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Thread: Setting up micro enterprise for importing goods

  1. #1
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    Setting up micro enterprise for importing goods

    Hi All,

    some advice if you please.

    I am setting up a micro enterprise for the import of products. Thus far it will be too small so VAT registration is a non starter for now.
    However as we import the components and assemble locally I guess the following is required

    1. Import license/code (I assume this can be used for export to SADC countries as well?) Is this a mission for my accountant to do?
    2. How would I go about ensuring I am not hit with the maximum import tariffs since I do final assembly of the finished product locally? (got hammered with full tariff on sample imports, even the gratis stock I received as part of first shipment) Do I need to register with SARS for this purpose?
    3. Bonded warehousing. Does anyone have any experience or knowledge of this in small quantities?

    Sorry for the palooka questions, I am starting this venture on a shoe string and this requires that any and all methods to improved cash flow are vital to success.

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    Hi

    1. You should get 1 code for import and export but make sure that you specify that you want to be able to do both so this is eflected against the registration number.You may have to register yourself - not through a 3rd party. This is done SARS / Customs in Cape Town - not at all SARS offices do the registrations. The application forms and supporting documentation information is on the SARS website. You do need to have everything they ask for or you will be making another trip......

    2. You will need to check what tariff code is applicable to the product you are importing. If you are using a freight forwarder you will give this code to them with the clearing instructions. Not sure where you are importing from/ what you are importing but different rates may be applicable if we have preferential trade agreements from country of export. (Additional paperwork may be required.) Your supplier should be able to give you the tariff code to be used - the first 4 (or 6?) numbers are international and the last few may be country specific.

    3. You will need to check if a bonded warehouse makes sense in terms of the duty you pay so ideally check your duty first. (I have no experience of bonded warehousing but your freight forwarder may offer this.)

    No VAT expert but you are charged VAT on imports so may be worth registering. I would check this with your accountant.

    Hope this helps.

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    As far as duty is concerned, any item which comes in, whether a sample or not will be charged import duty. When samples are supplied by your customer, let them insert a small amount as the value of the sample, and the duty will be calculated on this. SARS reckons that even a sample may be sold by you in this country and hence the reason for the charging of the Duty. If the sample item comes with no value, SARS then checks up what the approximate cost is and thereby calculates the duty.

    Bonded warehouse will attract storage rent and insurance, and every time an item is collected the shipper will charge clearing fees. Please check with your local shipping company for their rates.
    Victor - Knowledge is a blessing or a curse, your current circumstances make you decide!
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    Thanks, Yeah figured out the sample issue, Mine were charged art $0 therefore attracted the full value tariff. Rookie error, they should have been charged at $5.

    Re Bonded I have found a courier that will handle the import, as well as the local distribution. As an value added service they can warehouse the goods (at a nominal cost) and ship directly from their warehouse. This would be equivalent to the rental on bonded goods. It may be an attractive option on my 3rd shipment once my supply chain is more effective. Really glad I found them, great little company.

    thanks for the input.

    Ko

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