Customs Clearance Information for Cargo in Australia

There are a number of important rules and regulations concerning the customs clearance of goods being imported into Australia. For example, depending on the goods value, and how they are transported to Australia determines how they are need to be cleared and what duty, taxes and charges might apply.

Some goods, such as alcohol and tobacco, will incur import duty and GST regardless of their value, while certain other goods are not even allowed to be brought into Australia or may require a special permit. For this reason, first-time or infrequent importers are strongly encouraged by Customs to use the services of a customs broker to clear their goods through customs. Depth Logistics can arrange customs clearance for you.

Goods with a value of AUD 1000 or less
You do not have to pay duty and taxes on goods with a customs value of AUD 1000 or less. These are called low value imports and typically can be cleared on an informal self-assessed clearance.

Goods with a value of more than AUD 1000
To import goods with a value over AUD 1000, you need to make a Formal Import Declaration. The Import Declaration provides information about the goods you are importing to Customs. There is an Electronic Entry Charge that Customs charge for processing this and all imported goods are subject to import duty and GST assessment. Our customs brokers are online to customs cargo clearance system so we can affect customs clearance fast for you. Click here to learn about customs clearance processing times for cargo.

Personal Effects and Household Goods

Customs and Quarantine require a different clearance process for this type of cargo and need special declarations as to the contents. Frequently inspections are required to facilitate the clearance. There is no import duty or GST on personal effects however some items, such as motor vehicles, will still attract these charges and require a formal entry. Learn more...

We charge a fee to handle the customs clearance formalities on your behalf and to handle other aspects such as Quarantine clearance should the goods or packing require this as they are of plant or animal origin. We can also arrange delivery to your door. My company, Depth Logistics, negotiates special clearance fees for high volume importers.

If you want to clear the goods yourself then you can however be aware that Customs in Australia will provide very limited assistance to first-time importers, and no assistance to regular importers. A manual clearance you prepared and lodged yourself can take up to 9 days for Customs to process and they charge a processing fee of about $90.00. For commercial importers sensibly using a customs broker is the best and fastest way to clear your cargo.

Contact my team at Depth Logistics to find out more information or to begin your customs clearance in Australia today. You can upload your documents on our website to allow us to commence processing immediately. We are available 24/7 on our toll free number 1DEPTH (133784) if you need any further information or assistance.

All for now,

+Brad Skelton 

How long does Customs Clearance of Cargo in Australia take?

Depth Logistics' customs broker is online to Australian Border Force(Customs) Integrated Cargo System. This enables electronic lodgment of customs declarations. About 98% or more of the entries our customs agents lodge are processed and released within a few hours. If Customs have queries or decided to do a detailed check of the documents and cargo this can sometimes take up to a few days more depending on the nature of their enquiry.We prioritise the lodgment of customs declarations on shipments that have already arrived over shipments that are still enroute so that storage charges can hopefully be avoided. We lodge entries with Customs usually less than 24 hours after receipt of a full set of shipping documents.

It is important to get us your shipping documents to us without delay. If we have a full set of documents prior to the cargo arriving, Depth Logistics can arrange a pre-clearance. This means your goods are able to be delivered with no delay after they physically land. If the goods are subject to Quarantine clearance this can take another one or two days to process depending on what action is taken by this authority.

Before Customs release your cargo they require us to pay any import duty, GST and Electronic Entry Charges. They direct debit this from the our customs brokers bank account. To avoid delays it is important you make payment to us ahead of time so we have cleared funds on hand in order to meet the daily direct debit.

There are different procedures for personal effects and household goods and these do generally take longer to be processed as the Quarantine and Customs risk profiles are higher on this type of cargo.

If we have been able to do a full pre-clearance of Customs and Quarantine and have been paid all charges prior to the arrival of the ship or flight, then we are usually delivering our clients cargo the next day for sea freight and the same day or next morning for airfreight. Having cargo "stuck in Customs" is virtually a thing of the past if you and your customs broker are well prepared.

If you would like more information about customs clearance processing times in Australia please contact us or call us toll free on 1DEPTH (133784).

All for now,

+Brad Skelton

How Is Import Duty and GST Calculated in Australia?

All imported goods are potentially subject to import duty and GST before they can be released for delivery by the wharf, airport bond store or Australia Post in the case of international parcels arriving by mail.

My team and I at Depth Logistics are commonly asked how import duty and GST is calculated so by way of this post I will explain the basic principles.

Import Duty is determined by the classification of goods in the Customs Tariff and the applicability of concessions. The duty rate can range from FREE to 10%, however the standard rate for most goods is 5%.

Our licensed customs brokers classify your goods in the Customs Tariff and proactively search for concessions, by-laws and Free Trade Agreement exemptions that may make the goods duty free. Our Tariff Consultants can also make application to Customs for Tariff Concessions on your goods. Learn more about Tariff Consultancy Services.

Australia has numerous Free Trade Agreements with many of its major trading partners and is currently entering into more. With the right declarations and/or Certificates of Origin it means we can legally claim exemption from import duty on your goods.

Import Duty is calculated as a percentage of the goods value or Customs Value (CV) of your consignment.

GST is calculated at 10% of the Value of the Taxable Import (VoTI). The VoTI is calculated by the addition of the Customs Value (CV) plus the Duty plus the value of the International Transport and Insurance (T&I).

Here is an example of how the import duty and GST is calculated on goods valued at AUD$1000 which attract a 5% duty rate:

Duty @ 5% of the AUD$1,000 (CV) = $ 50.00(Duty)

International transport and insurance (T&I) = $ 150.00

Then the VoTI = (CV) + Duty + (T&I) = $1,200.00

GST is 10% of the VoTI = 10% x $1200 = $ 120.00(GST)

Total Duty and GST Payable $ 170.00

Depth Logistics Customs Brokers are online to Customs Cargo System so this means lower Customs declaration processing fees for you compared to lodging import declarations manually yourself. The charges Customs levy for this are called Electronic Entry Charges(EEC). These charges range from $50.00 to about $194.00 depending on the value of the goods and mode of transport. Also as our customs brokers are online to Customs it means that in the majority of case cargo clearance processing is near instantaneous except where Customs may have a query or other concern.

Import duty and GST is paid to Customs by a daily direct debit facility on the customs brokers bank account. This is why customs brokers and freight forwarders usually require payment for these charges prior to delivery of your cargo.

If you are a frequent importer that lodges your Business Activity Statement monthly with the Australian Tax Office, we can also arrange to defer your payment of the GST to assist your cashflow.

If you would like more information about the applicable duty rates on goods you are importing, or any other aspect of customs clearance in Australia, please contact us or call toll free on 1DEPTH (133784).

All for now,

+Brad Skelton 

Freight forwarders quotation trick #69

My team and I at Depth Logistics always give our clients comprehensive and fully transparent quotes that they can reliably budget on. This is a non-negotiable thing for us.

That being said, increasingly we are competing against operators who are at best convenient in how they present their quotations, or at worst, plainly try to mislead shippers about the true landed costs just to secure the booking.

One trick we see nearly every day relates to Australian Customs and Quarantine import charges charges which are published on government websites. Specifically EEC(Electronic Entry Charges) and DAWR(Dept of Agriculture and Water Resources) entry and inspection fees.

Unscrupulous freight forwarders will not quote these actual charges in dollar terms to a client as if they did it increases their quotation per shipment by sometimes A$2-300.00+ depending on the cargo type and import declarations required. Instead they say things like "Plus government charges" or "Plus EEC and DAWR fees" if the client is lucky.

Price is an important driver of most clients decisions as to who they trust to move their cargo. When they are making their decision they innocently compare quotes where a professional forwarder actual identifies the exact costs, because you can, against another operator who intentionally is vague(Plus Govt charges). They total the various dollar amounts listed in the quotes and compare who is the most competitive.

It is not until they get billed and find that these charges were not identified specifically in the original quotation that they realise they have actually paid too much overall.

To make matters worse operators who do this usually add EEC onto the import duty and GST on their invoice to disguise the charges further which they know will often go unnoticed by the client. If they get found out and queried later they hide behind "But our quote said Plus Govt charges" and the poor client is snookered.

So be aware of this freight forwarders quotation trick and insist that whoever you get quotations from always identifies all charges in dollar terms so you can compare apples with apples.

If you need any further clarification or want to check what you might have been billed previously, I'd be pleased to help.

+Brad Skelton 

Australian federal budget 2014. Some suggestions from a humble shipping bloke.

On the 13 of May the new Australian Government hands down the Australian Federal Budget 2014. The speculation as to what will be in it seems bigger than ever in the media. While in no way do I consider myself an economist, at very best perhaps a bush economist, I'd like to enter the fray with a couple of suggestions for the Treasurer, Joe Hockey.

I think most Australians accept our country is now back in debt and it needs to be addressed. Generally I think we are prepared to take some pain rather than go the way of other countries whose debt grew to such an overwhelming level that their economies became dysfunctional. The Australian government must raise tax revenue, cut costs and help our exporters. Pure and simple.

With my background and qualifications in international trade and customs I think one area that government should use is with import duties. An increase in import duty of just 1 or 2%, on imported goods from countries that Australia does not have a free trade agreement with, would generate huge revenue and also help protect our local jobs and manufacturers who are rapidly disappearing with increasing global competition. Furthermore it would make imported goods slightly more expensive and hopefully slow imports down and thus improve our balance of payments. Such an increase to import duty is easy to apply and cheap to administer as Customs have the IT infrastructure to do this already.

Back in my college days, about 25 years ago, I wrote my final paper suggesting that protectionist policy had had it's day and we would see free trade between nations and trading blocks emerge. I was severely marked down on this at the time as my lecturer had a strong protectionist and differing view. Essentially what I predicted is what has come to pass though. 

I have not been a protectionist for all of my working life however I now think in the next 5-10 years we may go full circle and we will start implementing protectionist policy once again. I believe many other countries in the west will be forced to as they cannot compete with other other countries and keep their population employed. So as global competition is intensifying I am gradually becoming a protectionist conditional upon import duties imposed being kept to a bare minimum. In my mind an absolute maximum of 5% as we do not want our local industry to become complacent or reliant on import duty for survival.

The other area is GST. While I do not profess to know the finer points of Canadian taxation, it seems to me that the Canucks are doing it pretty well and adjust the rate of GST up or down accordingly to act as another economic lever. During the GFC they lowered their GST progressively from 9% to 5% where it is now which in effect helped stimulate the economy by making things cheaper.

In Australia the main and seemingly only lever we use is interest rates to slow down or to stimulate economy. Pretty crude approach in comparison to our Canadian mates who have very similar economy to ours with mining, tourism and agriculture being key drivers and two levers to pull economically. We should follow their lead.

Apart from that, help is on the way to our exporters. This month the government increased expenditure on Export Market Development Grants and simplified the process. A positive initiative that will certainly assist.

If only the AUD would weaken to sensible levels for our exporters then we'd be knocking down that foreign debt in no time.

I'm happy to take your call Mr Hockey if you'd like a few more suggestions...

All for now,

+Brad Skelton 

4PL "us too"...and a FREE supply chain health check.

Perhaps imitation really is the sincerest form flattery. 

My team and I launched a 4PL (Fourth party Logistics) service specifically for heavy industry and major projects earlier this year. By leveraging the enormous direct knowledge and experience we have gained in owning and operating in all manner of transport operations from cranes, trucks, freight forwarding companies, customs brokerages, warehouses, storage yards and quarantine facilities we have been able to save clients millions of dollars in some instances.

Since launching this new service we have noticed competitors, large and small, saying "us too" and now advertising they are 4PL providers when indeed most of them are not or perhaps even properly understand the concept or role they need to play.

The essence of being a 4PL provider is that you are 100% neutral. To be truly neutral you must be non-asset based. This means that you do not operate your own warehouses, trucks, planes, cranes or ships. If you do then immediately you have a conflict as you will naturally favor cargo traffic for your own assets ahead delivering the best solution for the client no matter who the provider is. This is one of the keys.

The other key is a good 4PL provider must have it's own in house IT capability and systems to support it's clients logistics and supply chain management.  Off the shelf software packages that most 3PL forwarders run do not have the modules or analytical sophistication to support a 4PL supply chain strategy.

I back my team and I to find efficiency gains and cost reductions in your supply chain whether that be domestically and/or internationally. Therefore between now and the 30th of November this year I am offering a FREE 4PL supply chain health check. There are no fees for our time if we cannot find gains for you.

If you'd like to take advantage of this offer, please email or call me. Ph: +61414362707

All for now,

+Brad Skelton