Dual customs-excise warehouses need segregation by default

A single premises can hold both a Customs Warehousing Approval and an Excise Warehousing approvalGOV, under a new HMRC assurance manual section. The two approvals do different jobs: a customs warehouse stores imported chargeable goods with customs duties (including import VAT) and excise duties suspended, while an excise warehouse stores customs-cleared imports plus UK-produced goods with only excise duty and VAT suspended. Holding both requires the customs approval and a separate excise warehousekeeper-and-premises approval.

Segregation is the default.GOV Where a premises holds both approvals, the normal expectation is that customs-warehoused and excise-warehoused goods are physically segregated in clearly defined areasGOV, with warehouse plans identifying each approved area and how the goods under each arrangement are distinguished — physical separation being the clearest compliance demonstration and the smoothest basis for HMRC assurance.

Co-location without segregation is an exception with four cumulative gatesGOV: the customs and excise warehousekeepers must be the same legal person or entityGOV, that person must hold and be responsible for both approvalsGOV, HMRC must be satisfied adequate systems and controls manage the arrangementGOV, and the arrangement must be recorded in the approval documentation with any necessary conditionsGOV. The warehousekeeper must show assurance equivalent to or better than physical segregationGOV, and officers must not approve on electronic record-separation aloneGOV — systems, controls, record-keeping and audit trails must be robust enough for proper supervision of both approvalsGOV.

Co-located controls must clearly identify whether goods sit under customs warehousing, excise warehousing or another duty status, the quantity under each regime, the location within the premises, all receipts, removals, transfers and adjustments, and a complete audit trail linking physical stock to each approval's records — supporting full stock reconciliation, effective HMRC audit, and error prevention, detection and correction. Where officers cannot verify a selected item's status or rely on the records, segregation must be imposed.

Two hard bars apply. Co-location is forbidden where different legal persons separately operate the customs and excise approvalsGOV — those goods must be segregated and identifiable so responsibility, obligations and liabilities stay clearGOV. Goods in temporary storage can never co-locate with excise-warehoused goods, whatever the systemsGOV, because temporary-storage goods sit outside any customs procedure with distinct control requirements. Duty-paid goods under co-storage arrangements add a third status the system must differentiate, raising mis-accounting risk that officers must weigh. The same control, traceability and auditability standards extend to goods under other special procedures — inward processing, temporary admission and free zones — stored alongside excise-warehoused goods.

The rules come from HMRC's published assurance manual section for premises approved as both a customs warehouse and an excise warehouse.