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Thread: Importing and claiming back VAT

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    Question Importing and claiming back VAT

    Hi all,

    I'm hoping someone can help with my query.

    I run a VAT registered company that mainly deals in digital goods. We've got an importers license.

    We've decided it may be beneficial to bring in some physical goods from the US, and I'm not entirely sure what the best way to go about it is. The items are relatively small and light, and from my research will only attract VAT (no applicable duties, since they're basically just plastic cards) - which we should be able to claim back. The supplier is offering free shipping, and since it's fairly small, it's like just going to come through EMS or a similar service (still to be confirmed). My question is, will a courier service like EMS handle the clearing of the items, and will they request details such as our importers license and VAT number to invoice us for the service, as well as the VAT charged on the items?

    My main concern is that we pay the VAT, and then SARS denies the VAT refund due to some silly missing piece of documentation. I know I really should deal with a clearing agent, but the total value is fairly low, and we aren't buying in huge amounts, so it would be (presumably) more cost affective to use the couriers themselves to process everything.

    Has anyone had experience dealing with EMS or the like in a commercial capacity, or can recommend a cost affective route to follow?

    Any help will be most appreciated!

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    Even if it is a postal item, you get an official VAT invoice from the Post office. This is a valid document to claim VAT with.
    The challenge is in your accounting system, you may have to change a setting to enable to have a larger value in the VAT column as with the normal invoicing where the VAT calculated is 14% of the invoiced amount.
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    Okay, so I can provide my company details to the post office when I go pick up the parcel, and they will invoice the company for payment? I also see mention of a SAD500 form every now and then, although I'm not sure at what point this is completed. Will EMS request this when it reaches customs?

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    Whoever acts as clearing agents will invoice you for the import Vat. The Vat is based on the value as per the commercial invoice attached to the parcel. So the "agent's" invoice will reflect the two vat charges; the import VAT as a line item and then vat on their services in the normal manner.

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    Quote Originally Posted by CLIVE-TRIANGLE View Post
    Whoever acts as clearing agents will invoice you for the import Vat. The Vat is based on the value as per the commercial invoice attached to the parcel. So the "agent's" invoice will reflect the two vat charges; the import VAT as a line item and then vat on their services in the normal manner.
    So EMS won't act as the clearing agent? I may have posted this in the wrong forum section, or not worded my question correctly. I understand how the invoice would look and how to claim on it, my concern is ensuring compliance with SARS and Customs in regards to the actual import process and documentation so that the final VAT refund won't be denied, and whether it can be done solely through the post office.

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    I think the documentation needs to be the "bill of entry (SARS Customs declaration forms DA500, CCA1 or SAD)". Not sure if EMS does this, and if so, whether they will contact us to ensure they have the right information, like importers code.

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    Quote Originally Posted by Praemon View Post
    So EMS won't act as the clearing agent? I may have posted this in the wrong forum section, or not worded my question correctly. I understand how the invoice would look and how to claim on it, my concern is ensuring compliance with SARS and Customs in regards to the actual import process and documentation so that the final VAT refund won't be denied, and whether it can be done solely through the post office.
    No matter who you use, you won't get the merchandise until the import vat is paid, whether by courier, post office or courier's appointed agent, and they will charge you. They ensure compliance with SARS and customs, because the latter will not release the merchandise otherwise.
    Your obligations in terms of the VAT act is to have a valid tax invoice for all input vat claimed, which you will get from whomever you use. I think you are foreseeing difficulties that actually aren't there

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    Quote Originally Posted by CLIVE-TRIANGLE View Post
    No matter who you use, you won't get the merchandise until the import vat is paid, whether by courier, post office or courier's appointed agent, and they will charge you. They ensure compliance with SARS and customs, because the latter will not release the merchandise otherwise.
    Your obligations in terms of the VAT act is to have a valid tax invoice for all input vat claimed, which you will get from whomever you use. I think you are foreseeing difficulties that actually aren't there
    I think I might be too but it's difficult not to when it comes to SARS and their requirements. :P

    Thanks for the information. Much appreciated.

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