In the industry of import and export of physical goods, the level of scrutiny and compliance is on another level. Points of access to a country (such as the ports, harbors, and airports) have and are being used by parties to smuggle things into various nations. To curb such acts and also hold people accountable, the United States of America introduced the Importer of Record. This title would be borne by a person who would be held responsible regarding compliance to local, state, and federal importation laws and regulations.
It can be held by a company or a person. However, because of the advantages of operating as a company, it would be more prudent for you to operate as a company. Do you need to import something from China, Russia, or the Americas? So visit our website!
So, what or who is an importer of record?
The Importer of Record (IOR) is the owner of goods and products being imported into a particular country. It also can be simply the purchaser or goods broker. The IOR is tasked with ensuring that are the goods in his or her care are documented and also properly valued. Imported goods are usually paid for import duties, tariffs, and other fees. The IOR is responsible for this as well.
The issue of an IOR was conceptualized by the Customs Modernization Act back in 1993. The Customs and Border Protection (CBP) wanted to secure all entry points to the country and ensure all parties with malicious intent can be caught. Besides, the use of an IOR ensures that all payment of duties, tariffs, and other taxes is done so in full. This was done by hinging the responsibility of all valuation and assessment of the imported goods on the IOR.
The implication of being the IOR
As a company, you are a registered business entity. And that means that you have a Tax ID. If that’s the case (which it probably is), you are eligible to be the IOR in the US Market. You don’t need to hire an external company to be your IOR. This comes highly recommended. As operating as the IOR for goods that your company is going to use, you put the company in a position to reclaim 100% of the import taxes (both VAT and GST) that you paid.
If you use a third party as the IOR provider to import your equipment or other goods, you will not be able to reclaim the import taxes. Now you are in the know. In the past and even in the current market, IOR company providers will advertise the ability to reclaim the VAT or GST taxes but this is misunderstood.
If you want more information on IOR, please free to get in contact with us. We will answer all the questions that you may have.