The Goods Declaration into Australia is known as an Import Declaration. An Import Declaration for goods into Home Consumption is a statement made by the importer or owner of imported goods, or their licensed Customs Broker, to Australian Border Force (ABF) that provides specified information about the goods being imported into the country.
The Import Declaration comprises information on the importer, how the goods are being transported, the tariff classification, Customs Value, and any customs duty/GST liability. This procedure is separated into two categories – the Formal Import Declaration (FID) for goods with a Customs Value exceeding A$1000 and the Self-Assessed Clearance (SAC) for goods with a Customs Value less than A$1000.
Import Declarations are used to clear imported goods from customs control into the commerce of Australia (known as Home Consumption) through a ‘Nature 10’ declaration or into a licensed warehouse through a ‘Nature 20’ declaration. These declarations provide transparency to the ABF and the procedure is designed to declare and record information for all imported goods, whilst providing the basis for duty and tax calculations.
What type of goods need to be declared via an Import Declaration?
When importing goods into Australia and the goods have a value of more than A$1000, an Import Declaration (N10) must be lodged either electronically or manually and any calculated duties, taxes, and charges, must be paid.
Any goods with a Customs Value of A$1000 or less are generally exempt from duties, taxes, and import processing fees, unless the goods consist of tobacco, tobacco products or alcoholic beverages.
Goods can be valued by ABF using a number of different valuation principles; however, the transaction value is most commonly used for goods lodged through the use of a goods declaration and is often determined by the price paid (or payable) for the goods.
For the purposes of an import declaration, a consignment is defined as goods that are shipped from one consignor to one consignee which might not be packed in a single package or arrive in Australia at the same.
How does this process facilitate international trade into Australian Home Consumption?
The ABF use the import declaration to conduct checks pre-arrival profile on imported goods to ensure the protection of Australian borders. There are several steps that need to be finalised before an importer can take delivery of goods and the ABF require you to provide sufficient information to assess your goods and facilitate their release.
Once the imported goods reach their destination port, they enter Customs control. Goods will be released once ABF is satisfied the goods are reported and declared correctly, any required permits are produced, and all duty and tax liabilities are paid. Once satisfied, the ABF will issue an Authority to Deal (ATD) that provides permission to deal with goods into Australian commerce.
What documentation is required to prepare and submit an Import Declaration?
To prepare and submit an import declaration, an importer will be required to present the relevant shipping documents to either their customs broker (or to ABF in person). The type of documents needed for importing or exporting transactions will often depend on the type of goods being imported. However, a standard set of documentation will consist of a bill of lading, commercial invoice, packing list, and packing declaration (for sea cargo only).
At times, the documentation may also have to be prepared in a certain way to comply with the requirements of the export country, consist of import permits, vehicle import approvals, or other governmental authority.
Records of documentation relating to import declaration are required to be stored (physically or electronically) for a period of up to five years.
How is customs duty calculated from an Import Declaration?
The duty amount payable is determined by the classification of the goods and other factors including exemptions, concessions & existence of preference schemes & Free Trade Agreements with Australia. Customs use the rate of exchange prevailing on the day of export of the goods (not on the day the goods arrive in Australia) as the exchange rate.
Generally, all goods imported into Australia are liable for duties and taxes unless an exemption or concession applies. There are exclusions and restrictions to the use of the concessions.
Most imported goods attract a customs duty rate of 5% which is calculated on the Customs Value of the goods. When importing goods, the lodgement of an Import Declaration in ABF’s Integrated Cargo System (ICS) will calculate any duty, GST, Wine Equalisation Tax (WET) or Luxury Car Tax (LCT) liability that will need to be settled prior to the release of the goods.
How is Goods & Services Tax (GST) calculated on an Import Declaration?
The majority of imported goods declared will be subject to GST, however, there are exemptions available for a range of goods, including foods, medical aids, and various other GST-Free items.
GST on Imports is applied at the standard 10% ad valorem rate to the Value of Taxable Importation (VoTI) of the shipment. This consists of the sum of the Customs Value of the goods plus any duties or WET payable and the value of transport & insurance for the imported goods.
All businesses, organisations, and individuals are required to pay GST on Imports, irrespective if they are registered for GST with the Australian Tax Office. However, importing parties may have access to claiming an input tax credit for any GST paid on those goods, if you imported the goods for application to your own purposes after importation.
Are there other considerations when lodging an import declaration?
Whilst lodging an import declaration will assist with facilitating the clearance of cargo through electronic profiling, the ABF may still wish to examine goods that are imported into Australia to verify the goods are as described on the declaration and to ensure they are not prohibited, restricted or a biosecurity risk to Australian borders.
This could involve examining the goods through the use of X-ray facilities or physical examination by ABF officers, occasionally with detection dogs. At times, ABF may provide advice about the intention to physically examine the goods and permit the importer and/or import’s customs broker to attend the examination. ABF also has the power to open, examine, take samples, and perform tests on the goods as necessary to verify the nature of the goods or their characteristics.
What if an Import Declaration is incorrect or not submitted?
Without the lodgement of an import declaration either electronically or manually, goods will not be released from customs control and will likely experience delays and additional costs. It is recommended that importers utilise the services of a customs broker and provide them with advance notice of goods arriving, to allow pre-arrival clearance that gives the ABF a chance to evaluate the shipment of goods, prior to arrival.
It is also important that the information given to ABF is true and correct. The Customs Act 1901 contains a range of offence provisions and many are ‘strict liability’ offences, including providing a false and misleading statement. As a strict liability does not consider if the offence is intentional or negligent, only that it has occurred, it is critical complete and correct information is declared.
Import Declarations are a critical element of Australia’s border control procedure and assist the ABF to achieve its objective of facilitating trade and protecting our borders. By providing timely, accurate, and complete information that complies with Australian regulations, importers are giving themselves the greatest opportunity to experience a seamless importation of their goods.
With over 100 years of experience with Customs Clearance & Consultancy, BCR can provide a streamlined value add solution, providing factual information that allows you to make informed decisions while establishing a long term partnership that ensures compliance.