Every single item which is imported into South Africa, no matter by what means of transport; airfreight, seafreight, courier etc. is compelled to be customs cleared.
Customs Import Duty can be charged by Customs in three ways; namely “free”, “rated or specific” and “ad valorem”. Customs may also use a combination of rated and ad valorum duty, called compounded duty. If the item is “free” this means that there is no import duty to be paid. This is explained in more detail below
Type of Duty and Examples
Furthermore, all import customs clearances attract Customs VAT.
Following is a detailed, yet simple illustration on how the relevant Duty & VAT is calculated.
Customs Duty & VAT
With the commodity, and the customs tariff being a percentage. For eg. if the value of the goods as per the Commercial Invoice is ZAR1000.00, and the Duty is 20%, then the Customs Duty will be ZAR200.00
Additionally, is the Customs VAT which is calculated as follows: Value of the goods on the Commercial Invoice (ZAR1000.00) + 10% = ZAR1100.00. This is known as the Added Tax Value (ATV) Then add to this the Customs Duty amount of ZAR200.00 and you get a total of ZAR1300.00 15% VAT is levied on this total amount = ZAR195.00
Customs VAT only (Free)
Commodities which are Duty free, only pay Customs VAT, which is determined as follows: Value of the goods on the Commercial Invoice (ZAR1000.00) + 10% = ZAR1100.00. Previously mentioned, is the Added Tax Value (ATV) 15% VAT is levied on this total amount = ZAR165.00
Importers who are VAT registered vendors may claim this VAT amount back with their TAX return.
VAT on imported goods from BLNS – Where imported goods have their origin in Botswana, Swaziland, Lesotho or Namibia (BLNS) and are imported from that country the Customs Value must not be increased by the 10 percent.