Customs procedures for warehousing of goods (bonded warehouse) |25 March 2011

The Inland Revenue is the section within Customs with the authority to administer private bonded warehouses.

It keeps documentary and physical control over the movement of goods imported into the country on which payment of applicable taxes (incl. trades tax, GST and levies) is deferred by storing in licensed bonded warehouses. It allows the importer to hold imported goods in the country and the applicable taxes are deferred until such time that the goods are ready to be removed from the bond. Such a facility can be very beneficial to companies.

What are bonded goods?
Bonded goods refer to goods placed in a bonded warehouse on which taxes have been deferred. This deferred payment facility distinguishes bonded goods from other imports.
There are now only a few items that are allowed under the bonded warehouse facility. These goods are:
• Motor vehicles
• Alcohol
• Tobacco
• Fuel
 
How to apply for a licence for a bonded warehouse
All bonded warehouses have to be appointed and approved before coming into operation. All applications must be made in writing to the Seychelles Revenue Commissioner.

The applicant must submit the following information:

• The location of the proposed warehouse
• The design of  the proposed warehouse
• Security arrangements that will be in force
• Types of goods intended to be warehoused
• The person who will be in charge of the bonded warehouse (warehouse keeper)

What are the procedures for a bonded warehouse?
When Customs receives the application, the proposed location and building will be inspected to check that requirements are in order. If the proposal meets all Customs requirements, an agreement will then be drawn up with all Customs terms and conditions for that will be in force.

Is there an administrative fee for a bonded warehouse?
 The owner of an approved bonded warehouse is required to pay an administrative fee of R10,000 per year. The owner must also take out a bank guarantee which should be sufficient to cover the maximum tax liability of the goods that will be stored in the warehouse at any given time.

What is the duration for warehousing or re-warehousing of bonded goods?
Goods are allowed to be warehoused for a maximum period of one year, after which they must be cleared from the warehouse or re-warehoused. Goods which have been re-warehoused should be cleared within two years from the date of the first entry into the warehouse.

How bonded goods are monitored by Customs
Every movement of goods to or from a bonded warehouse needs to be covered by the appropriate bill of entry (unless the goods are to be destroyed as in accordance, with regulation 164 of Trade Tax). The applicable tax must be paid before goods are removed from the bonded warehouse.

Periodic spotchecks are carried out to ensure that the physical stock tallies with the records. The number of checks will be determined by Customs depending on the risk level attached to the bonded goods and the type of goods. These spotchecks are very important to ensure that the warehouse conditions are being abided by. Any breach of the conditions of approval is considered a serious offence and might result in severe action under the appropriate regulation of the Trade Tax Regulations 1997.

A warehouse keeper needs to submit a monthly stock return of each category of goods in the bonded warehouse, and it has to be submitted within seven days at the end of each month showing:
• The opening balance;
• Goods received with the bill of entry number;
• Goods issued with the bill of entry number;
• the closing balance.
• 

Where do I go for more information?
For further information or clarification on warehousing of goods, please contact the Inland Revenue at the Customs Division on tel: 294911 or contact us at the following address: Seychelles Revenue Commission, PO Box 50, Orion Mall, Victoria. Tel 293737. Email: Commissioner@src.gov.sc

Contributed by the Seychelles Revenue Commission