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Question about transiting products through SG.

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beneuji
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Question about transiting products through SG.

Postby beneuji » Sun, 19 Oct 2014 6:53 pm

Hi all,

I'm coming back to this forum as I got really good feedbacks and answers to my questions the last time.

I'm looking at selling "worldwide" Thai made products. My company is registered in SG.

Ideally, I'd like to store these products in SG, so I can make a nice branded package for them.
I've been reading through IRAS pages but I'm still unclear.

1 - My understanding is that I'll have to pay the 7% GST to clear these products at import, even if I don't intend to bring them into the local market. Is that correct ?

2 - What else should I be aware of when importing products in SG ?

3 - When selling a product to an overseas customer, do I have to add a 7% GST again ?
What about selling locally ?

4 - Also, given the situation, should I be better off looking for a fulfilment center in Thailand ?(and forget about the package branding)
Considering we'll start with a pretty low volume and our products are between 50-100SGD, I haven't really considered that option until now.

5 - Do you guys know of a way for non-business people in SG to get properly educated about buisiness in SG, like import, export, taxes, paperwork, etc ?
My biggest fear here is screwing up my business because I might not have understood clearly what I'm supposed to declare, pay, etc..

6 - Should I just visit IRAS, present my business and ask them questions directly ? (is that even doable ?)

Thanks !
ben

beneuji
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Postby beneuji » Sun, 19 Oct 2014 7:39 pm

I just found this :
Out of scope supplies refers to supplies which are outside the scope of the GST Act. In general, they are:

Transfer of business as a going concern
Private transactions
Third country sales – refers to sale of goods from a place outside Singapore to another place outside Singapore
Sales made within Zero GST Warehouse


Since I buy goods in Thailand to sell them outside SG, does that mean that for my business transactions I would not need to pay GST, unless I'd sell a product on the local SG market ?

beneuji
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Postby beneuji » Sun, 19 Oct 2014 9:43 pm

Here's an update, if anyone could confirm this is correct, that'd be lovely :)

1 - I can use my office premises as a warehouse.
2 - If I want to avoid GST on import I'll have to apply to the ZeroGSTWarehouse Scheme and obtain it(1000SGD under 1MillionSGD of goods)
3 - If I release a product onto the local market, I'll then pay GST on that particular product
4 - If product is sold and sent overseas, no GST to pay

This leads me to another question, if I can use my own apartment as premises for my company, does that mean I could use my own apartment as warehouse and use it to get the ZeroGSTWarehouse Scheme ?

I also discovered that under 400SGD(including CIF) of value, no need to pay GST. But I suppose, receiving my products using small parcels would look suspicious...

Finally, I have a diffuse understanding that if I just import products in a very regular way, paying 7%GST on them, ship them to overseas customers and can prove it, I might be able to get a GST refund. Could someone confirm this ?

Thanks !
ben

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Postby Strong Eagle » Sun, 19 Oct 2014 11:19 pm

I doubt seriously that you will be able to use your office premises as a warehouse. Be aware than Singapore Customs does not want goods to be intermingled in any way. They specify that it must be "a storage based facility". They have very specific tracking requirements and if there is concern that you will end up with goods in Singapore upon which GST has not been paid, you won't be approved.

Most likely, you'll need to find warehouse space set up for the purpose by a bonded company. This is because you are new to the business and have no track record. You'll need to have an inventory system that tracks changes. You'll need to have people that are separate for operations and accounting. But, call Singapore Customs to confirm.

You need to be absolutely clear that you are a registered trader/exporter. For example, if you are bringing in cases of product from Thailand, and then reselling those cases to other registered traders then you probably qualify.

Or, if Singapore is merely a transit center for the goods (shipped from Thailand to Singapore, and simply held until they can be shipped elsewhere), then you probably qualify. Goods can be repackaged but need to be shipped out in the same quantities as they came in.

If, however, you are opening the cases and selling individual pieces from the case to foreign destinations, you probably do not qualify as a trader as you now have imported an inventory to support your business of selling individual pieces or even cases. In other words, you are no longer a step in a supply chain, you are the end retailer of goods.

I make the statement above because you must have customs permits for both the import and re-export of the goods. But again, you should contact Singapore Customs.

I recommend reading the following:

http://www.customs.gov.sg/NR/rdonlyres/ ... ersion.pdf

http://www.customs.gov.sg/NR/rdonlyres/ ... ow_res.pdf

beneuji
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Postby beneuji » Mon, 20 Oct 2014 12:09 am

Thanks for the detailed answer and the links !
These PDF's are sooooooo much clearer than the Customs site layout to me !

I will try to confirm with customs that if I can prove that all the imported goods I paid GST on were then sent to customers outside of Singapore, I should be able to get the GST back.

Thanks !
ben


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