Our company plans to use an agency for export business but is unclear about tax payment. We'd like to ask: in export agency, should the principal or the agent pay taxes? What tax types are involved? And what is the tax payment process? We hope professionals can help clarify this, giving us a clearer understanding of tax payment in export agency to avoid future tax issues.
The company plans to carry out import business and asks how to pay taxes on behalf of the import business, whether the process is complicated and what materials need to be prepared. The best answer says that the process is relatively complicated. First, it is necessary to clarify the classification of goods and tax rates, prepare documents such as commercial invoices, entrust a qualified agency company to declare to the customs. After the customs review, a tax payment statement will be issued, and the tax shall be paid within the specified time. Pay attention to the accuracy of documents and timely declaration during operation.
Planning to hire an agency to import goods, inquiring whether taxes are required for agency imports, which taxes are involved, the tax payment process, and who is responsible for payment. The best answer states that taxes are required for agency imports, generally involving tariffs and VAT, with some goods subject to consumption tax. Taxes are usually paid by the agency during customs declaration, and the fees are often borne by the client. The tax payment process should be handled carefully.
The company plans to carry out the agency export business and asks whether this business needs to pay taxes. If so, which tax categories are involved and what is the tax payment process. The best answer states that the tax payment for the agency export business varies depending on the situation. The agent shall pay value-added tax on the agency fees received according to "Modern Services - Business Auxiliary Services - Brokerage and Agency Services". The tax rate for general taxpayers is 6%, and the collection rate for small-scale taxpayers is 3% (currently with a temporary preferential rate of 1%). The agency fee income also needs to be included in the taxable income to pay corporate income tax, and tax payment must be declared as required.
The company intends to engage in the agency import business and wants to understand the tax payment situation, such as the tax types involved, tax rates, and procedures. The best answer states that agency import mainly involves import duties, value-added tax, and some products may also have consumption tax. The duty rate depends on the commodity classification, and the common value-added tax rates are 13% or 9%. When paying taxes, either the agent or the principal shall declare to the customs first. After the customs issues the tax payment notice, pay the tax on time, and also keep relevant materials.
The company hires an agent to import goods and incurs import agency service fees. It asks about the tax regulations, including under which tax category to pay, what the tax rate is, whether there are differences due to the type of goods, and the tax declaration process. The best answer states that this fee is usually subject to value-added tax under "Modern services - Business assistance services - Brokerage and agency services". The tax rate for general taxpayers is 6%, and for small-scale taxpayers, it is reduced to 1% before December 31, 2023. The declaration can be made through the Electronic Tax Bureau, and it is not greatly affected by the type of goods. Specific details can be consulted with the local tax authorities.
Planning to engage in import business and want to understand the specific items covered by import agency customs declaration, such as cargo declaration, inspection, tax payment, etc. The best answer indicates that import agency customs declaration includes document processing, declaration, inspection coordination, tax payment, transportation arrangement coordination, and customs clearance document archiving. Choosing a professional company can make the import process smoother.
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Professional consultant answers
Elizabeth LiYears of service：3Customer Rating：5.0
Compliance and risk managerConsult
In export agency business, generally the principal pays taxes. This is because the principal is the actual owner of the goods and the true entity conducting the export operations.
The main tax types involved are VAT and consumption tax. For VAT, if the exported goods fall under VAT exemption, the principal can apply for export tax exemption; if they qualify for tax refund, the principal can claim export VAT refund. For consumption tax, the principal may also claim refunds for eligible exported goods subject to consumption tax.
The tax payment process generally requires the principal to prepare relevant documents such as export customs declaration and agency agreement, then declare to the tax authority within the prescribed period. The agent mainly assists in collecting and organizing relevant documents but doesn't bear primary tax payment responsibility.
David LiYears of service：6Customer Rating：5.0
Senior customs declaration consultantConsult
Usually the principal pays taxes because the goods belong to the principal. The agent only provides services without ownership of goods, thus having no tax payment obligation.
Joseph ZhouYears of service：10Customer Rating：5.0
Senior foreign trade managerConsult
Indeed, principals mostly pay taxes. Even small-scale taxpayers using export agencies need to declare tax exemption or payment as required.
Amanda YangYears of service：3Customer Rating：5.0
Cost control consultantConsult
Correct, the principal pays taxes. For export tax refund, the principal prepares documents and follows procedures while the agent provides assistance.
William YangYears of service：5Customer Rating：5.0
International logistics consultantConsult
Basically the principal bears tax payment responsibility, while the agent only handles agency operations without tax payment duties.
Jennifer WangYears of service：4Customer Rating：5.0
Market development consultantConsult
Definitely the principal pays taxes, since the principal benefits from export business and naturally bears tax responsibilities.
Sarah ZhangYears of service：8Customer Rating：5.0
Document expertConsult
The principal pays taxes, but the agent should assist by providing necessary export documents for the principal's tax declaration.
Andrew HuangYears of service：7Customer Rating：5.0
Supply chain optimization expertConsult
From business substance perspective, it's reasonable for the principal to pay taxes since goods ownership lies with them.
James LiuYears of service：10Customer Rating：5.0
Foreign trade tax refund consultantConsult
The principal pays taxes and must declare accurately and timely, otherwise it may affect export business and credit standing.
Emily LiuYears of service：10Customer Rating：5.0
Settlement and payment expertConsult
The principal pays taxes - this is a common rule in export agency business, just follow prescribed procedures.