Glossary
What is the transaction value method?
The transaction value method –Method 1– is the primary basis for valuing imported goods for customs. It uses the price actually paid or payable for the goods when sold for export to the country of import, adjusted by specified additions and deductions. |
Conditions for using Method 1
- There is a sale for export to the country of import
- No restriction on the buyer’s disposal or use of the goods, beyond limited permitted exceptions
- The sale or price is not subject to conditions for which a value cannot be determined
- No part of any resale proceeds returns to the seller unless an adjustment can be made
- Buyer and seller are unrelated or, if related, the relationship did not influence the price
The transaction value method formula
Price actually paid or payable, plus additions including commissions other than buying commissions, packing, assists, royalties and licence fees, and transport and insurance to the place of introduction. Post-importation transport, duty and taxes are excluded where shown separately.
What happens when Method 1 fails
Valuation moves down a fixed hierarchy: identical goods, similar goods, deductive, computed, then the fall-back method. The order is mandatory you cannot select the one that suits.
iCustoms builds the customs value from your invoice and freight data, with every addition shown and evidenced. |
