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Is it okay not to do tax refund for export by agency? Come and find out!

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Our company conducts export business through an agency. Now I'd like to know if it's okay not to do tax refund for export by agency? What impact will it have on the company if tax refund is not done? Is it decided by the agent or by ourselves whether to do tax refund or not? I hope a professional can help answer this question, so that I can clearly understand the pros and cons and key points of operation.

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Professional consultant answers

Emily Liu
Emily LiuYears of service:10Customer Rating:5.0

Settlement and payment expertConsult

Tax refund can be waived for export by agency. However, the following aspects need to be noted. Firstly, if tax refund is not done, the value-added tax borne in the domestic procurement process of exported goods cannot be refunded, which means the company's costs will increase. For example, if the purchased goods contain 13% value-added tax, not doing tax refund is equivalent to the company bearing all of this part of the tax.

Secondly, from the perspective of the operation process, not doing tax refund is relatively simple. There is no need to carry out the complicated tax refund declaration process, saving labor and time costs. However, in some cases, not doing tax refund may affect the credit rating of the enterprise in departments such as customs and taxation.

As for whether it is decided by the agent or the consignor, it usually depends on the negotiation between the two parties. However, from the perspective of tax regulations, the consignor is the subject of tax refund. Usually, it is up to the consignor to decide whether to apply for tax refund. But the agent has the obligation to assist in providing relevant materials, etc.

Michelle Chen
Michelle ChenYears of service:3Customer Rating:5.0

Business coordination consultantConsult

If tax refund is not done, it may affect the pricing of goods. Because the inability to get tax refund increases costs, the product price may need to be raised, thus possibly affecting competitiveness.

James Liu
James LiuYears of service:10Customer Rating:5.0

Foreign trade tax refund consultantConsult

If you choose not to do tax refund, you must report to the tax department in a timely manner and handle it as tax exemption or deemed domestic sales taxation according to regulations. Otherwise, you may face tax risks.

Joseph Zhou
Joseph ZhouYears of service:10Customer Rating:5.0

Senior foreign trade managerConsult

Not doing tax refund will be simpler in financial accounting. There is no need to specifically account for tax refund-related accounts, reducing the complexity of financial work.

William Yang
William YangYears of service:5Customer Rating:5.0

International logistics consultantConsult

If export by agency is not accompanied by tax refund for a long time, it may attract the attention of the tax department and increase the probability of tax inspection.

Jennifer Wang
Jennifer WangYears of service:4Customer Rating:5.0

Market development consultantConsult

Not doing tax refund for export by agency may be an option for some small-scale taxpayers, as they themselves are unable to enjoy tax refund benefits.

Elizabeth Li
Elizabeth LiYears of service:3Customer Rating:5.0

Compliance and risk managerConsult

Not doing tax refund may affect the cooperative relationship with suppliers. Suppliers may consider the impact on their own tax situation in the sales process.

Amanda Yang
Amanda YangYears of service:3Customer Rating:5.0

Cost control consultantConsult

When the tax refund rate of exported goods is low, not doing tax refund may have little impact on the overall cost, and comprehensive consideration can be made.

Andrew Huang
Andrew HuangYears of service:7Customer Rating:5.0

Supply chain optimization expertConsult

When choosing not to do tax refund, you need to weigh the impact on the enterprise's cash flow. Tax refund can increase cash flow, while not doing tax refund means there will be no such inflow of funds.

The relevant questions or replies only represent the user’s personal stance and do not represent any views of this website.

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