03 RISKS & 07 WAYS TO AVOID CHECKING POST CLEARANCE AUDIT

03 RISKS & 07 WAYS TO AVOID CHECKING POST CLEARANCE AUDIT

Checking settlement reports (also known as Export – Import – Inventory documents) is a regular work of customs departments, especially in industrial zones (Bac Ninh, Bac Giang, Vinh Phuc, Thai Nguyen). ..) Normally, FDI enterprises are fined and retrospectively collected tax due to the amount of raw materials and materials put into production according to the calculation of enterprises, which is proved by the customs inspection team not correct compared to the whole dossier Customs data collected. This problem leads to the following 3 consequences:

• Retrospectively collect import tax and value added tax (VAT) due to incorrect declaration of the quantity of raw materials and products compared to the figures proved by customs offices.

• Sanctioning of administrative violations (misleading on books, software, setting norms, archiving records, not informing or fraudulently declaring other processing establishments, factories, warehouse storage of goods ...). Especially sanctioned at least 20% or from 1 to 3 times the above-mentioned tax arrears (depending on the amount of tax arrears collected) + the late payment fine calculated from the date of customs clearance of imported goods.

• Meeting disadvantages in the process of making customs procedures (changing the flow of declarations, being inspected many times) and the process of settling tax benefits for import and export goods in the future.

Source: taxservices.com.vn

03 RISKS & 07 WAYS TO AVOID

CHECKING POST CLEARANCE AUDIT

Checking settlement reports (also known as Export – Import – Inventory documents) is a regular work of customs departments, especially in industrial zones (Bac Ninh, Bac Giang, Vinh Phuc, Thai Nguyen). ..) Normally, FDI enterprises are fined and retrospectively collected tax due to the amount of raw materials and materials put into production according to the calculation of enterprises, which is proved by the customs inspection team not correct compared to the whole dossier Customs data collected. This problem leads to the following 3 consequences:

• Retrospectively collect import tax and value added tax (VAT) due to incorrect declaration of the quantity of raw materials and products compared to the figures proved by customs offices.

• Sanctioning of administrative violations (misleading on books, software, setting norms, archiving records, not informing or fraudulently declaring other processing establishments, factories, warehouse storage of goods ...). Especially sanctioned at least 20% or from 1 to 3 times the above-mentioned tax arrears (depending on the amount of tax arrears collected) + the late payment fine calculated from the date of customs clearance of imported goods.

• Meeting disadvantages in the process of making customs procedures (changing the flow of declarations, being inspected many times) and the process of settling tax benefits for import and export goods in the future.

03 Main Causes:

• Tax accounting department:

- Accounting entries are not in accordance with the payment process of purchasing raw materials, supplies or the process of selling products that are not consistent with payment documents stored in files, software (wrong payment method, value calculate import tax, exchange rate ...).

- Does not explain the income (sales revenue and other income) of the business.

- Do not monitor consumable materials (wasted raw materials, broken materials, defective products, destroyed ...)

• Parts warehouse

- Incorrectly updating accounting books and warehouse books of raw materials and supplies which have already completed import procedures compared to customs offices' data (wrong quantity, calculation units, values, inappropriate time …).

- Actual inventory data is not identical with figures of import and export department, accounting department.

• Import and export Department

- Data of import and export department, figures of settlement reports are not consistent with the data of audited financial statements (for example: the balance of the end of the accounts 152, 155, 154 ..) .

- Norms for submission to customs offices are inconsistent, inconsistent or incorrect norms are formulated.

- Do not declare or make false declarations when changing the address of processing, manufacturing or storing establishments.

- "Incorrect entry" of HS codes leads to incorrect application of tax on products of enterprises

07 preventive measures:

• Check the entire process from entering raw materials, exporting products, making reports of final accounts among departments in the enterprise.
• Actively inventory and cross-reference aggregate data from warehouse inventory
• Actively monitor construction norms
• Management of consumable materials and materials to not exceed the maximum depreciation level or lower than the prescribed minimum depreciation level
• Any changes related to the place of production, processing or storage of products must be notified in writing to the Customs Department.
• Reference with data of customs authorities (if have)
• Updated new or revised government decrees, circulars on customs declaration.

Source:taxservices.com.vn