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These significant cases in the process of customs inspection. Do you get it?

A company in Guangzhou purchase concentrated solution that contains the patent right from a foreign producer, who is the possessor of the patent right at the same time. After import, it is needed to be diluted with water before selling and then sell after packaging.

As one of the conditions in the sales process, this company needs to pay the disclosure fee to the producer, for obtaining the right of mixing and using this concentrated solution in the process of resale.

The figure of disclosure fee is calculated on the basis of the final sales price of the product.

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Since the company has to pay disclosure fee in order to obtain the concentrated solution, the disclosure fee is a condition of sales. 

Simultaneously, after the concentrated solution is imported, it is directly sold through simple processing, which already contains the patent right.

So, this disclosure fee should be included in the actually paid or payable price of imported goods.

The alteration between domestic and foreign investment, influencing tax reductions or exemptions policy. 

A company in Guangzhou formerly is a wholly foreign-owned company, imported a batch of equipment in the form of tax reduction or exemption in 2017, because it met the requirements of encouraged projects, in the catalog of Directory of Industrial Guidance for Foreign Investment.

When the customs inspected the company, it is founded that this company has changed it’s nature of enterprise on Mar 3, 2018, from a foreign-owned company to a joint-stock company, and foreign investment is less than 25%.

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According to the announcement regulation of no. 35 of the general administration of customs in 2007, some of the company’s equipment has not met the qualification for tax reduction and exemption. 

And this company didn’t handle procedures for subject change in customs with 30 days after issuance of a business license. The company’s above-mentioned behavior violates relevant regulations, and cause lower tax or tax leakage.

The company involved in tax reduction and exemption of importing goods may refer to two documents, “Announcement of the General Administration of Customs, No. 35 of 2007” and “Administrative Measures on Tax Reduction and Exemption of Customs Import and Export Goods of the People’s Republic of China“.

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• In the process of clearing custom, if there are any special relationships between seller and buyer, you should check special relationships items on the customs declaration form.

• Regardless of whether there is a situation in which the transaction price is affected by a special relationship.

• It is necessary to retain relevant information to support the relevant judgment, but it is not mandatory to submit relevant information to the customs at the reporting stage; if it is a maritime surcharge, it is declared in the import.

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• At the time, the shipping list provided by the shipping company was not obtained, and the declaration can be added to the customs after the amount is clear.

Frequently, some friends who do foreign trade always complain that the customs deducted goods, especially by the bulk cargo and samples of the express delivery sending to the customer, the goods were deducted. In fact, if the pre-prevention is proper, the probability of customs deduction is extremely small.

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• The difference between declared value and evaluated price

• The goods name disaccord with product

• No details in a packing list

• Consignee has no eligibility

• Personal items worth than 5000 RMB

• The relevant policy in local countries

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Generally, the major reasons why are you encountering inspecting and deduction?

• The difference between declared  value and evaluated price;

• Personal items worth than 5000 RMB

• The relevant privacy in local countries

• In order to prevent deduction from customs, you can mark the ordinary parcel as a personal gift, because it’s a small ratio for deducting by custom as a personal gift.

• Lower the declared price, for the deduction rate for valuables, is super high. Besides, after the customs deducts the goods, the customs clearance fee is calculated according to the declared value. The higher the declared value, the higher the customs clearance fee. Similarly, if you need to return the product to the customer, please also pay attention to let the customer write the value of the declaration a little lower.  

• Mastering all nations’ policies. For example, the clearance in Australia is easy, but there is a permit for battery type in custom. Therefore, battery and products with electromagnetism are relatively hard to pass the custom, trying not ship to Australia. If it’s necessary for selling products with battery, you can tell customers that the product in parcel with no battery for the policy.

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• Choose a safe delivery way. The DHL’s deduction rate is a little bit high, the second place is FedEx and UPS; the relatively safe delivery way is air parcel and EMS. Besides, even though the EMS is deducted by customs, is still can be returned back to the origin depot for free.

• The heavier of the parcel, the possibilities of deduction by customs is higher.

• Different products have a different rate of deduction by customs, like the rate of the electronic product is higher than cloths.

These measures are just to lower the chance of being deducted.

No deduction is impossible!

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