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What Conditions Are Required for Individuals Engaged in Foreign Trade Export Business to Apply for Export Tax Refund?
or complex compliance issues.
clearance and fund security.
I am an individual cross-border e-commerce seller. I rented a 10-square-meter small warehouse in Jiading District, Shanghai. Recently I sent two batches of self-purchased home storage products to Hamburg, Germany.
After customs clearance, the buyer has confirmed receipt of the goods and remitted more than 80,000 RMB back via PayPal. I heard from peers that individuals can also apply for export tax refund when doing foreign trade, but when I consulted the tax bureau, the staff said a large number of documents are required, and I only have the VAT general invoice for procurement and international express waybills, I have no idea what else is needed.
Besides, a friend of mine had his tax refund application rejected due to incomplete documents, and was marked "tax-related abnormality", which affected the subsequent withdrawal of store funds. I am really anxious now. I want to get the tax refund benefit I deserve, but I am afraid of making mistakes in the process and getting into compliance problems. Can you explain this to me in detail?
Lucas LiuYears of service：8Customer Rating：5.0
Senior Operations ConsultantStart a Chat
First of all，pre-document review shall be conducted，and three types of core materials shall be checked with emphasis: First，the special VAT invoice in the procurement link. The detailed commodity description and procurement date noted on the invoice must completely match the export goods，and general invoices cannot be used for tax refund declaration，Second，export customs declaration documents. Individuals need to entrust qualified foreign trade agencies to declare customs in dual-title mode，ensuring that the operating unit on the customs declaration is the agency and the consignor is the individual，Third，logistics documents. Sea/air bill of lading，express waybill and other documents shall be provided，and the logistics track must be consistent with the export port and destination country stated on the customs declaration.
Three key points need attention for the connection of core nodes: First，tax refund declaration must be initiated within 30 days after the electronic information of the export goods customs declaration is uploaded to the customs system，so as to avoid losing the tax refund qualification due to expiration，Second，a formal agency tax refund agreement must be signed when entrusting an agency，clarifying the rights and obligations of both parties and the responsibility of document storage，Third，foreign exchange collection must be conducted through compliant channels. If the payment is received through a third-party payment platform，bank flow records shall be provided to prove that the capital source is export payment.
In terms of abnormality contingency plans，if there is document missing or information inconsistency，supplementation and correction shall be completed within 15 days. If invoice red stamping is involved，a statement shall be submitted to the tax bureau simultaneously，if marked as tax-related abnormality，you need to submit business authenticity proof materials (such as platform orders，chat records) immediately to apply for removing the mark. After the final compliance approval，the tax refund will be directly transferred to the compliant bank account designated by the individual，and you need to ensure the account is in normal status.
Linda GaoYears of service：7Customer Rating：5.0
Documentation SupervisorStart a Chat
When individuals declare export customs, the dual-title customs declaration mode shall be adopted, that is, the operating unit is an enterprise with foreign trade agency qualification, and the consignor is the individual. It should be noted that the commodity code, name, quantity and weight on the customs declaration must be completely consistent with those on the procurement invoice and logistics documents. Incorrect code classification will directly lead to the rejection of tax refund declaration. In addition, individuals cannot handle export customs declaration independently, and must entrust an agency to submit the customs declaration application.
The electronic information of the customs declaration must be uploaded to the customs system within 72 hours after export, and delayed upload will affect the timeliness of tax refund declaration. If you encounter customs price verification doubts, you need to provide procurement contracts, payment vouchers, market price reports and other materials to prove the authenticity of the declared price, so as to avoid the stagnation of the tax refund process due to failed price verification.
Cindy ChenYears of service：3Customer Rating：5.0
Key Account ManagerStart a Chat
Individual export tax refund needs to meet two core tax conditions: First, the export goods are within the taxation scope of value-added tax and consumption tax, and the corresponding taxes have been paid; Second, the goods have actually cleared customs, left the territory and been sold to overseas units or individuals. If an individual sells goods through a cross-border e-commerce platform, it is necessary to ensure the consistency of three documents: platform order, customs declaration and foreign exchange collection certificate, so as to avoid being recognized as domestic sales and taxed.
In addition, individuals cannot directly apply for tax refund to the tax bureau, and must entrust a foreign trade agency with export tax refund qualification to handle the procedure on their behalf. The agency needs to submit the agency tax refund agreement, individual identification and other materials to the tax bureau, and transfer the tax refund to the individual account after declaring the tax refund in the name of the agency. It should be noted that the tax refund declaration deadline is before the closing of the VAT declaration period in April of the next year counting from the export date, and no tax refund can be processed after the deadline.
Andy GuoYears of service：3Customer Rating：5.0
Supply Chain Management ExpertStart a Chat
Individual export foreign exchange collection must be conducted through compliant channels. If you use a third-party cross-border payment platform (such as PayPal, Stripe), you need to note "export payment" when withdrawing the payment received from the platform to your individual domestic bank account, and keep the platform order screenshot and withdrawal voucher as proof of foreign exchange collection.
If there is a difference between the collected amount and the amount on the customs declaration (for example, due to exchange rate fluctuations, deduction of platform service fees), you need to submit a difference description material, so as to avoid being identified as having capital backflow risk. In addition, individuals are not allowed to directly transfer the foreign exchange collected from an offshore account to a domestic private account.
They must settle foreign exchange through formal channels to ensure the compliance of the collected funds. If the foreign exchange collection is delayed, you need to submit a foreign exchange collection commitment to the tax bureau before tax refund declaration, promising to complete the collection within the specified period, otherwise you need to repay the received tax refund.
Kevin LinYears of service：4Customer Rating：5.0
Trade Solutions ManagerStart a Chat
The document filing for individual export tax refund must comply with the requirements of the tax bureau. Materials such as procurement contracts, export customs declarations, logistics bills of lading, foreign exchange collection certificates, and agency tax refund agreements need to be retained, and the filing period is 10 years after tax refund declaration.
If the tax bureau initiates a correspondence investigation, you need to submit business authenticity proof materials within 15 days, including order records on the cross-border e-commerce platform, communication records with overseas buyers, and warehouse in-out vouchers for purchased goods. It should be noted that if there are situations such as false invoicing and document forgery, you will be listed as a tax-related dishonest person, which will affect personal credit and subsequent foreign trade business development.
In addition, individuals need to cooperate with the agency to complete the verification of the pre-declaration of tax refund. If there are doubts in the pre-declaration, you need to correct them in time before formal declaration, so as to avoid the rejection of the formal declaration.
Jason WuYears of service：10Customer Rating：5.0
International Logistics & Supply Chain ManagerStart a Chat
When an individual signs an agency tax refund agreement with a foreign trade agency, clauses such as document storage responsibility, tax fund transfer time, and handling methods for abnormal situations must be clearly agreed, so as to avoid disputes caused by vague agreement clauses. It should be noted that the agreement must clearly specify that the agency is only responsible for handling tax refund procedures, and does not bear responsibilities for cargo quality, logistics risks and other issues.
At the same time, it is necessary to agree on the compensation liability for tax refund failure caused by the agency's operational error. In addition, individuals need to retain all legal documents related to foreign trade business, including procurement contracts, sales contracts, logistics entrustment agreements, etc. If there is a tax or customs dispute, these documents can be used as proof of business authenticity. If the export involves intellectual property-related goods, it is necessary to ensure that the goods have obtained legal authorization, so as to avoid the tax refund being recovered due to infringement issues.
Evelyn LiYears of service：3Customer Rating：5.0
Cross-border Compliance SupervisorStart a Chat
The logistics track of individual export goods must completely match the information on the customs declaration, including export port, destination country, cargo weight, volume and other information. If the logistics track does not match the customs declaration, it will directly lead to the rejection of the tax refund declaration.
It is necessary to select qualified international logistics enterprises, so as to avoid invalid logistics documents caused by using unqualified freight forwarders. In addition, if the goods require transshipment, a transshipment certificate from the transit port must be provided to ensure the integrity of the logistics track.
If there are situations such as cargo detention at the port or customs detention, you need to submit a description material to the customs in time, and notify the agency to adjust the tax refund declaration time, so as to avoid being unable to apply for tax refund due to expiration. It should be noted that the original or electronic scanned copy of logistics documents must be retained as important supporting materials for tax refund declaration.