Who will receive the foreign exchange and bear the taxes and fees in agency export?
Our company intends to find an agent to export goods. Now I have a question. In the agency export business, who on earth will receive the foreign exchange? And who will bear the relevant taxes and fees? I'm worried that there may be an unclear division of responsibilities, which could damage the interests of our company. I hope someone who knows the ropes can help answer these questions, so that I can have a clear idea and know how to communicate and negotiate with the agent to protect the rights and interests of both parties.
Professional consultant answers
Joseph ZhouYears of service：10Customer Rating：5.0
Senior foreign trade managerConsult
In the agency export business, there are usually two ways of foreign exchange receipt. One is that the principal directly receives the foreign exchange. In this case, the principal directly settles the foreign exchange with foreign customers, and the agent is only responsible for assisting in handling relevant export procedures. The other is that the agent receives the foreign exchange. After receiving the foreign exchange, the agent deducts the relevant fees and then pays the remaining amount to the principal.
Regarding taxes and fees, in terms of value-added tax, if the principal is a general taxpayer and can provide a special value-added tax invoice, the agency export implements the "exemption, credit, and refund" tax policy, and the tax refund is generally given to the principal. If it is a small-scale taxpayer, the policy of exempting value-added tax is implemented. Customs duties are generally borne by the principal because the goods actually belong to the principal, and the agent only provides services. However, the specific ways of foreign exchange receipt and tax and fee bearing still need to be clearly stipulated in the agency export agreement to avoid subsequent disputes.
Sarah ZhangYears of service：8Customer Rating：5.0
Document expertConsult
Generally speaking, who receives the foreign exchange depends on the negotiation between the two parties. In most cases, if the principal wants to control the foreign exchange receipt by itself, it can do so. If it thinks the agent is reliable, it can also let the agent receive the foreign exchange. Regarding taxes and fees, such as export duties, they are generally borne by the principal, after all, the goods belong to the principal.
Andrew HuangYears of service：7Customer Rating：5.0
Supply chain optimization expertConsult
Regarding foreign exchange receipt, if the agent receives the foreign exchange, it can better integrate the capital flow and is more convenient for operation. But if the principal receives the foreign exchange, it can more directly grasp the capital situation. Taxes and fees are basically in accordance with the regulations. For example, for consumption tax, if the principal exports after consignment processing and meets the conditions, it can get a tax refund. Just write the division of responsibilities clearly in the agreement.
Amanda YangYears of service：3Customer Rating：5.0
Cost control consultantConsult
Determine the way of foreign exchange receipt in the agency contract. If the agent receives the foreign exchange, there must be supervision to protect the rights and interests of the principal. Regarding taxes and fees, for value-added tax in the export link, if the principal meets the conditions, it can enjoy the tax refund preferential policy, and the agent mainly plays an assisting role in declaration.
Emily LiuYears of service：10Customer Rating：5.0
Settlement and payment expertConsult
Either the principal or the agent can receive the foreign exchange. The key is the contract agreement. Regarding taxes and fees, since the principal is the export entity, many taxes and fees are naturally borne by the principal. The agent only charges an agency fee and does not bear the tax and fee risks.
William YangYears of service：5Customer Rating：5.0
International logistics consultantConsult
The way of foreign exchange receipt depends on the agreement between the principal and the agent. If the agent receives the foreign exchange, it should transfer the money to the principal in a timely manner. Regarding taxes and fees, for value-added tax, if the principal meets the conditions, it can get a tax refund, and customs duties are borne by the principal, after all, it is the principal's goods that are exported.
David LiYears of service：6Customer Rating：5.0
Senior customs declaration consultantConsult
For foreign exchange receipt in agency export, if the principal is strict in capital control, it can receive the foreign exchange by itself. Otherwise, it is also convenient for the process to let the agent receive it. Regarding taxes and fees, except for the agency fee, other items related to the exported goods are basically borne by the principal.
Elizabeth LiYears of service：3Customer Rating：5.0
Compliance and risk managerConsult
The way of foreign exchange receipt is subject to negotiation. After the agent receives the foreign exchange, it should transfer the money as agreed. Regarding taxes and fees, the principal bears the major part, and the agent assists in handling tax declaration and other matters. Clearly define the responsibilities in the agreement to avoid disputes.
James LiuYears of service：10Customer Rating：5.0
Foreign trade tax refund consultantConsult
The way of foreign exchange receipt depends on the situation, and both parties should negotiate well. Regarding taxes and fees, value-added tax, customs duties, etc. are basically borne by the principal, and the agent is not responsible for paying these taxes and fees.
Robert ChenYears of service：6Customer Rating：5.0
Customer service consultantConsult
For foreign exchange receipt in agency export, if the principal receives the foreign exchange by itself, it can keep track of the capital dynamics at any time. Regarding taxes and fees, most of them are borne by the principal according to regulations, and the agent helps with handling the procedures.