Primary Valuation Method - Transaction Method Flashcards
TV - What price is classed as the transaction value?
Price actually paid for the goods when sold for import.
Price must be adjusted to include other costs incurred by the buyer
Can a lower value than current market value be accepted as the transaction value?
Yes - provided the price is the agreed upon price between the buyer and seller.
Define price actually paid/payable
As well as the cost of goods, all additional cost pertaining to the import the buyer is responsible for covering whether already paid or payable after import.
What following persons of which payments can be made are included in “Price actually paid or payable”
The seller - I.E cost of goods
Third party related to the seller - Export agent, shipping agent
Third party made to satisfy and obligation to the seller
Can goods price discounts be applied to price actually paid?
Yes, if there is a 35% discount for orders placed when the goods where order but the goods ship after the discount period, this ill still applied to goods value and transaction value for customs purposed.
IS the invoice value the price actually paid?
No, it is only the cost of goods and in some cases certain services.
IS the invoice value the price actually paid?
No, it is only the cost of goods and in some cases certain services. All payments by the buyer to the seller or a third party as a condition of the sale are incorporated in to the total payment made.
Activities undertaken on the buyers own account??
Activities not incorporated in amount actually paid such as. Marketing costs, testing and showroom preparation.
What transport costs are excluded in most cases?
any transport costs after importation are excluded regardless of who pays
what countries exclude transport from export rather than import
US, South Africa and Australia
Cost of construction, erection, assembly and maintenance?
If this is following importation these costs are not included - For instance if the seller sends out staff along with the goods to install, these costs are deducted
Charges for interest under financing agreement?
These charges can be left out if
Charges shown separately
Financing agreement is in writing
goods are sold at price declared
Charges for right to reproduce the goods in the UK?
Excluded provided they are invoiced separately
Buying commission?
Such as our (Bridgeway) mark-up on ECU costs, can be ignored if itemised separately to our mark-up
Duties and Taxes?
With DDP these costs are excluded from amount payable.
Fees paid for exclusive distro rights??
Not included
3 x categories if additions to price actually paid where applicable??
Certain commissions,
Royalties and licence fees,
Export duties from the country of export/origin
Should selling commission be added??
Yes if the buyer is paying for the agents service
packaging??
Yes in most cases, such as foam chips and boxes
Assists?
Items used to aid manufacture not provided by the importing country are taxable assets and must be included in the total payable amount. Such as dyes, design diagrams and artwork.
Are royalties and license fees part of total price payable?
Yes but only if the following conditions are met.
Payment must be a condition of sale (Goods can’t be imported without paying it).
A clear link of brand to product (Brand visible on box)
Fee must no already be included in price actually paid.
Fee must be paid by the buyer.
Transport and Insurance costs included
Yes - for imports into the UK and EU member states.
Cost included:-
transport to first port of import
Lading/unloading and handling charges.
Insurance costs
Price adjustments for defective goods
Price payed can be adjusted to account for defect discounts.
Requires:
Full details of contractual arrangements
Seller has accepted responsibility
Audit trail
Key Point: TV steps
identify the import sales transaction
determine the price paid or payable
see whether there are some limitations that do not allow the use of the TV
deduct and/or add all the elements that are specified in the relevant guidance
make use of allowable discounts, if applicable
convert currency, if necessary.
Key Point: TV additions
Overseas freight and insurance
Selling commissions and brokerage
Container, packaging cost
Assists
Royalties and licence fees
Proceeds of resale or use
Key point TV deductions
Freight and insurance after importation
import duty and tax
Construction and the like
Buying commission
