How to choose the right customs tariff code – and why it matters

In international trade, one of the key elements that can determine the smooth flow of customs clearance is the correct classification of goods using a tariff code, also known as an HS code. But what exactly is a tariff code, how do you choose the right one, and why is it so important for your business? As a Polish company with extensive experience in customs services across Europe and beyond, we’ll guide you through everything you need to know to avoid costly mistakes.

What are tariff codes and how do they work?

Tariff codes, or HS codes (Harmonized System), are part of an international goods classification system. These codes typically consist of six digits, although in some countries they are extended to eight or ten digits. The first six digits are standardized globally, while additional digits are added at the national level to provide more detailed classification.

These codes identify the nature, composition, and intended use of a product, which is essential for calculating customs duties and meeting legal requirements. Using the correct HS code helps you avoid unexpected costs and ensures compliance with customs regulations.

Why is choosing the right HS code so important?

Getting the HS code right is crucial for your operations. Here’s why:

• Customs duties and taxes: The HS code determines the amount of customs duty, VAT, and excise you’ll pay when importing goods. An incorrect code could lead to higher fees.
  Example: You’re importing construction machinery, correctly classified under code 8430 for earth-moving machines. If you mistakenly use code 8433, which applies to food-processing equipment, you could end up paying more in duties and facing delays.
• Legal compliance: Some goods require additional permits or certificates. The correct HS code ensures your products meet all regulatory requirements and avoids legal issues.
• Faster customs clearance: Using the correct code speeds up customs procedures and reduces the risk of delays. A wrong code can trigger inspections, delays, or even the detention of goods.

How to identify the correct customs tariff code

Choosing the right code starts with understanding your product in detail. Follow these three steps:

1. Understand the material: Is your product made of metal, plastic, or textile? The material helps determine the product category.
2. Define the purpose: What is your product used for? Whether it’s electrical equipment, a building component, or a toy, each has its own classification.
3. Consider technical specifications: Dimensions, weight, and – for chemicals – the composition, all influence the correct HS code.

Practical example of using HS codes

Let’s say your company imports construction machinery. You search the Polish customs tariff database (ISZTAR4) and find that the correct code is 8430. This ensures that duties and documentation match the regulations. If you accidentally classify the goods as food-processing machines (8433), you might face higher duties and more paperwork.

What to do if you make a mistake?

Mistakes can happen. If you realize that you’ve used the wrong HS code, contact your customs agent immediately. You may need to correct the customs documentation, which can take time, but acting quickly can minimize complications. Incorrect codes can lead to delays and extra charges, so it’s best to resolve them as soon as possible.

What tools can help you find the correct HS code?

Here are a few resources to assist you:

• ISZTAR4 – The Integrated Tariff of Poland, available through the PUESC platform, helps you search codes and calculate duties and taxes.
• Customs experts – Partnering with an experienced customs agency like PKS International CARGO S.A. can save you time and protect your business from costly errors.

How long does customs clearance take?

The clearance time depends on many factors, including whether you’ve used the correct HS code. A properly classified product can be cleared within a few hours to a few working days. An incorrect code can cause delays or even halt the process altogether.

Can I get support with customs matters?

Absolutely. Working with professionals can significantly simplify customs procedures. At PKS International CARGO S.A., we offer full support – from choosing the right HS code and filling out documents, to ensuring full compliance with international regulations. As a Polish company operating at key border crossings and customs offices across the EU, we’re here to help your business succeed.

FAQ

Does the HS code affect VAT?
Yes – the HS code directly impacts the VAT calculation on imported goods. The wrong code may result in incorrect tax assessments.

What happens if I use the wrong code?
You may be charged higher duties, and your goods could be held at customs. That’s why it’s crucial to double-check the code before submitting your documents.

Do HS codes change?
Yes – the HS system is updated regularly. Codes can be modified or added, so make sure to check for the latest version.

In summary

Choosing the correct customs tariff code is essential in international trade. It helps you avoid extra costs, delays, and compliance issues. If you’re unsure how to classify your goods, use available tools or contact experts. At PKS International CARGO S.A., we support businesses across Europe and beyond with comprehensive customs services. Whether you import or export, we’re here to help make the process smooth and worry-free.