This is necessary for all entrepreneurs who transport goods from abroad
Let's say you are a private entrepreneur. You bought a chair somewhere in China and want to sell it in your country. To do this, you must carry out customs clearance of the chair: pay duty, VAT, and other customs fees, pay the customs broker for services, and go through all the formalities. Only after that, the chair arrives in circulation on your territory, which means it can be sold.
If we are talking about business, customs clearance is always required for all goods. It doesn't matter what kind of product you bring, how much it weighs and what size it is.
The same applies to exports - if you decide to sell goods abroad, they must be "customs-cleared," i.e., go through customs procedures. For example, last year, one Ukrainian jewelry brand decided to open a branch in the USA. How we at M3Cargo helped him send jewelry to America, read here.
Whether it is profitable to bring goods from abroad can be calculated before the purchase
You need to contact a customs broker even before buying the goods. He will consider the approximate cost of customs clearance so you can understand whether it makes sense to import this product at all.
You can make a mistake trying to calculate this number by yourself. For example, you can forget to include duty or other payments in the cost price. As a result, the registration will be more expensive, and the product will already be purchased.
- what kind of goods you are importing or exporting;
- a link to it or full technical specifications with a photo;
- how many pieces, how much each product weighs, and the total weight of the lot;
- trademark and manufacturer;
- country of origin;
- terms of delivery;
- invoice value.M/li>
For the calculation, you need to provide the customs broker with the following data:
The broker will be able to approximately calculate the cost of customs clearance, based on which it will be possible to form the cost price of the goods. In this way, even before ordering, you will be able to understand whether it is profitable for you to import this product or not.
You will not be able to arrange the cargo entirely on your own
Customs clearance requires special customs brokerage software (a licence costs more than $200), customs accreditation, an electronic signature key (declaration can only be submitted online), and experience collecting customs declarations and working with documents.And you still need to read the Law on the Customs Tariff — it is the size of a whole book.
And you also need to choose the code correctly - a classification of goods according to which the customs service understands what you are transporting and what duty to charge you.
Suppose the client wants to bring a batch of children's cars. Even a children's car can have a different code, depending on what it is: a small toy car or a large one in which the child sits; soft, plush, or plastic. If you make a mistake, you can be accused of trying to reduce the amount of duty, which is a protocol for violating customs rules, and a fine.
Customs clearance of each cargo has its own nuances. For example, a phytosanitary certificate is required to import tea. For some goods, there is an assessment by an independent expert or quality certificates, a laboratory report, or other types of documents.
The cost of customs clearance consists of many components
- customs duty (it varies, depending on the product - from 0% to 15%);
- VAT (20% for most goods, or 7% if they are medical products);
- services of a customs broker, customs terminal, and related services.
The cost of customs clearance consists of:
For example, we recently cleared massage chair covers. Customs clearance costs $682, including all payments. The cost of customs broker services starts from UAH 1,000 — depending on the complexity of the goods. But it is still cheaper, easier, and faster than trying to issue all the documents yourself.
The customs clearance process does not depend on the country of import, but the customs duties are different
It doesn't matter where you bring the goods from — China, Europe, or other countries and continents. The set of documents depends only on the type of goods you are importing. However, customs duties when importing goods from different countries are different. In some situations, the duty may be higher than the product's value.
What documents are needed to start the customs clearance process:
If you make mistakes in the documents, you can get a large fine
Entrepreneurs are tempted to save on the services of a customs broker and try to process the goods themselves. But suppose a person has never engaged in foreign trade (foreign economic activity), instead of $200 for the preparation of documents, they can receive a fine equal to the price of the entire product.
In 2015, an entrepreneur we know brought goods for the first time and decided to prepare the documents himself. As a result, he did not declare about 50% of the goods in the documents. The customs office confiscated the "extra" goods and filed a report on the violation of customs rules against the businessman. He was fined in the amount of the value of the undeclared goods — and it was 5 million hryvnias. After court proceedings, the businessman was allowed not to pay the fine, but the confiscated goods were not returned. All this took about two years, and the businessman received the first half of the cargo, declared in the documents, only in 3 months. Customs clearance took so long.
Mistakes can be very different: someone forgets to accredit their company at customs, and someone wants to register without a contract. Someone brings air conditioners and wants to issue them without a licence, and someone forgets to specify pallets as packaging — problems can arise with this too.
There are often errors in the calculation of the customs value of goods. This is not only the price at which it was bought (indicated in the invoice) but also the transport costs on the way to the border. If you do not include this amount, you will face difficulties during customs clearance and even fines.
Before customs clearance, you need to issue a preliminary notification (PN)
This is a simplified customs declaration. It is drawn up by a broker so that a truck, container, or car with goods can enter the country and arrive at the customs terminal located on the territory of your country. Already after that, the process of customs clearance itself begins.
Usually, a customs clearance takes from 1 to 5 days
It depends on the complexity of the cargo and the number of goods.
Working with brokers and doing export or import can be a pleasure
If you order this service on turnkey from M3Cargo, we will take care of all the work with customs and save you from the hassle of documents. You won't even need to come to customs. All you have to do is wait for your goods. Every year we process more than 1,000 shipments from China, Korea, Taiwan, Europe, and the USA, so we know how to do it without any problems.
