What is OPR?
Outward Processing Relief (OPR) is a UK customs procedure that lets businesses temporarily export goods to another country for processing, repair, or manufacturing, and then re-import the finished goods at a reduced rate of import duty. Instead of paying duty on the full value of the re-imported goods, you only pay duty on the value that was added abroad. The original UK goods are duty-free on their return.
If you have just started in shipping and you keep hearing IPR and OPR mentioned in the same breath, this article is for you. OPR is less common than Inward Processing Relief, but in the right circumstances it can save a UK business a meaningful amount of money. Understanding when it applies, and when it does not, is a useful part of your customs knowledge.
This article explains what OPR is, how the duty calculation works, who qualifies, how to apply, and what happens after Brexit. It includes a real-world example, a comparison table with IPR, and answers to the most common questions.
Outward Processing Relief is a customs duty relief procedure. It allows UK-origin goods to leave the UK temporarily, undergo some form of processing or repair abroad, and return to the UK with a reduced import duty bill.
The relief works because customs duty is normally charged on the full customs value of imported goods. OPR removes that charge on the portion of value that was originally UK goods. You only pay duty on the value added in the other country: the processing cost, the labour, the foreign materials incorporated during the process.
Think of it this way. A UK business sends fabric worth £10,000 to a factory in Portugal for cutting, sewing, and finishing. The finished garments might be worth £16,000 when they come back. Without OPR, duty would be charged on £16,000. With OPR, duty is only charged on the £6,000 added abroad, or an equivalent portion of the final value, depending on which calculation method you use.
OPR is the mirror image of Inward Processing Relief (IPR). IPR allows foreign goods to be imported into the UK for processing and re-exported without paying UK import duty. OPR works in the opposite direction: UK goods go out, get processed, and come back with relief on the foreign value added.
The basic flow looks like this:
The goods that come back do not have to be identical to what was sent out. They may be substantially transformed, fabric sent out, finished garments returned. What matters is that HMRC is satisfied the returned goods are the compensating products derived from the UK goods that were exported.
One important requirement: you must have OPR approval before the goods leave the UK. You cannot claim the relief retrospectively after the export has already happened. This is one of the most common mistakes businesses make, and it is covered in more detail below.
OPR and IPR are often confused because they both involve temporary movement of goods for processing. The table below sets out the key differences.
| OPR (Outward Processing Relief) | IPR (Inward Processing Relief) | |
|---|---|---|
| Direction of goods | UK goods sent abroad for processing | Foreign goods imported into the UK for processing |
| Where processing happens | Outside the UK (e.g. EU, third country) | Inside the UK |
| What comes back / goes out | Processed goods re-imported to UK | Processed goods exported from UK |
| Duty relief applies to | Value added abroad (not the UK portion) | Full suspension of import duty while goods are in UK for processing |
| Who uses it | UK manufacturers sending goods out for repair or offshore processing | UK manufacturers processing imported materials for re-export |
| HMRC approval required? | Yes — before export | Yes — before import |
| More or less common? | Less common | More common |
| Typical use case | Warranty repairs abroad, offshore garment finishing, component refinishing | Imported fabric cut and sewn in UK, then exported as finished goods |
In plain terms: IPR is about importing materials duty-free to process them and send them back out. OPR is about sending your own UK goods abroad for work and bringing them back with a lower duty bill.
HMRC accepts a broad range of processes under OPR. The key requirement is that the goods exported from the UK must be identifiable in the goods that come back, either directly or as part of the compensating product.
Qualifying processes include:
The process does not need to be simple. Complex multi-stage manufacturing operations can qualify, provided the approval covers the full scope of the activity and the link between the exported goods and the re-imported products can be demonstrated.
Some things do not qualify. Goods that are consumed in the process, rather than incorporated or transformed, will not produce compensating products that can be re-imported. And goods that are sold abroad rather than returned cannot be re-imported under OPR.
Any UK-established business can apply for OPR approval, provided:
HMRC will also consider whether the UK goods industry would be harmed by granting the relief. This is called an economic conditions test. In most cases it is a formality, but HMRC can refuse OPR approval if they conclude that granting it would harm comparable UK producers.
For repair and maintenance operations, the economic conditions test is usually waived. For processing or manufacturing operations where UK businesses could carry out the same work, HMRC may take a closer look.
You do not need to be a large company. Small and medium-sized manufacturers, clothing brands, aerospace firms, and repair businesses all use OPR. The procedure is open to any EORI-registered UK business with a legitimate processing operation abroad.
OPR approval must be obtained before the goods leave the UK. There are two ways to apply.
Standard approval
This is the most common route for businesses that export regularly for processing. You apply to HMRC’s National Duty Repayment Centre using the Customs Declaration Service (CDS). Your application should include:
HMRC will issue an approval number that must be quoted on all related export and import declarations. The approval will specify the approved goods, the permitted process, and the maximum time allowed for re-import.
Full guidance is available on GOV.UK: Outward processing. HMRC guidance.
Approval by customs declaration (simplified)
For one-off or low-volume OPR operations, HMRC allows a simplified route where the OPR approval is embedded in the export declaration itself. This is known as approval by customs declaration. It is quicker, but it only works in limited circumstances and does not suit regular operations. Check with your customs agent whether this route is appropriate for your situation.
In both cases: do not export the goods before the approval is in place. The relief cannot be claimed retrospectively.
This is the part that confuses most people new to OPR. There are two methods HMRC accepts for calculating the duty relief, and the one you use depends on your approval and the nature of the process.
Also called the standard exchange rate method, this is the approach HMRC defaults to in most cases.
Under this method, duty is charged on the proportion of the final re-imported value that represents the value added abroad.
Formula:
Duty payable = Full duty on compensating product × (Value added abroad ÷ Customs value of compensating product)
Example:
Without OPR, the business would pay £1,920 in import duty. With OPR, they pay £720. That is a saving of £1,200 on a single shipment.
Under this method, duty is charged only on the processing costs: the value actually added abroad, rather than a proportional share of the final value.
Formula:
Duty payable = Processing costs × Duty rate of compensating product
Example (same scenario):
In this example the two methods produce the same result. In practice, the results can differ depending on the composition of costs. The value-added method tends to be more straightforward where processing costs are clearly documented and separated from materials costs. Your customs agent or freight forwarder can advise on which method applies to your approval.
HMRC sets a time limit on how long the goods can remain abroad before they must be re-imported under OPR. If the goods are not returned within the allowed period, the OPR relief is lost and full duty becomes payable.
The time limit depends on the nature of the process:
The clock starts from the date of export, not the date the goods arrive at the processing facility. Build in enough buffer to account for transport time at both ends.
If you need more time, you can apply to HMRC for an extension before the limit expires. Extensions are not guaranteed but are granted where there is a genuine working reason. Do not wait until the deadline is imminent; apply early.
If goods cannot be re-imported in time, for example because the processor has run into delays or the finished goods have been damaged, contact HMRC immediately. Trying to re-import goods after an expired OPR period without notifying HMRC will cause problems on the import declaration.
Good records are the backbone of OPR. HMRC needs to be satisfied that the goods being re-imported are the same goods, or compensating products derived from the same goods, that were originally exported under the approval.
The key documents involved in an OPR operation are:
Export declaration
The export declaration must quote the correct OPR procedure code and the approval number. This creates the record that these goods left the UK temporarily under OPR. Your customs agent will handle this, but they need the approval number and a clear description of the goods.
INF document (Information Sheet)
The INF document, formally the Information Sheet for Special Procedures, is used to connect the exported goods to the re-imported compensating products. It is particularly important when the export and import happen at different customs offices or through different agents. The INF confirms that the goods were exported under OPR and that the goods being re-imported are the legitimate compensating products.
Import declaration
The import declaration for the re-imported goods must also quote the OPR procedure code and the original approval number. It must reference the INF document where applicable. The duty calculation, using either the proportional or value-added method, is carried out at this stage.
Commercial records
HMRC may request supporting documents to verify the value of the processing and the identity of the goods. Keep the following:
HMRC can audit OPR claims. Businesses that cannot produce clear records linking their exports to their re-imports are in a weak position if a claim is challenged.
These are the errors that come up most often, and most of them are preventable.
Exporting before getting approval
This is the most costly mistake. If goods leave the UK before OPR approval is in place, the relief cannot be applied to the re-import. You will pay full duty on the returning goods. Always confirm approval before the export is booked.
Using the wrong procedure code on the export declaration
OPR requires a specific procedure code on both the export and import declarations. If your customs agent uses the wrong code, the OPR link is not established and the relief cannot be claimed on re-import. Brief your agent clearly and double-check the procedure codes.
Letting the time limit expire
If the goods are not re-imported within the approved period, the relief lapses. Keep a record of each export’s date and the corresponding deadline. Flag it in your internal systems as a compliance checkpoint.
Not keeping records of the overseas processing
If you cannot show what was done to the goods and how much it cost, HMRC has no basis for the duty calculation. Keep all invoices, contracts, and correspondence with the overseas processor.
Confusing OPR with IPR
They look similar but work in opposite directions. If you are importing goods into the UK for processing and sending them back out, that is IPR, not OPR. Applying for the wrong approval will cause declarations to fail.
Assuming OPR applies automatically
OPR is not a default. It requires a formal application, an approval number, and correct procedure codes on every declaration. It does not apply simply because the goods are UK-origin or because the processing happens abroad.
OPR still exists for UK businesses after Brexit, but the practical environment has changed.
Before 1 January 2021, UK goods moving to EU member states for processing were treated as intra-EU movements. There were no export declarations, no INF documents, and no customs procedures to manage. The EU single market made OPR largely unnecessary for UK-EU flows.
Since Brexit, the UK is outside the EU customs union. UK goods sent to an EU country for processing are now treated as exports to a third country. EU customs procedures apply on arrival in the EU, and UK customs procedures apply on re-import. Both legs of the journey now involve customs declarations, procedure codes, and potentially INF documents.
This has two effects. First, the admin burden of UK-EU OPR operations is significantly higher than it was before 2021. You need customs agents and declarations on both sides of the process. Second, OPR has become more commercially relevant for UK businesses processing in the EU, because duty relief is now something worth claiming, whereas before Brexit there was no duty to relieve.
Businesses sending goods to EU processors should make sure their EU-based customs agent or freight forwarder understands the UK OPR approval and can handle the EU import entry correctly. The INF document is important in this context because it links the UK export record to the EU entry.
OPR works the same way for goods sent to non-EU third countries. The process was always a customs procedure in those cases, even before Brexit.
Here is a scenario that illustrates how OPR works in practice.
A UK clothing manufacturer, let’s call them Hartwell & Co, produces a premium men’s suit line. They source wool fabric from a UK mill and cut the cloth in their Birmingham workshop. For the final tailoring, stitching, and finishing, they use a specialist garment factory in Porto, Portugal.
The fabric and cut pieces are worth £20,000 per shipment. After finishing in Portugal, the completed suits are worth £32,000. The processing cost, covering labour, lining, finishing materials, and the Portuguese factory’s margin, is £12,000. The applicable duty rate on finished suits entering the UK is 12%.
Without OPR:
Full import duty on £32,000 at 12% = £3,840 per shipment.
With OPR (proportional method):
– Value added abroad: £12,000
– Duty on full value: £3,840
– OPR relief: £3,840 × (£20,000 ÷ £32,000) = £2,400
– Duty payable: £3,840 − £2,400 = £1,440
Hartwell & Co saves £2,400 per shipment in import duty. Over 12 shipments a year, that is £28,800 in duty savings, a meaningful sum for a manufacturing business operating on tight margins.
To make this work, Hartwell applied for OPR approval from HMRC before their first shipment. They brief their UK freight forwarder on the procedure codes. They use an INF document to link each UK export to the corresponding re-import. And they track the approved time limit from each shipment date.
The extra admin takes time, but the duty saving justifies it.
What is the difference between OPR and temporary export?
A temporary export means the goods will return to the UK in substantially the same condition. OPR covers goods that will be processed or transformed abroad before re-import. If you are sending goods abroad for repair and they will return in the same basic condition, that may qualify as a simple temporary export or as OPR depending on the nature of the work. Your customs agent can advise on which procedure applies.
Can I use OPR for warranty repairs?
Yes. Warranty repairs are one of the most common uses of OPR. If you export goods to an overseas manufacturer or service centre for warranty repair and bring them back, OPR can reduce the duty on re-import. The time limit for repair is typically 6 months. You still need prior approval from HMRC.
Does OPR work for goods sent to countries outside the EU?
Yes. OPR applies to any country. Whether you are sending goods to Portugal, Turkey, Vietnam, or anywhere else, the UK OPR procedure works the same way. Post-Brexit, EU countries are treated the same as any other third country for UK customs purposes.
What happens if the compensating products are worth less than the original goods?
This can happen if the processing work adds less value than expected, or if there is wastage. In that case, the duty calculation is still applied to the actual customs value of the re-imported goods, and the OPR relief is calculated on the portion attributable to the original UK goods. Your customs agent should handle this correctly at the time of the re-import declaration.
Can I use OPR if my goods are partly UK-origin and partly imported materials?
Yes, but the relief only applies to the UK-origin portion of the goods. The imported materials element will not benefit from OPR. Your customs agent will need to split the value correctly and apply the appropriate procedure codes for each element.
What is an INF document and when do I need one?
An INF (Information Sheet) is a document that links the original export of goods under OPR to the subsequent re-import of the compensating products. You typically need an INF when the export and import are handled by different customs offices or different agents. It proves to the re-importing customs authority that the goods returning are the same ones that left under OPR. Your customs agent or freight forwarder will know when an INF is required for your route.
How long does OPR approval last?
HMRC approvals do not have a fixed expiry in all cases. The terms are set out in your specific approval. Approvals can be renewed. Check your approval document for the validity period and apply to renew before it expires if you intend to continue using the procedure.
Is OPR available to Northern Ireland businesses?
Yes, but the rules are more complex for Northern Ireland because of the Windsor Framework. Northern Ireland has a different customs position relative to both Great Britain and the EU. If you are based in Northern Ireland and sending goods abroad for processing, speak to a customs specialist familiar with the Windsor Framework before applying for OPR.
This article is part of a learning path — return to explore more topics.
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