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Traders  & Businesses Masthead

Payment of Duties & GST


Determining the Duties & GST Payable
Special Requirements
Rate of Exchange
How to Make Payment of Duties & GST?



Determining the Duties & GST Payable  

Where the goods are dutiable, ad valorem or specific duty rates may be applied. The taxable GST value for dutiable goods is calculated based on the CIF value, or the value of the last selling price (LSP), if there has been more than one sale, plus all duties and other charges.

In the case of non-dutiable goods, the GST should be based on the CIF value plus any commission and other incidental charges whether or not shown on the invoice, or the value of the LSP. The CIF value if shown in foreign currency should be converted to Singapore dollars by using the prevailing Customs exchange rate.




Special Requirements

Flat Rates for Freight and Insurance

For invoice value quoted in FOB terms and the freight and insurance charges are not known or are not available to the importer, or where the freight charges cover two or more invoices of varying invoice terms, flat rates for freight and insurance shall be used to arrive at the CIF value.


Definition of Free On Board (FOB)

"Free On Board" means that the seller fulfills his obligation to deliver when the goods have been placed on the ship at the named port of shipment. This means that the buyer has to bear all costs and risks of loss of or damage to the goods from that point. The term FOB requires the seller to clear the goods for export. This term can be used only for sea or inland waterway transport.


Definition of Cost, Insurance and Freight (CIF)

"Cost, Insurance and Freight" means that the seller delivers when the goods have been placed on the ship at the port of shipment.

The seller must pay the costs and freight necessary to bring the goods to the named port of destination but the risk of loss or damages to the goods, as well as any additional costs due to events occurring after the time of delivery, are transferred from the seller to the buyer. However, in CIF, the seller also has to procure marine insurance against the buyer's risk of loss of or damage to the goods during the carriage.

Consequently, the seller contracts for insurance and pays the insurance premium. The buyer should note that under the CIF term, the seller is required to obtain insurance only on minimum coverage. Should the buyer wish to have the protection of greater coverage, he would either need to agree as much expressly with the seller or to make his own extra insurance arrangements.

Traders are allowed to use the standard rate provided by Customs for freight and insurance to compute the CIF value of imported cargo when the actual charges are not available.

The flat rates for freight and insurance to be used are:

Place of Export

Flat Rate for Freight and Insurance charge

Africa, Canada and USA

24.5% of FOB value

Europe

19% of FOB value

Japan, Australia and New Zealand

19% of FOB value

China, Taiwan, Korea, Sri Lanka, India and Pakistan

15.5% of FOB value

Myanmar, Thailand, Cambodia, Laos, Vietnam, Hong Kong, Philippines and Indonesia

9.5% of FOB value

Peninsular Malaysia

5% of FOB value


Similarly, for invoice value quoted in C&F terms, traders can use a flat rate for insurance at 1% of the C&F value to compute the CIF value.

With effect from 1 May 2003, traders can set the insurance to zero value, if no insurance charges were incurred in the importation of the goods.




Rate of Exchange

The rate of exchange used in the conversion of the foreign currency quoted in the invoice into Singapore dollars should be indicated. The rate must be the prevailing rate quoted by Customs at the time of declaration if the currency is one of the common foreign currencies listed in the Customs rates of exchange. If the foreign currency quoted in the invoice is other than those listed currencies given by Customs, a trader can use the selling rate quoted by a commercial bank for that currency. In this case, the trader is required to declare the name of the bank, telephone number and the date on which the rate was quoted in the "remarks column" of the Customs Duty/GST payment declaration.

The Customs rates of exchange are downloaded on a weekly basis to all TradeNet® users. Other traders who wish to know the Customs rates may access our link here.

For FAQs on exchange rate matters, click here.




How to Make Payment of Duties & GST?

The actual importer is responsible for the payment of any duties, GST and other miscellaneous fees (“taxes and fees”) to SC upon importation of their goods. The importer may apply for an Inter-Bank GIRO (IBG) account with SC or they may appoint a forwarding agent to pay the taxes and fees on their behalf. All payment of taxes and fees must be made to Singapore Customs through the IBG facility. Please download the IBG form ( DOC 323kb )  and submit the duly completed originally signed form by post or hand to Singapore Customs.

The payment of taxes and fees will be deducted from the declaring agent’s account if the importer does not have an IBG facility with Singapore Customs (SC).

If the importer wishes pay taxes and fees directly to SC, it has to maintain an IBG facility with SC, and efile for “Application for Authorisation of Declaring Agent” from our website here. Once the application has been approved, the importer has to inform the declaring agent to deduct the payment directly from its IBG Account.

Upon approval of a payment declaration, the payment of duties and/or GST will be made through the IBG arrangement. The payment mode for duties and/or GST will be reflected as one of the condition codes in the permit. The two codes are:

GF

Successful GIRO deduction of the amount to be paid from the importer's account. Importer must have enough funds in bank account to meet payment before instructing the declaring agent to make this declaration.

G7

Successful GIRO deduction of the amount to be paid from the declaring agent's account. You must have enough funds in your bank account to meet payment before making the declaration.

 




Frequently Asked Questions


For FAQs on customs matters, click here.

 

Customs Circulars


For Circulars on customs matters, click here.



E-Learning Courseware


For e-learning to the ‘Guide to Customs Procedures’, click here



Last reviewed on 15 April 2014
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