Tradex Scheme

25th February, 2020

We really love talking about savings within the International supply chain. This one has been dusted off from the archives, but is as relevant today as it was when introduced as the Tradex Scheme Act 1999.

It plays to the heart of what all businesses need to be working on and that is your cash flow.

If you are importing goods to Australia that are subsequently going to be exported within 12 months of the import you can make application to join the Tradex Scheme. If approved to join the scheme all nominated goods can be imported without the payment of any duty or GST.

Some rules for you:

• The Tradex order must be approved prior to the goods being imported
• The Tradex order can be used on any goods nominated on your Tradex order
• Nominated imported goods must be exported within 12 months
• The goods can be exported in the same condition as imported, after further treatment of the goods or after they have been incorporated into other goods
• Your nominated goods must not be intended for sale nor to be consumed or used in Australia
• Thorough record and account keeping records must be kept
• Processes for the tracking of the goods must also be in place.

The good news is there is some flexibility in the application process. Many importers are not fully aware of the quantity of goods that will ultimately be re exported so have not been applying for the Tradex order. An application can be made to have an agreed percentage of the goods subject to the Tradex order. Historical data might suggest that 40% of what you import is ultimately re exported so this is the amount that would be claimed at the time of import, with your agreed thorough record keeping practices in place an adjustment can be made to the duty liability should the percentage change for any given reason, this is very easy to implement. Our operating system can maintain most of the reporting requirements of the program.

WHO MIGHT USE THIS SCHEME?

• Companies holding stock for distribution to nearby countries such as New Zealand, Papua New Guinea or some of the very close Island nations to Australia
• Companies that do undertake further manufacturing of imported goods within Australia and subsequently export the re worked goods
• With the global increases in e-commerce many foreign companies are now distributing from Australia, this is ideal to hold stock in a 3PL warehouse in AU and sell to off shore as required, you would need to fall into the agreed percentage under this scenario

WHY?

There are many companies paying out duty and GST and then trying to have appropriate practices in place to make claim for duty refunds when the goods are exported. It is worth your time to consider if this program is suitable for your business. At SCC we can give you the necessary advice on the relevance to your business and also assist with the application.

Please get in touch with sales@sccargo.com.au should you require any further details.