ADVANTAGES
The advantages of bonded warehousing
The main benefits of using a bond store are that they increase cash flow by:
- Deferring payment of tax on imported goods
- Avoiding duty costs on goods meant for re-export
- Forgoing payment on goods that are written off
- Delaying duty costs – giving importers time to gather funds
- Making it easier to do VOCs on short-shipped items
Storing imports in a bonded warehouse can also lower taxes and duties by:
Inspection
Importers can have products inspected while they are in a bond store. This gives them the opportunity to ensure their items have been shipped correctly, in the right amount and without damage – before they have to pay duties and taxes.
Examination
With the permission of South African customs, it is possible for importers to take samples of their goods out of bond store so that they can be shown to buyers.
Re-packaging
While goods are in a bond store, importers can re-package them. This is useful for importers with goods in bulk because separating them may result in higher profits.
Re-exportation
Products that are kept in a bonded warehouse can be shipped to other locations, without needing to pay duty in the country where the bond store is situated.
Transference
Goods kept in a bond store can be re-sold by the importer – transferring ownership to another buyer. The new owner becomes responsible for duty and tax payment.