating a task does not delegate accountability.

Why Customs Agents (Brokers) Are Not a Risk Strategy

Customs Agents (brokers) and advisers are specialists in execution and interpretation. They do not:

• Own your commercial decisions.
• Design your internal controls.
• Monitor consistency across transactions.
• Carry liability for customs debt.

Treating brokers as risk owners creates blind spots especially where advice is applied inconsistently across regions or over time.

How to manage professional advice

Professional advice is most effective when embedded into a governed customs risk framework, not handled ad hoc or transaction by transaction.

• Choose a Competent Adviser: Ensure the adviser is qualified and experienced in customs compliance or the specific area of concern.
• Provide Complete and Accurate Information: Incomplete or inaccurate inputs can lead to flawed advice. Share all relevant facts and documents upfront.
• Review and Evaluate the Advice: Ask: Does this advice make commercial sense? Is it consistent with established practice?
• Document the Process: Keep detailed records, including correspondence, supporting documents, and the rationale behind following the advice.
• Watch for Red Flags: If something seems off, like errors, inconsistencies, or overly simplistic solutions seek clarification or a second opinion. This does not mean businesses must become technical experts themselves, but they should apply common sense when assessing whether reliance on the advice is reasonable and question it if they have doubts.

Tribunal decisions like Cannon (TC6254) affirm this principle. The tribunal stated it is difficult to view a taxpayer as negligent if they identify the need for professional advice, select a competent adviser, provide the necessary information, and rely on well-considered advice.

Key Considerations in Customs Advice

Advice Format: Draft vs Final

Some advice is straightforward and can be issued in final form immediately. However, on some projects, advice may go through a qualifying process and be labeled as “draft.” Draft advice is typically not finalised and may not yet be ready for implementation. At Alegrant, for example, we issue draft opinions pending additional client data or when international coordination is needed so the client has visibility of the progress, however, it is clearly indicated that the advice is not ready for implementation.

Tip: Don’t act on draft advice. Ask why it’s in draft form, resolve open issues, and request the final version.

Advice Substance: Is It Commercially Sound?

Not all advice requires deep legal opinions—but even simple guidance should align with commercial substance. Regardless of complexity, you are expected to ensure the advice aligns with genuine commercial practices. You should question anything that appears incorrect or overly simplistic.

In Bayliss (TC5251), the business questioned the advice and confirmed its legality, demonstrating due care. In contrast, the Boston Consulting Group (TC9049) decision emphasised that no advice can entirely remove the obligation to evaluate whether the proposed transactions hold basic commercial validity. the First-tier Tribunal stated: “We would expect to see an opinion on file from a professional firm assessing the risk of challenge to the structure, or at least an internal paper produced by the tax department assessing the same.”

Tip: Ensure the advice clearly covers the proposed transaction and passes a common-sense check.

Advice Clarification: Do You Understand It?

Understanding the advice is as important as receiving it. If you don’t understand it, seek clarification. Demonstrating that you engaged with the advice, asked questions, and made efforts to understand its implications is critical—especially when the adviser is not independent. At Alegrant, we host final review meetings to help clients fully grasp their obligations.

Tip: Don’t hesitate to ask questions. Clarifying advice helps demonstrate your active engagement.

Advice Implementation: Timing and Accuracy Matter

How you implement advice is as important as obtaining it. Delays or partial implementation can undermine the protection that advice might offer. This is especially true when customs rules change frequently.

If your business lacks a dedicated customs function, consider spreading compliance tasks across departments or seeking help from external consultants to design proper internal processes.

Without central oversight, advice is often implemented differently by region, broker, or business unit creating inconsistency that increases audit exposure.

Advice Documentation: Build an Evidence Trail

Keep written records of all advice, especially where customs liability is a concern. If the advice covers a specific transaction, store related documents (e.g., customs declarations) alongside it.

At Alegrant, our opinions often include annexes containing the documents reviewed ensuring that all references are centralised and traceable.

Tip: If you decide not to follow the advice exactly, document your reasoning and risk mitigation steps.

Professional advice is a input, not a system

Businesses that rely on advisers without central governance often discover that they have multiple interpretations, inconsistent implementation, and no consolidated risk visibility.
Customs authorities do not assess advisers. They assess whether the business had control.

This distinction between execution and control underpins a broader truth: Managing customs risk is a system, not a transaction.

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