Guide to declaration of Returned Goods

        Returned goods refer to the goods that are returned out of or into the country due to damage, shortness, poor quality or lack of specifications, delay in delivery or other reasons. The code of this supervision mode is “4561”.
        It can be found that there are many reasons for returning goods, but some supervision methods are not applicable to returning goods, including the following situations:

        01 “direct return” (4500) applies to goods returned after entry and before clearance.

        02 The return of import and export goods of processing trade is supervised by “Return and exchange of supplied materials and parts” (0300), “Return and exchange of imported materials and parts” (0700), “Return and exchange of finished products of supplied materials” (4400) and “Return and exchange of finished products of imported materials” (4600).

        03 Return of processing trade equipment, applicable to “return of processing equipment” (0466).

        04 “Lease for less than one year” (1500).

        05 “Duty-free goods” (1741) are returned and transported out of China, and the supervision method is “Other” (9900).

        06 The supervision mode of imported and exported equipment in export processing zones is “Returned equipment in export processing zones” (5361).

        07 The original import and export goods, which are related to the import and export goods without compensation at any cost, are subject to “other” supervision (9900).

        Let’s take a look at the relevant provisions on levying customs duties on returned goods.

        Article 43 Regulations of the People’s Republic of China on Import and Export Duties: Import duties shall not be levied on export goods that are transported into China without changing state due to quality or specification problems within one year as of the date of export. Export duties shall not be levied on imported goods that are transported out of China without changing state due to quality or specification problems within one year starting from the date of import.

        Article 55 Of Measures of the Customs of the People’s Republic of China on The Administration of Taxation on Import and Export Goods: in cases where export goods are transported back to China without changing state due to quality or specification reasons within one year starting from the date of export release, taxpayers shall submit relevant documents and supporting documents in accordance with relevant provisions when going through import declaration formalities. Upon confirmation by the Customs, import duties shall not be levied on the original export goods re-transported into the country and customs duties shall be levied on behalf of the import links.

        Article 56. In cases where imported goods are transported out of China without changing state due to quality or specification problems within one year starting from the date of import release, taxpayers shall submit relevant documents and supporting documents in accordance with relevant provisions when going through export declaration formalities. After confirmation by the Customs, export duties shall not be levied on the original imported goods that are transported out of the country again.

        According to the requirements of the above documents, if the returned goods are transported into and out of China with original package due to “quality” or “specification”, and within one year from the date of original entry and exit release, the nature of the tax exemption can be filled in “free”.
        Three points to note
        01 Quality Specification

        The reason for “quality specification” should be provided with detailed proof of non-compliance with international conventions, national standards or requirements of relevant quality specifications in the contract, instead of simply stating the reason as “poor quality”, etc.
        02 Starting period and closing period

        The starting period is the “release date” of the original entry and exit, and the ending period is the “re-entry and exit date”, which cannot be confused with the “declaration date”.
        03 Grasp the concept of “original state”

        Grasp the concept of “original state”, should be consistent with the form of the original inbound and outbound goods, can not be processed, repaired, refitted, generally can not be used, and some should be judged according to the actual situation.

        Documents to be presented for returning goods

        1. Relevant information of the original declaration goods: including the original declaration form, contract, invoice, packing list, etc.;

        2. Return agreement signed by the buyer and the seller and relevant certification materials;

        3. Written application for return of shipment;

        4. If the goods are returned due to quality specifications, the Customs shall submit the certificate of poor quality or inconsistent specifications issued by qualified commodity inspection institutions if it is deemed necessary;

        5. If export goods returned due to quality and specification reasons are transported back into China without changing state within one year, certificates of export tax refund or tax payment shall be submitted.

Article source：Xiao er of customs affairs