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How to Realize Full-Process Compliant Operation of Huizhou Transit Trade and Avoid Core Customs Clearance and Tax Risks?
or complex compliance issues.
clearance and fund security.
I am the person in charge of an industry and trade enterprise in Dongguan mainly engaged in chip capacitor business. Recently, the EU's anti-dumping duty on Chinese chip capacitors has risen to 28%, which directly erodes our already meager profits.
I want to adopt Huizhou transit trade to avoid the duty, but I have never operated transit business before. Peers told me that the transit process of Huizhou Port is different from that of Shenzhen Port. Minor errors in documents will not only cause port detention and customs seizure, but also may trigger tax inspection.
My 20GP shipment is to be loaded next week, and I am so anxious that I cannot sleep. I am afraid that missing details in document review will lead to cargo detention, and also worry about loss of goods title control during transit and unclear cost calculation. I would like to ask how to operate it properly?
Michael ZhangYears of service：6Customer Rating：5.0
Customs Declaration & Compliance ExpertStart a Chat
First，preliminary document review details: focus on checking the Certificate of Origin，commercial invoice and packing list provided by the transit country supplier，to ensure 100% consistency between document information and the model，quantity and weight of the 20GP chip capacitors. In particular，avoid the risk of implicit "Made in China" markings on the Certificate of Origin. Meanwhile，complete the transit trade filing with Huizhou Customs 3 working days in advance and submit the goods transit explanation letter.
Core node coordination: for the logistics end，select the designated yard of Huizhou Port with transit supervision qualification. After arrival，the goods shall directly enter the supervised warehouse，and landing and entering the territory is prohibited. For the document end，special personnel shall coordinate with customs brokers，freight forwarders and transit country agents simultaneously，to ensure bill of lading endorsement and manifest submission are completed within 24 hours. Eliminate port detention risks caused by delayed manifest information.
Contingency plan: for document discrepancies，prepare pre-audited backup documents in advance. In case of customs inspection，immediately activate the supplementary Certificate of Origin certification from the transit country supplier. In case of goods title disputes，lock the goods title relying on the third-party supervised warehouse of Huizhou Port. It is prohibited to directly endorse the bill of lading to overseas buyers.
Final compliant implementation: after transit is completed，submit the full set of documents from the transit country，Huizhou Port transit certificate and logistics manifest to the bank simultaneously to complete foreign exchange receipt and payment. All documents shall be filed separately and kept for more than 5 years，to ensure a closed loop of tax and foreign exchange compliance.
Lucas LiuYears of service：8Customer Rating：5.0
Senior Operations ConsultantStart a Chat
Customs declaration for Huizhou transit trade shall strictly follow the principle of "transit goods not entering the territory". The customs declaration form shall accurately select the "transit trade" supervision mode (code 0110), and clearly indicate the transit destination port and transit country supplier information in the remarks column. If the information on the customs declaration form is inconsistent with the manifest, apply for cancellation and re-declaration within 24 hours after the goods arrive at the port, to avoid triggering customs valuation warning.
For customs valuation disputes, prepare the purchase contract with the transit country supplier, foreign exchange payment voucher and international market price evidence for the same batch of goods in advance. It is prohibited to reduce transit costs by under-declaring goods value, otherwise the enterprise will be included in the customs key monitoring list, and the customs clearance efficiency of subsequent transit businesses will be extended by more than 30%.
Cindy ChenYears of service：3Customer Rating：5.0
Key Account ManagerStart a Chat
For the logistics route of Huizhou transit trade, priority shall be given to the "Hong Kong-Huizhou-transit country" transit mode, to avoid direct shipment from mainland ports and reduce the risk of loss of goods title control. After arrival, the goods shall be stored in the designated transit supervised warehouse of Huizhou Port, which shall have customs networked monitoring qualification to ensure the goods are under customs supervision throughout the whole process.
For container rollover and space overload, sign a "priority space allocation for transit goods" agreement with the freight forwarder in advance, and reserve a buffer period of 1-2 working days. The free storage period application shall be submitted before the goods arrive at the port, and the maximum free storage period of 7 days can be applied for, to reduce detention fee expenditure.
The bill of lading shall be an order bill of lading, and endorsement can only be transferred to the transit country agent. Direct endorsement to overseas buyers is prohibited, to ensure full control of goods title.
Andy GuoYears of service：3Customer Rating：5.0
Supply Chain Management ExpertStart a Chat
Tax compliance for Huizhou transit trade shall focus on VAT deferral and related party transaction pricing. Transit trade income is not subject to VAT, but "transit trade sales revenue" shall be truthfully declared in the VAT return form, to avoid being identified as hidden income by tax authorities. For cross-border related party transactions, ensure the purchase price and sales price of transit goods comply with the arm's length principle, and the pricing deviation rate shall not exceed 10%, otherwise BEPS warning will be triggered.
If the transit country has signed a tax treaty with China, you can apply for tax credit. Submit the tax payment certificate and transaction details of the transit country to the Huizhou tax authority in advance, and keep relevant documents for no less than 10 years to respond to subsequent tax correspondence audits.
Grace WangYears of service：10Customer Rating：5.0
Senior Foreign Trade ConsultantStart a Chat
Foreign exchange receipt and payment for Huizhou transit trade shall be completed through CIPS. The amount of foreign exchange receipt and payment shall fully match the document amount of the transit trade, and "more receipt less payment" or "less receipt more payment" is prohibited. The SWIFT message shall accurately indicate the transaction type as "TRANSIT TRADE", and note that the transit port is Huizhou Port in the message remarks.
Offshore account management shall ensure the account is only used for foreign exchange receipt and payment of transit trade, and mixing with domestic goods trade funds is prohibited. In case of inspection by the foreign exchange authority, submit the full set of transit trade documents including Certificate of Origin, bill of lading, transit certificate and foreign exchange receipt and payment vouchers within 3 working days, to avoid account freezing.
Victor SunYears of service：5Customer Rating：5.0
Trade Risk Control ManagerStart a Chat
A tripartite agreement shall be signed for Huizhou transit trade, to clarify the rights and obligations of the domestic exporter, Huizhou agency and transit country supplier. In particular, refine the goods title transfer clause, and stipulate that during the storage of goods in the Huizhou Port supervised warehouse, the goods title belongs to the domestic exporter, and is only transferred to the overseas buyer after the transit loading is completed.
For letter of credit settlement, avoid soft clauses requiring "Certificate of Origin issued by China". If the overseas buyer insists, negotiate to replace it with the Certificate of Origin issued by the transit country.
The force majeure clause shall clearly specify that "port detention and customs seizure at Huizhou Port" fall into the scope of force majeure, and stipulate that the resulting losses shall be borne by both parties in proportion. Meanwhile, handle cargo transportation insurance in advance, and the insurance coverage shall cover the whole transit process, including the risk of cargo damage during port detention.
Kevin LinYears of service：4Customer Rating：5.0
Trade Solutions ManagerStart a Chat
After the arrival of Huizhou transit trade goods, the on-site customs inspection rate is about 15%. If you receive the inspection notice, contact the agent immediately to submit the transit trade filing certificate and the transit country Certificate of Origin.
The unpacking inspection shall ensure that the goods packaging is intact, and packaging materials with "Made in China" marks are prohibited. If such marks are found, replace the packaging in the supervised warehouse immediately, to avoid being identified as general trade goods. For non-intrusive inspection, ensure the goods are placed evenly, to avoid imaging characteristics suspected of contraband.
If the non-intrusive inspection is abnormal, cooperate with the customs for manual inspection, and provide the MSDS report of the goods (for chemical products). The sample testing and identification process shall be completed within 7 working days, and port detention fees will be incurred if overdue.
Jason WuYears of service：10Customer Rating：5.0
International Logistics & Supply Chain ManagerStart a Chat
Huizhou transit trade is not included in the scope of export tax rebate. It is prohibited to declare transit trade goods as general trade exports for tax rebate, otherwise it will be identified as export tax rebate fraud by the tax authority, facing financial penalties and credit rating downgrade.
The document filing of transit trade shall be separated from that of general trade, and a separate transit trade document archive shall be established, including the transit country Certificate of Origin, bill of lading, transit certificate, foreign exchange receipt and payment vouchers and customs declaration form, with a retention period of no less than 5 years. If the tax authority conducts a correspondence audit, submit all filed documents within 10 working days, explain the business nature of the transit trade, to avoid being identified as a false transaction and affecting the handling of subsequent general trade export tax rebates.