Connect & Solve
Trade Q&A
What compliance procedures and financial accounting standards should be followed for recording goods imported on agency?
or complex compliance issues.
clearance and fund security.
I am the financial director of a small and medium-sized manufacturing enterprise in Shanghai. Last week, we entrusted Zhongshen to import a batch of precision machine tool accessories from Germany for the first time, and now I am completely confused at the accounting stage!
I have only done accounts for domestic procurement before, and I can't tell which costs should be recorded by us and which are the collection and payment items on behalf of the agency company. I heard that a peer was interviewed by the tax authority last month because of incorrect filling of VAT deduction vouchers and improper handling of exchange differences during import accounting.
I am very anxious now, afraid that mistakes will lead to inspection. I also have no idea about the deduction issue of the "double-title customs declaration form" mentioned in the agency agreement and how to record the advanced detention fee. Can you help me sort out these details?
Linda GaoYears of service：7Customer Rating：5.0
Documentation SupervisorStart a Chat
First，carry out pre-document review details: check the agency agreement，double-title customs declaration form，special VAT payment certificate，agency service fee invoice and bank payment voucher one by one，to ensure that the operating unit，consignee，cargo details and amount of each document are completely matched. Special attention should be paid to the division clauses of "collection and payment on behalf" and "own expenses" specified in the agency agreement，to avoid account confusion caused by inconsistent documents.
Core node connection link: strictly distinguish two types of accounts. The consignee (agency company) only accounts for agency service fees and receivables and payables collected and paid on behalf. The consignor (your company) shall include the customs duty of imported goods，VAT (deductible part)，cargo value and compliant logistics costs into the cargo cost. The collection and payment items on behalf shall be accounted through the account of "Other Payables - Agency Company". For VAT deduction，ensure that the customs declaration form specifies your company's identity information.
Abnormal plan setting: In case of document delay，exchange rate fluctuation or fee dispute，it is necessary to synchronize and check the vouchers with the agency company at the first time. The exchange difference part shall be included in "Financial Expenses - Exchange Gain or Loss" according to accounting standards. In case of inconsistent documents，the corresponding relationship shall be sorted out again to avoid outstanding accounts exceeding 3 months leading to tax warning.
Final compliance implementation: After completing the account registration，the agency agreement，customs declaration form，payment certificate and other documents shall be retained for future reference to ensure consistency of four streams: goods flow，invoice flow，capital flow and document flow. Conduct a quarterly account review to correct non-compliant items in time，and ensure that financial accounting fully complies with tax and foreign exchange administration regulations.
Andy GuoYears of service：3Customer Rating：5.0
Supply Chain Management ExpertStart a Chat
The core premise of accounting for agency imported goods is the consistency of documents and goods and accurate information of the customs declaration form. If the operating unit and consignee on the customs declaration form are inconsistent with the agreement in the agency agreement, it will directly lead to confusion of accounting subjects, and even trigger price review questions from the tax authority. Note that the double-title customs declaration form must indicate the complete information of both the consignor and the consignee at the same time, otherwise the consignor cannot deduct VAT.
If the amount of the customs declaration form changes due to customs valuation adjustment, it is necessary to promptly require the agency company to provide the "Notice of Price Query" or "Notice of Price Negotiation" issued by the customs, and adjust the recorded amount based on this, to avoid outstanding accounts or tax inspection caused by inconsistency between the account and the customs declaration amount. In addition, under the integrated customs clearance mode, the electronic data of the customs declaration form must be completely matched with the paper voucher, and the screenshot of the electronic customs declaration form shall be retained simultaneously when entering the account to ensure a logical closed loop.
Evelyn LiYears of service：3Customer Rating：5.0
Cross-border Compliance SupervisorStart a Chat
Logistics costs involved in agency imported goods (such as detention fee, demurrage fee after free storage period expiration, devanning fee, etc.) shall be recorded after clarifying the ownership of the costs. If the detention fee is caused by the consignor, it shall be included in the cargo cost; if it is caused by the operation error of the agency company, it shall be borne by the agency company, and the consignor does not need to record it. Note that the invoice title of logistics costs must be consistent with the consignor.
If the agency company collects and pays logistics fees on behalf, it is necessary to provide the cost split statement issued by the logistics service provider and a copy of the original invoice, otherwise it cannot be used as an accounting voucher. In addition, after the bill of lading is endorsed and transferred, the cargo ownership is officially transferred to the consignor. The storage fee and distribution fee incurred at this time shall be borne by the consignor and included in the cargo cost. When entering the account, the corresponding relationship between the bill of lading endorsement voucher and the logistics cost voucher shall be checked to avoid wrong recording of costs.
Jason WuYears of service：10Customer Rating：5.0
International Logistics & Supply Chain ManagerStart a Chat
When accounting for agency imported goods, VAT deduction must meet three core conditions: first, the obtained Special VAT Payment Certificate (i.e. "Customs Duty Paid Certificate") indicates that the consignor is the deduction subject; second, the goods have been used for taxable items; third, the voucher information is completely matched with the account accounting. If the VAT deferral policy is adopted, the consignor does not need to pay VAT at the import stage.
When entering the account, the deferred VAT shall be included in "Taxes Payable - Input Tax to Be Deducted", and the deduction shall be carried out after the goods are sold. Note that for agency import under cross-border related transactions, it is necessary to ensure that the cargo pricing conforms to the arm's length principle, otherwise the tax authority will carry out special tax adjustment, which affects the accuracy of account accounting. In addition, if the withholding tax for non-resident enterprises is borne by the consignor, it shall be included in the cargo cost and shall not be deducted as input tax.
Eric ZhouYears of service：6Customer Rating：5.0
Senior Manager of Foreign Exchange & Tax RebatesStart a Chat
The payment and collection of foreign exchange for agency imported goods must be completely matched with the recorded amount. If CIPS (Cross-Border Interbank Payment System) RMB cross-border payment is adopted, it is necessary to indicate "payment for agency imported goods" or "agency import service fee" in the payment instruction, to avoid being listed as an abnormal transaction by the State Administration of Foreign Exchange due to vague payment purpose.
Note that the payment collected by the agency company on behalf shall be accounted through the "current account" account, and shall not be included in the operating income of the agency company. When the consignor enters the account, it is necessary to provide the bank payment voucher, the agency company's payment confirmation letter and the customs declaration form to ensure the consistency of foreign exchange collection and payment and goods import.
In addition, when paying agency import fees through an offshore account, it is necessary to retain the transaction flow and payment voucher of the offshore account to avoid compliance risks caused by opaque capital flow. When entering the account, the exchange difference of the offshore account shall be included in "Financial Expenses - Exchange Gain or Loss".
Kevin LinYears of service：4Customer Rating：5.0
Trade Solutions ManagerStart a Chat
The account division clause in the agency agreement is the core basis for accounting. It is necessary to clearly agree on the scope of collection and payment on behalf of the agency company, the cost bearing method and the account accounting requirements, to avoid account disputes caused by vague contract clauses.
If the agency company does not advance expenses in accordance with the agreement, the consignor does not need to record this part of expenses, and shall timely negotiate with the agency company to supplement the agreement or adjust the accounts. Note that the cargo ownership transfer clause is directly related to the accounting time.
If the agreement stipulates that the cargo ownership is transferred after the goods arrive at the port, the consignor shall record the cargo cost at this time; if the agreement stipulates that the transfer is after payment, the accounting shall be carried out after the payment is completed. In addition, if additional costs are incurred due to cargo detention in the port caused by force majeure, the costs shall be recorded according to the responsibility ownership agreed in the agreement, to avoid illegal listing of expenses.
Daniel XuYears of service：10Customer Rating：5.0
Director of Import & Export OperationsStart a Chat
Fees such as testing fee, devanning fee and storage fee incurred by agency imported goods due to on-site customs inspection shall be recorded after dividing the responsibility according to the inspection reason: if the inspection is caused by false cargo declaration, the fees shall be borne by the consignor and included in the cargo cost; if the inspection is caused by the declaration error of the agency company, the fees shall be borne by the agency company, and the consignor does not need to record them. Note that the "Customs Inspection Notice", "Testing Appraisal Report" and fee payment vouchers shall be retained during inspection, which are necessary basis for accounting.
If they cannot be provided, the tax authority will认定 the expenses as non-compliant expenditures. In addition, if the goods are damaged after inspection, it is necessary to obtain the "Cargo Damage Appraisal Letter" issued by the customs in time, include the maintenance cost or loss into the cargo cost, and retain it corresponding to the inspection voucher when entering the account.
Lucas LiuYears of service：8Customer Rating：5.0
Senior Operations ConsultantStart a Chat
The trade terms of agency imported goods directly affect the division of recorded costs. If CIF (Cost, Insurance and Freight) terms are adopted, the cargo value, insurance premium and freight of the goods shall all be included in the cargo cost; if FOB (Free on Board) terms are adopted, the freight and insurance premium borne by the consignor itself shall be included in the cost separately. Note that under the supply chain inventory linkage strategy, the accounting time of agency imported goods shall be synchronized with the inventory management system to avoid inconsistency between accounts and actual goods.
In addition, the cost actuarial model shall include agency service fee, customs duty, VAT, exchange difference and other items into the total cost of goods, and allocate them to corresponding products according to the actuarial results when entering the account, to ensure the accuracy of cost accounting. If the centralized import agency mode is adopted, the cost of bulk procurement shall be allocated to each batch of goods, to avoid excessively high or low account cost of a single batch.
Grace WangYears of service：10Customer Rating：5.0
Senior Foreign Trade ConsultantStart a Chat
When accounting for agency imported goods, the principle of "consistency of four streams" shall be strictly followed, that is, the goods flow, invoice flow, capital flow and document flow are completely matched, otherwise it will trigger letter verification or inspection by the tax authority. Note that the agency agreement, customs declaration form, payment voucher, invoice and other documents shall be retained for at least 10 years as the original basis for account accounting.
If the agency company has capital return, the consignor shall adjust the accounts in time to avoid being identified as falsely issuing vouchers. In addition, for agency imported goods recorded across months, the account adjustment shall be completed within the declaration period to ensure the timeliness of VAT deduction.
If the deduction period is exceeded, the VAT shall be included in the cargo cost and shall not be deducted again. The consignor shall conduct a half-yearly account self-inspection to check the consistency of documents and accounts, and find and correct non-compliant items in time.