What are the discounts in the commercial invoice that are not acceptable by Customs? Which are the ones to deduct from the invoice value for GST?
A discount will be considered in determining the transaction value of the imported goods if the discount was originally given in order to reduce the net amount that the buyer paid for and agreed upon prior to the importation of goods.
Type of discounts acceptable by Singapore Customs:
The discounts given by importer such as cash, quantity or trade discount can be accepted and excluded for GST computation purpose.
Importer should state the type of discount clearly in the invoice or provide a letter to explain on the nature of discount given.
Discounts given in lieu of the following reasons are not allowed:
- The buyer and seller are related and the transaction price is affected due to the relationship;
- The buyer undertakes certain activities for or on behalf of the seller as part of the payment under the contract of sale;
- The buyer provides other goods/services to a third party for or on behalf of the seller as a condition of sale for the imported goods; and
- The price of the imported goods has received credits made in respect of earlier transactions.
Related questions
An importer acquires a machine from an overseas supplier. The list price of the machine is S$200 but the supplier grants a 10% trade discount to the buyer because he operates at the retail level of trade, resulting in a total price paid or payable of S$180. What is the Customs value?
I received a discount for my online purchase. Do I have to pay GST for the original value of the purchase before discount?
I have been offered a quantity discount of 10% by my supplier. Should the discount be reflected in the Customs value?
An importer intends to hand-carry goods via Changi Airport but his invoice only shows the value of the goods without insurance and freight charges. How would the GST be computed?
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