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Importing Goods to Australia
When importing goods to Australia, you or your company may be liable for customs duty and various taxes. In this article we discuss what those payments may be, and how they are applied.
Do imported goods need to be declared?
Yes. Australia’s Customs & Border Protection department requires the owner of the goods (this can be the actual owner, or someone that has control of the goods) to lodge an Import Declaration.
This declaration must be lodged electronically via the department’s Integrated Cargo System (ICS). If you have contracted a freight forwarder or customs broker to handle your goods import, they will be able to handle this for you.
Is there a customs duty threshold? How much is it?
Yes. All goods imported to Australia that have a value of over AUD$1000 are subject to duty, GST (Goods & Services Tax), plus other taxes that may be applicable according to the class of the goods.
Goods with a value under AUD$1000 may be cleared with a Self Assessed Clearance (SAC).
Along with an import declaration, any duties and/or taxes that are applied must be paid before the goods will be cleared by Customs.
How is the goods’ value calculated?
Most goods are valued by Customs & Border Protection at the transaction value – the cost actually paid, or payable when the goods are readied for export to Australia. This is then converted to Australian dollars (AUD) at the applicable market rate of the day.
How is the amount of customs duty calculated?
The amount payable is determined by the classification of the goods and other factors including exemptions, concessions & existence of preference schemes (e.g. a Free Trade Agreement between the origin country & Australia).
When importing goods, the submission of the declaration to the ICS will automatically calculate any duty, GST, Wine Equalisation Tax or Luxury Car tax payments that are required.
The owner will then be issued a payment advice that must be settled prior to the goods being cleared.
Is GST payable when importing goods?
Usually. Aside from a few exemptions for some foodstuffs and other items, most goods will be subject to GST when imported. GST is applied at 10% of the value of the goods when imported.
The value of the imported goods is equal to the goods value (as detailed above), plus the duty payable, and any transport & insurance fees for the goods.
Can GST payments be deferred or credited?
Yes. GST on a taxable importation is payable by all businesses, organisations and private individuals, whether registered for GST or not.
If your business or organisation is registered for GST, and it imports goods as part of its activities, you may be able to claim a GST credit for any GST you pay on those goods.
If you are an importer and registered for GST, you may be able to defer the payment by participating in the Deferred GST Scheme.
The scheme allows GST on taxable importations to be deferred until the first business activity statement lodged after the goods are imported. Participation in the scheme requires certain eligibility criteria to be met.
How We Can Help
For more information about GST Credits & Deferments on your company’s goods importations, please contact us