Two procedures, one transit system
Under the Common Transit Convention (CTC), all movements run through the New Computerised Transit System (NCTS) using one of two procedure codes: T1 or T2. The procedure code determines how customs treat the goods during the movement and, crucially, what happens when the consignment arrives at the office of destination.
Getting the choice wrong is one of the most common reasons transit movements are delayed, controlled, or financially penalised. This guide walks through the practical differences.
T1: non-Union goods with duty suspended
A T1 declaration is used for goods that do not have Union status. In plain language, these are goods on which import duty and import VAT have not yet been paid in the EU. The T1 procedure allows them to move across CTC territory with the customs debt suspended rather than discharged.
Typical T1 scenarios:
- A container of Chinese electronics arrives at Felixstowe, is placed under transit, and is moved to a customs warehouse in Rotterdam before being released for free circulation in the EU.
- Cargo from Turkey enters the UK at Dover and continues under T1 to a consignee in Ireland who will pay the import duty there.
- Goods from a free zone are dispatched under T1 to an EU importer who will clear them at destination.
Because duty is suspended rather than paid, T1 movements carry the highest customs debt risk for the principal. The transit guarantee must cover the full value of the potential duty and VAT, which is why hauliers running regular T1 routes usually rely on a comprehensive customs guarantee (CCG) rather than buying individual guarantees per movement.
T2: Union goods preserving their status
A T2 declaration is used for goods that are already in free circulation in the EU — that is, duty and VAT have been paid, or the goods originate from within the EU. The T2 lets these goods cross a non-EU country (most commonly the UK or Switzerland) without losing their Union status.
Typical T2 scenarios:
- French wine moving from Bordeaux to Dublin via the Dover–Holyhead landbridge.
- Italian machinery moving from Milan to Madrid via Switzerland.
- Spanish citrus moving from Valencia to Helsinki via the UK.
Because the goods are Union goods, no import duty is at stake. The guarantee still applies, but in practice the risk is lower and the procedural treatment at the office of destination is simpler: the goods resume their Union status and can be delivered without an import declaration.
A side-by-side comparison
The two procedures share the same paperwork — both produce a TAD with an MRN, both move through NCTS, both require a guarantee, both have a time limit — but the customs consequences differ:
- Customs status: T1 = non-Union; T2 = Union.
- Duty at stake: T1 = full import duty and VAT suspended; T2 = none (goods are already in free circulation).
- At office of destination: T1 = goods must be entered to another customs procedure (free circulation, warehousing, etc.); T2 = goods released to free circulation automatically on discharge.
- Risk profile for the principal: T1 = higher; T2 = lower.
- Guarantee reference amount: T1 = typically the full duty and VAT value; T2 = a lower percentage in many cases.
Mixed loads and split consignments
A single trailer can carry both T1 and T2 goods. In that case, two separate transit declarations are opened — one T1 and one T2 — each with its own MRN and TAD. The driver carries both documents, and each is discharged separately at the appropriate office of destination.
This is common on the short Channel crossing where consolidators load groupage trailers with Union and non-Union goods bound for different consignees. Correct segregation in NCTS is essential. A T1 item declared under a T2 movement (or vice versa) is a misdeclaration and will be picked up either at an office of transit or, more painfully, on a post-clearance audit.
Documentation requirements
The supporting documents are largely the same for both procedures, but the proof of Union status is the critical difference for T2.
For a T2, the principal must be able to evidence that the goods are in free circulation. Acceptable evidence includes:
- A T2L or T2LF document
- An invoice or transport document marked with the appropriate Union status statement (for low-value consignments)
- A customs goods manifest for goods moving by sea between Union ports
For a T1, no Union status evidence is needed — the goods are explicitly non-Union — but the principal must be able to evidence the customs procedure or warehousing arrangement the goods are coming from.
Choosing the right procedure
The rule is simple, but worth stating plainly: the procedure code follows the status of the goods at the point the transit begins.
- Goods in free circulation in the EU at the start of the movement = T2.
- Goods not in free circulation in the EU at the start of the movement = T1.
A common mistake is to assume that because the goods are heading to an EU destination, they must be T2. This is wrong. A container of Chinese goods sitting in a UK customs warehouse and moving to Spain is T1 — the goods have never been in free circulation in the EU.
Talk to T2 Transit about your routing
Whether you are running pure T2 landbridge traffic, mixed groupage, or full T1 container moves through the UK, T2 Transit can set up the right declaration for each consignment, advise on guarantee structure, and handle the NCTS submission end-to-end. Get in touch with our team to discuss your specific routings and volumes.