Category: Customs & Taxes

Import Taxes and GST in Canada: By Munish Gupta

Posted on by Fredrik Gronkvist

Import Taxes Canada

Companies importing and selling products in Canada must generally pay import duties, GST, and GST/HST. In this guide, Munish Gupta from the Supply Chain Advisory Group explains what kind of taxes must be paid when importing goods to Canada – both for Canadian companies and foreign importers.

Continue reading Import Taxes and GST in Canada: By Munish Gupta

How to Import Products to the EU Using a Foreign Company

Posted on by Fredrik Gronkvist — 1 Comment

Import products to the EU

Importing and selling products in the EU, using a non-EU company, is possible. However, doing so requires that you get get a VAT and EORI number, and pay import taxes. You’ll also need to decide in which EU member country to register your non-EU company.

The hardest part is often knowing where and how to get started, but this guide by Munish Gupta, founder of Supply Chain Advisory Group, covers everything you need to know at an early EU market entry stage. Continue reading How to Import Products to the EU Using a Foreign Company

EORI Numbers for EU Importers: Questions & Answers

Posted on by Fredrik Gronkvist — 12 Comments

EORI Numbers for EU Importers

An EORI number (abbreviation for Economic Operator Registration and Identification) is assigned to businesses importing products to the EU. In this guide, we explain what an EORI is used for, how to apply for an EORI number, EORI applications for non-EU companies, processing time, and more.

Continue reading EORI Numbers for EU Importers: Questions & Answers

What is a Purchase Order and Proforma Invoice?

Posted on by Fredrik Gronkvist — 2 Comments

purchase order

Importers issue Purchase Orders (PO) as a formal procedure to state their intention to buy certain products, according to the terms specified in the PO. The supplier should then counter by issuing a Proforma Invoice (PI), stating their intention to sell the products to you according to the terms stated in the PI.

While this may sound like an outdated formality, understanding the Purchase Order and Proforma Invoice issuing process can help avoid severe misunderstandings – leading to quality issues, receiving the wrong product, or delays.

Overview

  • What is a Purchase Order?
  • What do I need to include in my Purchase Order?
  • How do I submit the purchase order to the factory?
  • Do I need to submit a Purchase Order before each production run?
  • Why do I need a Proforma Invoice from the factory?
  • What kind of information should the Proforma Invoice include?
  • How do I avoid payment fraud?
  • What is the difference between a Proforma Invoice and a Commercial Invoice?
  • Can I use the Proforma Invoice as proof of importation value?

Sample Documents

In addition, we also provide sample invoice documents:

  • Purchase Order Sample
  • Proforma Invoice Sample
  • Commercial Invoice Sample

Continue reading What is a Purchase Order and Proforma Invoice?

Customs & Taxes When Importing from China: US, EU, UK, Australia & Canada

Posted on by Fredrik Gronkvist — 83 Comments

Suggestion: Watch the 10 minutes video tutorial before reading this article

Understanding import duties, port charges, VAT, and other taxes is crucial when importing products from China, especially in a time when trade tensions are at an all-time high. However, each country or market has its own import duty rates and customs value calculation methods.

In this article, we explain what every Importer must know about import duties, customs valuation methods, and other taxes when importing products to the following countries and regions.

  • United States
  • European Union
  • Canada
  • Australia
  • New Zealand
  • United Kingdom

Continue reading Customs & Taxes When Importing from China: US, EU, UK, Australia & Canada

Importing from China to Australia: A Complete Guide

Posted on by Fredrik Gronkvist — 54 Comments

Suggestion: Watch the 10 minutes video tutorial before reading this article

Planning to import products from China to Australia? In this guide, we cover the basics that all Australian importers must know about product safety standards, labeling requirements, shipping options, and, the China–Australia Free Trade Agreement (ChAFTA).

In addition, you’ll also learn how to calculate import duties, import processing charges, and Goods and Services Tax (GST) when importing from China.

Overview

  • Product Regulations & Safety Standards
  • Shipping from China to Australia
  • Goods and services tax (GST)
  • Import Duties
  • China–Australia Free Trade Agreement (ChAFTA)
  • Import Processing Charge
  • Customs Value (CVAL)
  • Import Licenses and Permits
  • Total Import Tax Cost Calculation

Continue reading Importing from China to Australia: A Complete Guide

US-China Trade War Tariffs: An Essential Guide for Importers & Amazon Sellers

Posted on by Fredrik Gronkvist — 24 Comments

US-China Trade War

Like many others, I assumed the US-China trade war would be a short affair. I envisioned some deal involving mutual trade concessions taking place in a matter of weeks.

How wrong I was.

Now we are facing the prospect of a decade-long trade war, that will possibly mark the end of an era. Given that the United States is our main market, in terms of users, the trade war has a severe impact on our business too.

I’m not here to discuss which side is morally right or wrong. But I do have an obligation to share my views of how the US-China trade war may impact small businesses in the US, importing from China.

  • Why the trade war could massively benefit Chinese sellers
  • Which products are affected by the new tariffs?
  • Which products are not affected by the new tariffs?
  • What does this mean for US importers?
  • Will China or the US win the trade war?

The trade war also comes with some unintended consequences, that have the potential to backfire massively. Continue reading US-China Trade War Tariffs: An Essential Guide for Importers & Amazon Sellers

VAT on Imported Goods from China: A Complete Guide

Posted on by Fredrik Gronkvist — 97 Comments

Suggestion: Watch the 10 minutes video tutorial before reading this article

Imported from Asia to the EU, or selling cross-border? In this guide, we explain what importers, Amazon sellers, and cross-border e-commerce companies must know about the Value Added Tax (VAT) in the European Union.

We also collaborated with Alex Wyatt from SimplyVAT and Dr. Matthias Oldiges from KMLZ, two of Europes leading experts, to create this comprehensive VAT guide.

This is covered

  • VAT calculations for European importers
  • VAT rates in EU member states
  • How and when to pay VAT
  • VAT registration for EU companies
  • VAT registration for non-EU companies
  • VAT when dropshipping products
  • VAT when selling products online within the EU
  • VAT registration when selling from overseas to the EU
  • VAT when selling on Amazon

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What is Value Added Tax (VAT)?

The VAT is a consumption tax in the European Union. In B2C transactions, VAT is always included in the price. If you, for example, buy a product online from an EU based online store, the price you pay includes VAT.

The seller can then subtract the VAT paid on imports, from VAT added on top of the sales price.

Below follows an example:

  • Sales: $10,000 (Including VAT, 20%)
  • Expenses: $5,000 (Including VAT 20%)

This allows us to make the following calculation.

  • Sales VAT: $2,000
  • Paid VAT: $1,000
  • Total: $2,000 – $1,000 = $1,000

Thus, I would need to pay a VAT of $1,000. If I’d spent more on VAT than I added on top of my sales, I would instead get money back from the state.

Continue reading VAT on Imported Goods from China: A Complete Guide

Import Duties in Australia When Buying From Asia: An Essential Guide

Posted on by Fredrik Gronkvist — 1 Comment

Understanding the Australian import duty and tariff system, with many its exemptions and country of origin classes, can be rather complicated. In this article, we explain what Australian importers must know about import duty rates, HS codes, and tariffs:

  • Country of origin classifications
  • How to confirm the applicable HS code and duty rate for your product
  • Chapters and sections
  • How to (legally) reduce the import duty rate
  • When to pay import duties
  • How to calculate the customs value and import duty
  • Other import taxes in Australia

Continue reading Import Duties in Australia When Buying From Asia: An Essential Guide

Australia Import Processing Charge When Importing From Asia: A Complete Guide

Posted on by Fredrik Gronkvist

About to import products from China, Vietnam or elsewhere, to Australia? If the total importation value is above AU$1,000, you’ll need to submit an import declaration and pay an import processing charge of at least 50 Australian Dollars.

In this guide, we explain what Australian importers must know about the Import Processing Charge:

  • Import Processing Charge Overview
  • Reduced rates for warehoused goods
  • When and how to pay the Import Processing Charge
  • Exemptions, small volumes, and sample orders
  • Import Processing Charge for online purchases and private importers

What is the Import Processing Charge when importing from China, Vietnam or India?

The importing processing charge depends on the customs value (CVAL) and whether you submit the import declaration manually or online. However, unlike import duties which may differ depending on the country of origin, the import processing charge is always the same.

As such, you’ll pay as much for a shipment coming in from China, as one from Vietnam or any other foreign country. Continue reading Australia Import Processing Charge When Importing From Asia: A Complete Guide