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Understanding HS code: A Comprehensive Guide

For transporting goods and determining what type of goods are there we need a system. This system is named the Harmonized System of Coding. It has digits that help identify the product description. In customs trading, you require some unique identification to make import/export simpler and quick. Investors and inspection teams use the Hs code method through which the verification becomes easy. The Harmonized Commodity Description and Coding System (Hs code) is a widely used classification scheme for trading items. Here, we are going to study Hs coding techniques.

What is the Harmonized System of Coding (Hs Code)?

A standardised international system for classifying and identifying commodities in international trade is called the Harmonized System of Coding (HS).”

 

In more than 200 nations throughout the world, customs authorities are familiar with this six-digit code. This coding system was introduced in 1988 by the WCO (World Customs Organization). The World Customs Organization created the HS to offer a standardised and organised method of categorising commodities for customs purposes. 

 

The system is based on a hierarchical structure in which goods are first classified in accordance with their broadest characteristics, such as their material composition or intended use, and then further categorised in accordance with their more specific characteristics, such as their size, shape, or function.

 

The coding system has gone through several changes in the classification of products. It occurred in the years 1996, 2002, 2012 and 2017. 5300 product descriptions that exist in headings, subheadings, 99 chapters, and 21 sections are covered in Hs.

Why is Hs code Required?

There are indefinite reasons why these Hs codes are required. Some of the reasons include:

 

  • Customs declaration: Clearance of customs is required when goods crosses an international boundary. The right tariffs, taxes, and levies should be applied to the products, according to customs officials with the use of HS codes. This is crucial to prevent the importation of restricted or forbidden goods and to make sure that the government receives the appropriate amount of tax money.
  • Trade statistics: HS codes make it easier to follow the movement of commodities between nations, which is critical for gauging global trade and economic expansion. Governments, corporations, and international organisations use trade statistics to help them make well-informed policy choices. 
  • Regulation of products: Products that pose threats to consumer health, safety, or the environment can be regulated using HS codes. For instance, the usage of HS codes helps to ensure that products like chemicals, pharmaceuticals, and food are properly identified and regulated since they need certain regulatory permits.
  • Access to markets: In order to enhance market access, HS codes are frequently utilised in international trade discussions. Countries can guarantee that their products are correctly categorised and that they have fair and equal access to each other’s markets by agreeing on HS codes.


Although these Hs-codes are used worldwide, here our main focus is on Hs code UK. Gov.UK has created a platform for its users to detect and get accurate Hs codes UK with respect to their goods. This platform will help you get the customs Hs code. The HMRC HS codes is a huge platform specially designed for importers and exporters of the UK. In this regard, iCustoms gives you an opportunity to make your customs work easy for both importers and exporters. Templates, easy format and simple steps enable you to save time and money.

How to Use a Hs code Finder to Identify HS Codes for Your Goods?

A programme or piece of software called a “harmonised code finder” enables customers to look up the correct HS code for their particular goods.

 

A list of potential  UK Hs codes that fit the product description is often generated once a description of the item is entered. Businesses that export or import products may find this tool valuable as it can help ensure the proper HS code. Further, it will be used to calculate taxes and tariffs correctly. 

Both the terms such as Hs code finder and Hs code checker are the same. But, it varies upon the state as every country’s government has now developed its own platform. What we need to understand most is how it works. There are five simple steps:

 

  • Product Description: Giving a thorough description of the product you want to categorise is the first step. This could include its construction material, intended use, size, and any other pertinent information.
  • Choose a harmonized code finder: Several standardised code finder tools, including those offered by customs officials and private businesses, are accessible online. Pick one that applies to your nation and industry.
  • Input the description: Enter the product’s description into the harmonised code finder tool. Be sure to be as thorough and precise as you can.
  • Review the results: A list of potential HS codes that fit your product description will be generated by the programme. Examine each code to see which is best for your goods.
  • Check the code: Once you’ve determined the exact code, confirm its accuracy with your customs department or a customs broker.

Example

In order to find Hs code for the product name “Frank Body Cherry Lip Scrub 15ml”. The first step you take is to go to the trade-tariff website. One thing you need to keep in mind is that you get the exact product description in the tariff but 98% accuracy as codes are basic and general.

 

Moving Forward, you can search for your product prior to getting the code and then type the major keyword from the product name. From the demo, we get the basic idea that it is a cosmetic product used for lips. You either type cosmetics, beauty or lip balm to be more specific. You have to type the word in the box as per image section 1.

 

On clicking enter it will take you according to your keyword direction. Following the code structure will lead you to the correct UK Hs code of the item as per section 2 in the image.

Hs Code

Classification of Hs Code (HS2, HS4 and HS6)

The Harmonized System (HS) code has a total of ten digit code. From these ten-digit codes, there are three levels of classification i.e HS2, HS4, and HS6. The first two digits of the HS code, which offer a broad categorisation of the product, are referred to as HS2. For instance, HS code 62 applies to garments and accessories while HS code 70 applies to jewellery.

The first four digits of the Hs code, or “HS4”, give the product a more precise classification. For instance, HS code 6204 applies to “Women’s or girls’ suits, ensembles, jackets, blazers, dresses, skirts, divided skirts, trousers, bib and brace overalls, breeches and shorts (other than swimwear)”, while HS code 7117 designates to imitation jewellery.

 

The most thorough classification of the product is provided by the first six digits of the Hs code, which are referred to as HS6. In contrast, HS code 7117 11 refers to cufflinks and studs and Hs code 6204 11 refers to women’s or girls’ suits made of wool or fine animal hair.

 

HS Codes in International Trade

 

The various HS categorization levels have diverse applications. HS4 and HS6 codes provide precise information which is beneficial for enterprises involved in international trade, customs officials, and policymakers. HS2 codes are useful for gaining a broad overview of international trade in many product categories.

 

The first six digits are globally recognized and the same but the last four digits vary from country to country. It is because each nation has the freedom to alter the code to suit its unique requirements and internal laws. The first six numbers, however, are constant throughout all nations that employ the HS system. iCustoms provide you with the ease of getting the UK-specified codes for both imports and exports. 

Conclusion

The HS codes are vital in customs declaration because one has to specify the products which are exported or imported for inspection and validation. The Harmonized code gives you the advantage of switching to different names of the same product to specifying the same product of different descriptions in one code. These are easy to validate and remember and are worldwide known which makes it easy for importing and exporting.

 

iCustoms is rapidly growing in the customs world because of its merging and advanced AI. It uses the HMRC HS coding method which is proven to give 99% of accuracy and precision. Our software cross-checks the submitted documents before finalising them to avoid mistakes which become a reason for rejection.

About iCustoms

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