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20 Apr 2011 01:35 AM #1
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Dropshipping Legalities and Custom Fees - Chinese Dropshipper Invoices
Hi Can you please help?! I am starting an online store selling via dropship. Is it legal for the dropship supplier (based in China) to send the package goods without a label or invoice?! They have no label not even their own and will not put my label on either. They send the invoice to me via email then I send an invoice to my customer.
Also they say you do not have to pay customs I think because it's selling low cost items and one package at a time and not wholesale in bulk?!
ALSO when do you start paying Australian taxes (I am based in Australia)? Do you start paying taxes only when you sell a certain amount?! and how do you do that?!
Please help!! your help and guidance is greatly appreciated!
Much Love!!!!!!!!! xoHow a New Online Retailer Made Over 3 million Sales in 1yr With These Sources
20 Apr 2011 07:36 AM #2
Welcome to Wholesale Forum
Let's start from your custom duties / GST query. The bottom line is that, if your involvement in the transaction is interpretable as being the importer, you cannot mark the imported goods as gifts. Let us clarify this. If the goods are sent by the Chinese drop shipper to the end user, but you receive the cost invoice from the Chinese drop shipper and reissue a commercial invoice (with your mark up and business details) to the end user, you are classed as the importer (even if you never get to see the goods). Therefore, in this scenario, you are legally required to class the goods as imports, and not as gifts.
To mark the imports as gifts, the Chinese drop shipper would have to issue the end user with an invoice for the full amount you charged to the end user, and then you would invoice the Chinese drop shipper for your mark up. The end user would have to receive the invoice in the name of the Chinese drop shipper, and then you invoice the Chinese drop shipper for your mark up. This is the only scenario where you can legally mark the imports as gifts, because you are not the importer but acting as an agent for the Chinese drop shipper. The moment you invoice the end user for an imported product, you become the importer, and you are therefore liable for custom duties / GST.
Since your imports are below A$1,000, and there are no custom duties or GST for imported products below this threshold, you could persuade your Chinese drop shipper to include your invoice in the parcels, mark the parcels as imports (and not gifts), and then let the parcel follow the standard imports process. This is the only legal way to get the order directly to the end user with your invoice inside the parcel. The procedure you are following at the moment is, strictly speaking, illegal, even if the end result is the same.
Hope this helps For details on Australian custom duties and regulations please visit http://www.customs.gov.au/webdata/resources/files/importinggoodsbypostfaq.pdfWant To Be An eBay Powerseller?This is the Service You Need.
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