How to Apply for a Drawback of Customs Duty in South Africa

If you are an importer in South Africa, you may be eligible to apply for a drawback of customs duty, which allows you to reclaim some or all of the duty paid on imported goods that are subsequently exported. 

The drawback system is intended to promote export trade and boost the country’s economy. 

However, the process can be complex, and it is essential to understand the requirements and procedures to ensure a successful application. 

In this article, we will guide you through the steps of applying for a drawback of customs duty in South Africa.

What is a Drawback of Customs Duty?

A drawback of customs duty is a refund or remission of the duty paid on imported goods that are subsequently exported or used in the manufacture of other goods that are exported. 

The objective is to promote export trade and reduce the cost of imported inputs used in export production. 

The drawback system is a common practice in many countries and is regulated by customs authorities.

Types of drawback in South Africa

There are two types of drawback available in South Africa:

• Manufacturing drawback: This applies to imported goods that are used in the manufacture of goods that are subsequently exported. 

The drawback is calculated on the duty paid on the imported goods used in the manufacture of the exported goods.

• Commercial drawback: This applies to imported goods that are subsequently exported without being used in the manufacture of other goods. 

The drawback is calculated on the duty paid on the imported goods.

Eligibility for a Drawback of Customs Duty

To be eligible for a drawback of customs duty in South Africa, the following conditions must be met:

• The imported goods must have attracted customs duty on importation.
• The goods must have been exported within three years from the date of importation or used in the manufacture of goods that were subsequently exported.
• The goods must not have been altered or used for any purpose other than export or manufacture of export goods.
• The exporter must be registered for customs purposes with the South African Revenue Service (SARS).

Documentation Required for a Drawback application

To apply for a drawback of customs duty in South Africa, the following documentation must be submitted to SARS:

• Bill of entry or other customs documents proving payment of duty on the imported goods
• Invoice or other commercial documents proving export of the goods or manufacture of goods for export
• Transport documents proving the export of the goods
• Declaration of drawback (Form DA 70) completed and signed by the exporter or their agent
• Any other documents required by SARS

Procedures for applying for a drawback of customs duty

The following are the steps involved in applying for a drawback of customs duty in South Africa:

1. Gather all the necessary documentation, including the bill of entry, commercial documents, and transport documents.
2. Complete and sign the Declaration of Drawback (Form DA 70).
3. Submit the documentation and complete Form DA 70 to the nearest SARS customs office.
4. SARS will review the documentation and verify that all the requirements have been met.
5. If the application is successful, SARS will process the refund and pay the amount due to the exporter’s nominated bank account.
6. If the application is unsuccessful, SARS will notify the exporter of the reasons for the rejection.

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