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Frequently Asked Questions

Key Considerations for Your Business

It is important to consider some of the aspects that will affect your business. Find out more about the following topics that may be relevant to you:

Customs Duty is a tax the government charges on imported goods. South Africa is part of the Southern African Customs Union (SACU). SACU includes South Africa, Botswana, Lesotho, Namibia, and Eswatini. All these countries have the same Customs Duty rates. The specific rate depends on how your product is classified.

There are three types of Customs Duty:

  • Duty based on value (Ad Valorem): This is the most common, especially for luxury items. The duty is calculated as a percentage of the product’s value.
  • Duty based on quantity (Specific): This applies to products like alcohol and tobacco, based on their weight or volume.
  • Rated or Formal Duties: These are primarily used for clothing and textiles.

Tariff Classification is the process of categorising your product according to a detailed list called the tariff. This list includes:

  • Tariff chapters
  • Tariff headings
  • Tariff subheadings
  • Rules for rebates, refunds, and drawbacks
  • The applicable duty rates

This classification is complex and follows international rules. However, expert knowledge can help you find opportunities to reduce your duty costs compared to your competitors. It also affects other duties and eligibility for rebates, refunds, and drawbacks.

The World Customs Organization (WCO) created the tariff and its rules. South Africa and SACU adopted them on January 1, 1988.

Customs Duty Liability is the specific duty rate that applies to your product. It depends on three factors:

  1. Tariff Classification: How your product is categorised.
  2. Customs Valuation: The value of your product for duty purposes.
  3. Origin of products: Where your product comes from.

No matter how complex Customs, excise, and international trade seem, they always come down to these three key elements.

Yes. Customs routinely detains shipments to verify the accuracy of declarations. If they believe your declaration is incorrect, they may instruct you to amend it and pay the additional duty. A penalty may also apply.

You will be given an opportunity to dispute Customs’ findings. Typically, Customs will issue a Letter of Intent, which you can contest. If the matter is not resolved, a Letter of Demand will follow, requiring payment within a specified timeframe.

To avoid this, it’s crucial to respond to the Letter of Intent with a well-researched and fact-based argument. Your appeal should be supported by past determinations and Customs guidebooks.

Yes. Customs can request payment of duty and penalties on past shipments for up to two years from the date of their query. In cases involving fraud or misrepresentation, they may review records going back even further.

Yes. You can apply for a Tariff Determination, which is a legally binding decision issued by the Commissioner. It provides the correct tariff classification for your goods and determines the applicable duty rate.

Obtaining a Tariff Determination ensures consistent classification across the industry and helps you remain competitive by paying the correct duty – no more, no less.

Yes. Although Customs aims to collect only the correct amount of duty, overpayments do occur. Common reasons include:

  • Incorrect tariff classification
  • Incorrect customs value used
  • Paying duty on goods that qualify for a rebate
  • Not applying a preferential duty rate under a trade agreement

If you discover an overpayment, you can apply to Customs for a refund.

Let Us Handle Your Customs Challenges

Whether you prefer to send an email or to chat over a coffee we’re here to help with all your Customs needs.

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