In short: Inward Processing Relief (IPR) lets Irish and EU importers suspend or reclaim customs duty and import VAT on goods brought in from China or Vietnam, provided those goods (or products made from them) are eventually re-exported outside the EU. For Irish businesses that process, repackage, or manufacture using Chinese components before selling into UK, US, or other non-EU markets, IPR can mean never paying duty on that portion of the goods at all, rather than paying and waiting for a refund.

What Is Inward Processing Relief?

Inward Processing Relief is a Revenue and EU Customs procedure that allows businesses to import goods from outside the EU, such as China or Vietnam, without paying customs duty or import VAT upfront, as long as those goods are processed and then re-exported outside the EU customs territory within a set time frame. It's the EU and Irish equivalent of what US importers know as duty drawback, except IPR usually suspends the duty before it's paid, rather than refunding it afterward.

Processing under IPR is defined broadly. It covers manufacturing a new product, assembling components, repackaging, relabelling, or even repairing goods, which makes it relevant to a wide range of Irish importers beyond straightforward manufacturers.

Who Should Be Using IPR?

IPR is worth investigating if your business does any of the following with goods sourced from China or Vietnam:

• Imports components or materials and manufactures or assembles a finished product in Ireland for sale outside the EU
• Imports finished goods, repackages or relabels them for a non-EU client or market, then re-exports
• Acts as a distribution hub, bringing goods into Ireland before shipping a portion onward to the UK or further afield
• Imports goods for testing, repair, or quality rework before sending them back out of the EU

If none of your imported goods ever leave the EU after processing, IPR won't apply. But for Irish businesses using their location as a bridge between Asian manufacturing and non-EU markets, it's one of the more underused reliefs available.

How Does IPR Actually Save You Money?

Under standard import rules, you pay customs duty and Ireland's 23% VAT rate at the point of entry, based on the full customs value of the goods, the same rates covered in our Ireland import duty and VAT guide. Under IPR, that duty and VAT is suspended rather than charged, provided you have authorisation in place before the goods arrive and you re-export within the agreed time limit, typically up to 12 months, though this can be extended for certain goods.

Here's how that plays out on a realistic shipment:

That cash flow difference is the real advantage of IPR over a drawback-style refund: your money isn't tied up at the border waiting for a claim to process.

What Do You Need to Get Authorised?

You'll need to apply to Revenue for an IPR authorisation before you start importing under the procedure, alongside the standard registrations covered in our EORI number guide for Irish importers and our customs clearance walkthrough. Revenue will want to see:

• A clear description of the processing operation you'll carry out in Ireland
• Evidence of your intended re-export market and realistic export volumes
• A system for tracking which imported goods correspond to which exported products (the "bill of discharge")
• Proof of your ability to maintain the records Revenue requires throughout the authorisation period

For straightforward, repeat import-process-export patterns, a simplified authorisation is often available, which cuts down the paperwork considerably compared to a full application.

How Do You Close Out an IPR Claim?

Every IPR authorisation requires a "discharge" within the agreed period, where you report to Revenue exactly what happened to the imported goods. If everything was processed and exported as planned, the suspended duty and VAT is simply written off. If some goods were sold domestically into the EU instead of exported, duty and VAT become payable on that portion at the point of discharge, calculated on the original customs value.

This is why accurate tracking from day one matters more under IPR than under a standard import: the system is built around proving what left the EU, not just what arrived.

Frequently Asked Questions

Is IPR the same as duty drawback?

They achieve a similar outcome, recovering duty on re-exported goods, but IPR suspends duty before payment while drawback (used in markets like the US) refunds duty already paid. IPR is generally better for cash flow since the money never leaves your account in the first place.

Can I use IPR if I only export part of what I import?

Yes. You only need to pay duty and VAT on the portion that stays in the EU, which is calculated and settled at the discharge stage of your authorisation.

How long does an IPR authorisation take to set up?

A simplified authorisation for routine, repeat processing operations can often be in place within a few weeks, while a full authorisation covering more complex processing may take longer depending on Revenue's review.

Does IPR apply to goods sourced from Vietnam as well as China?

Yes, IPR applies based on the goods being imported from outside the EU, regardless of whether the country of origin is China, Vietnam, or elsewhere, which matters for Irish importers increasingly dual-sourcing across both countries.

What happens if I don't re-export within the time limit?

Duty and VAT become payable on the goods that weren't re-exported, generally along with interest, so it's important to set a realistic authorisation period that matches your actual sales cycle before applying.

How Epic Sourcing Helps

We work with Irish importers every day who are juggling exactly this kind of cross-border complexity, sourcing components from our bilingual teams on the ground in China and Vietnam through our end-to-end sourcing service, then figuring out the most tax-efficient way to bring them into Ireland for processing and onward sale. If you're weighing up whether IPR fits your supply chain, talk to our team and we'll help you think through the sourcing side so your customs adviser has clean numbers to work with on the Revenue side.

Last updated: November 5, 2026