Customs clearance is the general name for a series of procedures such as declaration, customs inspection, tax payment, and customs release at the port customs. Customs clearance means customs clearance, also known as customs clearance customarily. Goods are subject to customs supervision during customs clearance and cannot circulate freely. All cross-border packages need to go through customs. The customs will inspect each package. Prohibited items will be detained by the customs. If the value of the goods exceeds the tax-free standard, a tax will be imposed. Taxes paid normally will be refunded.
If the package is randomly inspected by the customs of the destination country and is not released immediately, it will need to pay taxes before it can be released. If the customs fails to release the goods, the buyer needs to cooperate with the customs for customs clearance. The fee paid by the seller to the logistics company is only the cost of delivery from the seller to the buyer, and does not include taxes and fees incurred by customs clearance
Some countries have customs clearance requirements
Yes Countries such as Brazil, Russia, Indonesia, and Argentina will experience varying degrees of delays in customs clearance. This must be explained to the buyer after the buyer places the order and before shipment, and an agreement can be reached before shipment.
1) Russia
In Russia, only Moscow and St. Petersburg have parcel services, and both the sender and the recipient must be companies. If either party is a private person, the destination has not been reached. The destination will be arranged to be returned on a collect basis
Russia does not accept abandoned parcels. If customs clearance fails at the destination, the express shipment will be arranged to be returned on a collect basis. The return costs will be borne by the sender
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2) Brazil
Brazil does not accept free abandonment. When customs clearance at the destination fails, if the sender chooses to abandon the shipment, he will need to pay at least 50 euros for each shipment. Piece fee, otherwise we will arrange return on collect.
All express items need to be accompanied by a customs number or a copy of the recipient’s passport or citizenship certificate, otherwise they cannot be cleared.
100% of express mails sent to Brazil will be inspected and taxed. If you use postal parcels, customs clearance will take a long time.
3) Indonesia
Goods exceeding 10kg will cause customs clearance delays. . If the value of the goods is declared low, a penalty will be required.
4) Argentina
Argentina has strict restrictions on personal online shopping of overseas goods. Each person cannot purchase more than 5 goods online per year. Therefore, the AliExpress platform no longer recommends sellers to set Argentina as the country of sale.
There is no channel for abandonment service
In the absence of abandonment service, once customs clearance fails, the goods will be returned and the sender will pay the return fee. FedEx: There is no abandonment service in Russia and the United States; in European countries, you need to check the local customs according to the specific shipment to confirm.
DHL: There is no abandonment service in Argentina, Slovakia, Latvia, the United States, Ukraine, Brazil, the Czech Republic, Poland, and Belarus.
Coping with Customs Detention
1. Reasons for Customs Detention
The main reasons for Customs Detention are as follows:. Buyers are unwilling to clear customs because they are taxed;
The goods are contraband in the importing country, or are fake or imitation goods; The importing country restricts the import of goods;
The seller cannot issue the relevant documents that the importing country requires from the seller;. The buyer cannot produce the relevant documents that the importing country requires from the buyer.
2. Negotiate with the buyer to cooperate with customs clearance
If the goods are taxed and the buyer is unwilling to pay the customs duties, the seller can negotiate with the buyer as follows:
If the importing country has strict tax requirements for goods, the seller should agree with the buyer in advance who will bear the cost if taxation occurs;
If no agreement is reached in advance, the buyer is unwilling to clear customs. , the seller can make certain concessions, such as each party paying half, or giving the buyer a coupon
If an agreement cannot be reached, the seller should try to retain evidence that the buyer is unwilling to clear customs. Provide information on disputes. Comprehensive consideration, if customs clearance fails, the seller will need to bear higher costs regardless of whether the goods are returned or abandoned, so try to get the buyer to cooperate with customs clearance
European import taxes and value-added tax
1. The concept of VAT
VAT stands for Value Added Tax (post-sales value-added tax). It is a tax system in the European Union and is a profit tax on the selling price of goods. It applies to imports, commercial transactions and services generated within EU countries. VAT consists of two independently paid taxes: sales value-added tax (SALESVAT) and import value-added tax (IMPORT VAT). When goods are imported to overseas warehouses in EU countries, import value-added tax will be generated on the goods, and when the goods are sold within their territory The sales value-added tax that will be generated
If the seller uses local warehousing in the EU country to deliver goods, it will fall into the scope of sales value-added tax payable, even if the overseas warehousing service selected by the seller is provided by a third-party logistics company. If you have never opened a local office or hired local employees, you will also need to pay VAT. In order to pay VAT in accordance with the law, sellers need to apply for a VAT tax number from the local tax bureau of the overseas warehouse. The VAT tax number is unique and only applies to registered parties.
According to EU tax laws, local VAT must be registered wherever the goods are stored. If the seller has registered British VAT, he can use overseas warehouses in the UK to express goods from the British overseas warehouse to buyers in other EU countries. However, this method has a limit. Each country requires different upper limits. After the limit is exceeded, You need to apply for a local VAT tax number. For cross-border e-commerce sellers, AliExpress, Amazon and eBay platforms have all made it mandatory to submit German and British VAT tax numbers
EORI is a customs clearance code, which is used when clearing goods. The format It is GB+VAT number +000. This registration number is required for individuals or companies with economic activities in EU countries, especially those with import and export business.
The C79 certificate is a tax refund form. The C79 contains detailed information on the import VAT payment. Only with the C79 tax form can you deduct the sales VAT tax that needs to be paid in the current quarter when reporting.
2. VAT tax rate policy
1) German VAT tax rate
Germany’s standard tax rate (Standard VAT) is 19%, which applies to most goods and services ;The low tax rate (FlatVAT) is 7% and applies to books, newspapers, food and agricultural products.
2) British VAT rate
The British standard tax rate is 20%, and import VAT can be deducted from sales tax. The low tax rate is 6.5% in the first year and 7.5% in the second year; sellers whose annual sales are less than 150,000 pounds in the first year and less than 230,000 pounds in the following year and thereafter can apply for a low tax rate, but they cannot be deducted Sales tax deducted
According to EU regulations, VAT is exempted when the value of the goods is less than 15 pounds or 22 goods customs. That is to say, direct mail products and packages with a price of less than 15 pounds can be exempted from VAT. However, it should be declared truthfully to avoid spot checks
3. Calculation method of VAT
Import value-added tax (IMPORTVAT) = (declared value + first-leg freight + import tariff) x VAT rate import Tariff = declared value x commodity tax rate (tax rates are different for different commodities)
Sales VAT (SALES VAT) = final sales price The sales price refers to the final price after the seller adds all expenses such as product cost, promotion fees, tariffs, value-added tax, and profits.
Actually paid VAT (value-added tax) = sales value-added tax (SALES VAT) – import value-added tax (IMPORT VAT)
4. VAT declaration cycle
1 )Declaration time in Germany
In Germany, you need to declare once a month and once a year. A total of 13 declarations are required in a year. It is necessary to provide the current month’s turnover (Amazon bill), other bills (logistics company bill, customs tax declaration), etc.
2) UK declaration time
In the UK, declarations are required four times a year, on a quarterly basis. Even if no sales are generated, zero declarations must be made on time. There will be penalties for failure to declare
The materials that need to be prepared when reporting include: input documents, that is, import VAT tax documents, C79 documents, or documents provided by logistics companies Bills; output documents, that is, bills issued to buyers, PayPal sales data or bank monthly statements; purchase and sales data; other documents that generate expenses locally.
5. How to apply for a VAT tax number
1) Apply for a German VAT tax number
According to the regulations of the German Federal Tax Office, overseas businesses and individual taxpayers must There is no tax exemption amount for local business and service activities in Germany. Regardless of the size of the business, it is necessary to register and declare to the German Federal Tax Agency in order to obtain a German VAT tax number and fulfill the corresponding tax declaration and payment obligations. The following sales methods are subject to German VAT:
The seller sells goods from a warehouse located in Germany to a buyer/consignee in Germany;
The seller sells goods from a warehouse located in another EU country Sales of goods to a buyer/consignee in Germany;
The seller sells goods from a third place (a country outside the EU) to a buyer/consignee in Germany, provided that the seller or his agent is responsible for the Customs clearance and tax filing for goods sold.
Information required to apply for VAT
You can apply for German VAT by yourself in mainland China and Hong Kong. The VAT application that needs to be submitted includes:
▲Company Business license, tax registration certificate, articles of association;
▲Relevant certificates of the company’s legal representative;
▲Report of the company’s controlling shareholder;
▲International remittance bank Account information;
▲Warehouse information and other related information;
▲VAT application form.
The above information needs to be translated into German. The German Tax Agency only accepts online reporting. The online reporting system is based on monthly reporting. Amazon sellers or eBay sellers must submit monthly sales from the date of sales in Germany to the present. After paying all previous tax payable, Only the German Tax Agency will issue a VAT tax number.
German tax-related tax number
German local tax number (Steuenummer): In most cases, this tax number is used for all taxes that the seller is obliged to register. The tax number consists of 10 to 13 digits and contains only numbers.
VAT number (Umsatzsteuer-Identifikationsnummer); the format starts with DE, followed by 9 digits.
German VAT registration certificate (Bescheinigung nach §22fUStG): This is a tax payment certificate, proving that taxes have been truthfully declared and paid
2) Apply for a British VAT tax number
Since December 1, 2012, according to the regulations of the British Revenue and Customs (HMRC), as long as overseas companies or individuals sell goods in the UK, regardless of the sales amount, they should apply for registration of a British VAT value-added tax number, and Pay post-sale VAT, unless these goods or services are exempt from VAT
1) Information required to apply for VAT
▲Company business license
▲ Relevant certificates of the company’s legal representative.
▲Sales products and sales status information.
▲VAT application form.
2) Who can apply
▲Self-employed and sole proprietor (Sole Proprietor).
▲Partnership.
▲Corporate Body
▲Association or Club (Club Association).
3) Self-application
Sellers can apply for a VAT tax number from the British government online or by mail.
If the seller does not have an office or business establishment in the UK, nor does he have a UK residence permit (NetPNon-Establisheo Taxable Person)NETP, he can only apply for VAT tax by mail. First download the “VAT application form” and ” Reminders for filling in the VAT application form.
Then, refer to Application for registration ((VAT1) Notes) (Reminders for filling in the VAT application form) and fill in the Application for registration (VAT1) (VAT application form) completely. Print, sign and mail to the designated address on the website
If the seller has a British office or British residence permit, you can apply for a VAT tax number directly online, and you need to register an HMRC account before applying.
In addition, you can also apply by mail. In the same way as the NETP application, download the VAT application form online, fill it out, print it, sign it and mail it to the designated address on the website.