In the wake of a global lockdown and travel restrictions, there came a resurgence in economic activity. Governments the world over poured relief funds into all types of commerce, hoping to jumpstart businesses across all platforms and trade areas. Add to that the incredible shift to online trading, virtual enterprises and streaming medias, then you find yourself in a world where goods and services cross borders at an alarming pace.
Because of companies like Amazon and Zalando, it became clear that location was no longer an issue. This opened a door for those contemplating importing and exporting opportunities in South Africa. Products and services are in high demand, regardless of where the products are sourced from or manufactured.
Seize the opportunity
Let’s assume you have a killer product on your hands and a competitive edge to boot. You have ironed out all the wrinkles, established a sustainable and profitable production process, and you can supply to a fair demand in, or outside of, South Africa. You are ready to take the next step and start exporting or importing products.
Before you start moving goods across borders, the first course of action would be to apply for an import license or export license.
To register your import or export business, you will need the following:
- Company registration documents
- Copy of Director’s Identification
- Proof of address (municipal account or lease agreement)
- Proof of contact number (recent phone account)
- Business bank statement with a company stamp
- Tax profile of your company
- Registered tax representative (more on this below)
The South African Revenue Services (SARS) leads the charge in executing taxation laws as regulated and drafted by the National Treasury. The purpose of submitting the tax profile of your is to assure SARS that you are tax registered and tax compliant. Failure to comply with current legislation is a criminal offence and could result in serious penalties.
Appointing of a registered tax representative
This is not as straight forward as it sounds. SARS stipulates that the registered tax representative needs to be a natural person living within the borders of South African, with a SA Identification, physical address and a personal tax profile. It is imperative to appoint someone who ticks all these boxes, because they will be the first person SARS will contact if there are any discrepancies, queries or irregularities.
How to overcome the foreign currency stumbling block
One of the biggest concerns in the import/export readiness process, is the exchange rate. It is the one component that is impossible to plan for, especially in the current financial climate. Opening a foreign currency business account with a trusted banking institution, can bring some calm to the chaos. A foreign currency account means that clients can buffer themselves against fluctuating exchange rates by keeping funds in the account. By transferring funds from US Dollar to South African US Dollar, it also eliminates unnecessary conversion charges that might eat into profit margins.
How can we help you?
Constant regulation changes, complex tax laws and general confusion around currency movements, often hinder the ideal of being compliant. Our team of experts can assist you with the entire process, from documentation to registration. While import/export license applications usually take 30 days to be issued, we aim for a turn-around time of two days.
With a variety of business units under one umbrella, we can register new companies, advise on how to structure these companies, assist with a legal tax representative, guarantee foreign currency accounts, and guide you through the accounting, tax and legal minefields.
Debbie Hodgson, Foreign Company Consultant