Undischarged transit movement – what to do when a T1 has not been discharged in the UK

An undischarged transit movement is one of the more serious operational problems in cross-border logistics — a situation in which a transit procedure (T1 or T2) was opened, the driver departed with the goods, but the NCTS (New Computerised Transit System) did not register the discharge of the movement at the office of destination. From HMRC's perspective the goods have technically "disappeared" — they left the UK under a transit procedure but never arrived anywhere according to the system records. In practice this happens more often than one might expect and has many possible causes: an error in presenting the MRN at the border, a NCTS system failure at the office of destination, a processing delay at the EU customs office, or in rare cases an actual loss or theft of the goods. Regardless of the cause, the consequences can be serious: HMRC automatically triggers the Inquiry Procedure, the transit guarantee may be called, and the business may receive a demand to pay a customs debt. This article explains step by step how to identify an undischarged transit, how to respond to an HMRC inquiry, how to prove the goods reached their destination, what the deadlines are, and how to prevent similar situations in the future.

What is an undischarged transit movement?

An undischarged transit movement is a situation in which:

1. A T1 or T2 transit procedure was opened in NCTS — an MRN (Movement Reference Number) was assigned, a TAD (Transit Accompanying Document) printed and attached to the goods
2. The goods physically left the office of departure (or an Authorised Consignor premises) under a customs seal
3. The NCTS did not record the discharge of the movement by the office of destination within the expected timeframe

When does HMRC treat a movement as undischarged? HMRC monitors all open transit movements automatically. If no discharge message has been received 5 days after the expected arrival date at the office of destination, the NCTS flags the movement as potentially undischarged. HMRC's National Clearance Hub (NCH) may then initiate the Inquiry Procedure.

Further information is available at GOV.UK — Check the status of a transit movement.

Why is a transit not discharged? Most common causes

Cause	Frequency	Resolution
Goods arrived but the driver did not present the MRN	Very common	Driver must return, or the office of destination must discharge the movement manually
Incorrect MRN (wrong number presented at the border)	Common	Verify with the opening customs agent; contact the office of destination
NCTS system failure at the office of destination (EU)	Rare	Office of destination issues a manual confirmation (fallback procedure)
Processing delay at the EU customs office	Rare	Request confirmation from the office; the matter may resolve itself within a few days
Goods arrived but the office of destination changed (TAD not amended)	Rare	Declaration amendment or new discharge required; contact HMRC
Actual theft or loss of goods	Very rare	Search procedure, transit guarantee update, police report

How does HMRC detect an undischarged transit?

The NCTS operates continuously and automatically matches open transit movements against discharge messages received from offices of destination. The sequence of events is as follows:

1. D+0: Transit opened — HMRC NCTS sends message IE029 (Release for Transit) to the agent/Authorised Consignor
2. D+5: If no IE045 (Unloading Remarks) or IE025 (Goods Released) received — NCTS flags the movement
3. D+7: HMRC NCH sends an Inquiry Notice (IE140) to the agent/Authorised Consignor — requesting an explanation
4. D+28: If there is no response to IE140 — HMRC initiates the formal Inquiry Procedure and contacts the office of destination
5. D+60: If after 60 days from transit opening there is still no discharge — HMRC may declare the movement breached and issue a customs debt recovery demand (C285)

How to respond to an HMRC Inquiry (Inquiry Procedure)

When HMRC sends an Inquiry Notice (IE140), you normally have 28 days to respond. HMRC's objective is straightforward: to establish what happened to the goods.

What you should do immediately upon receiving IE140:

1. Contact the customs agent who opened the transit — provide the MRN and despatch date, ask for a printout of the transit declaration and the NCTS status
2. Contact the carrier/driver — ask whether the TAD was presented at the office of destination, obtain proof of delivery (CMR, POD)
3. Contact the consignee — confirm that the goods physically arrived; ask for written confirmation of receipt with date and signature
4. Contact the office of destination (EU) — through your customs agent in the destination country; ask for confirmation that the goods passed through customs or that the movement is recorded in their system

Evidence accepted by HMRC as proof of end-use

HMRC accepts the following documents as evidence of lawful conclusion of the transit movement:

Document	Description
NCTS discharge confirmation (IE025/IE045)	Strongest evidence — a system message from the office of destination
Printout from the EU national customs system	Import clearance confirmation in the destination country (e.g. Polish SAD/PZC)
CMR + consignee signature (POD)	Proof of delivery — required as a minimum
Invoice with confirmation of receipt (signed invoice)	Supplementary — does not replace customs documents
Certificate from the EU customs office	Official letter confirming that the goods were cleared at a given customs office
Police report (in cases of theft)	Required if the goods were genuinely lost or stolen

Important: a CMR or invoice alone, without a customs document, is generally insufficient for HMRC. The strongest evidence is the NCTS system message or an official document from the office of destination.

What to do if the goods were genuinely lost or stolen

If despite your enquiries you cannot prove that the goods reached their destination:

1. File a police report — in the country where the loss was established (e.g. at the border or the delivery point)
2. Notify HMRC — submit the police report as evidence in the Inquiry Procedure
3. Transit guarantee activation — HMRC may demand payment of the customs debt corresponding to the duty and VAT on the value of the lost goods. If you hold a transit guarantee (comprehensive guarantee), it will cover the debt up to the reference amount
4. Insurance claim — if you have cargo insurance, file a claim — the police report and HMRC documents will be required as supporting evidence

Key deadlines in the Inquiry Procedure

Day	Event
D+0	Transit movement opened (IE029)
D+5	NCTS flags missing discharge
D+7	HMRC sends Inquiry Notice IE140
D+28	Deadline to respond to HMRC (from the IE140 date)
D+35	HMRC may initiate an enquiry to the office of destination (IE141)
D+60	Possible commencement of customs debt recovery proceedings
D+90	Final deadline for submitting evidence before a C285 is issued

How to prevent undischarged transit movements

The best strategy is prevention:

1. Brief your drivers — every driver must understand that the TAD (Transit Accompanying Document) MUST be presented at the office of destination. This is not optional. Many problems arise because drivers do not know they are required to call at a customs office.

2. Monitor MRN status — check the status of every open movement in NCTS regularly (you can do this through your customs agent or directly via the HMRC portal). Do not wait for IE140 to arrive.

3. Request discharge confirmation from the agent in the destination country — after every shipment, ask the destination country's agent for written confirmation that the transit has been discharged (IE025 or equivalent message).

4. Fallback procedures — ensure that your agents and drivers know the fallback procedure in the event of a NCTS failure: how to discharge a transit manually and what documents to retain.

5. Transit guarantee at an adequate level — maintain your guarantee at a level that covers the potential customs debt for all transit movements open simultaneously.