Monday, 2 February 2009
International Trade Compliance Can Increase Profit!
During these uncertain economic times most companies are looking at their expenditure and ensuring that any major expenses are reduced. However, one area that is often overlooked is International Trade Compliance and namely the duty and tax they pay on imported goods!
Most people know that duty is calculated on the CIF value: -
- Cost of Goods
- Insurance
- Freight costs
- Understanding the correct build up for duty and VAT.
- Knowing what must be added?
- Knowing what can be deducted?
- Checking that the goods are correctly classified.
- Knowing what happens to the goods after import.
When we ask a prospective client who is responsible for their International Trade Compliance? The most common answer we hear is "Our Freight Forwarder takes care of that". However, importers should be aware that it is their responsibility to be and remain customs compliant. Not only could they be non compliant by relying upon their forwarder, but they could also be spending money unnecessarily.
Importers can reduce the risk of non compliance or incorrect duty payments by: -
- Ensure that any compliance instructions are followed by your forwarder
- Check that insurance is always declared?
- Check that all the supplier invoices declared?
- Check the right currency used?
- Asking if the duty/VAT entry value build-up reflect the terms of sales?
- Check that the correct entry procedure is used?
- Check that any multiple origins are declared?
- Make sure your forwarder does not use a ‘catch all’ classification?
Labels: Customs Compliance, Global Trade Management, International Trade Compliance
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