Custom Duties in Malaysia

How to Avoid from Custom Duties in Malaysia

Updated on February 17, 2011 By xtremepassion 114 Comments

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Recently I received a “Notis Tahanan & Perlatikan Agen (PK1)” (refer figure1) from EMS to asked me go to collect my parcel from Custom Department. The parcel is sent by my vendor from USA.

Sample

Figure1: Sample of Notis Tahanan & Perlantikan Agen (PK1)

Why My Parcel Onhold at Custom Department?

Ans: The AWB [USPS-United States Postal Service] on top of the parcel show the Total Value of 1,159.95 MYR ( 1,159.95 MYR ( $300))USD++ (Approximately RM1K++) in which exceeded RM500 (will be taxable). The parcel shown as “High-value goods” when I check through the EMS tracking shipment page.

Others reason may due to the customs needs proof of the parcel exact value rather than based on the value written on your AWB. In this case, you need to present the official or commercial invoice to make the declaration for your parcel.

The others methods will be, asked your sender to put the invoice in between or beneath the AWB to show the value of your parcel without sending it personally to you.

How much I will be charged on top of that?

Ans: According to custom officer, sanitary cloth pads (HS Code: 6307.90.100) required 20% import duty + 10% sales tax + RM49.80 (EMS delivery charges??!!). Total up, cost me nearly RM450. Woww !!! I get shocked because I didn’t expected it will be so expensive.

What action I had took?
Ans: I returned back the parcel to my vendor instead let the custom department suck my blood! The custom officer allowed me to return it back to my vendor by written “Return to Sender” + Signature + written down my IC in the custom printout form. The custom officer told me they will sent it back using the same method as the vendor shipped to me and the shipping cost will revert back to my vendor. I am not able to shipped the parcel back to my vendor using my own PosLaju account because the parcel did not release to me and still held in custom department.
What I had learned from this incident?
1) There are import rate + sales tax applied on top of the imported parcel / merchandise which exceeded RM500. Check properly for the import item categories as taxable or non-taxable items.[customs tariff]
2) Custom officer required the official invoice for custom declaration. As an additional proof, they also need you to provide them with your payment receipt to show them the exact amount you pay to your vendor/sender in case they do not believed the value/amount stated inside the invoice [I faced this issue as 1 middle aged lady from the custom threaten me that I will be compound by showing the make up invoice with no concrete proof {*speechless*}, that is why I returned back the parcel back to my sender]. They encourage the user to make the payment via credit card through paypal so that to show them the email by paypal as proof.
3) You may request your shipper/sender provides you with a commercial invoice as a proof to the custom department for the value of the parcel. You may refer or download the SAMPLE OF COMMERCIAL INVOICE HERE. It is advisable to place your commercial invoice together with your AWB so that custom officer easy to find it.
Useful Information Sourced from [bicarahati.com]
Tarif Bercukai dan Pengecualian.
[Taxable Customs Tariff and Exemption]
Penghantaran Melalui EMS[shipped through EMS]
Nilai Barang[Goods/Parcel Value] + Kos Pengeposan[Shipping Cost] = < RM 500 (Dikecualikan cukai)[non-taxable]
Nilai Barang + Kos Pengeposan = > Rm 500 (Dikenakan cukai sekiranya barang ditaksir bercukai)[taxable if goods declare as taxable items]
Nilai Barang + Kos Pengeposan = > RM 1000 (Jika Bercukai, akan dikenakan Borang Ikrar Kastam K1 dan dicukai)[if taxable item, required customs K1 form and taxable]
Nilai Barang + Kos Pengeposan = > RM 1000 (Tidak Bercukai, tidak dikenakan borang ikrar)[non-taxable item, not required customs declaration form]
Nilai Barang + Kos Pengeposan = > RM 2000 (Tidak Bercukai, Dikenakan Borang Ikrar Kastam K1)[non-taxable item, required customs K1 form]
Nilai Barang + Kos Pengeposan = > RM 10000 (Cukai atau tidak, Akan Kena borang K1A)[either taxable or non-taxable, required customs K1A form]
Penghantaran Melalui Udara (Airmail)
Nilai Barang + Kos Pengeposan = < RM 500 (Dikecualikan cukai)
Nilai Barang + Kos Pengeposan = > Rm 500 (Dikenakan cukai sekiranya barang ditaksir bercukai)
Nilai Barang + Kos Pengeposan = > RM 1000 (Jika Bercukai, akan dikenakan Borang Ikrar Kastam K1 dan dicukai)
Nilai Barang + Kos Pengeposan = > RM 1000 (Tidak Bercukai, tidak dikenakan borang ikrar)
Nilai Barang + Kos Pengeposan = > RM 2000 (Tidak Bercukai, Dikenakan Borang Ikrar Kastam K1)
Nilai Barang + Kos Pengeposan = > RM 10000 (Cukai atau tidak, Akan Kena borang Ikrar Kastam K1A)
Penghantaran Melalui Laut (Seamail)
Nilai Barang + Kos Pengeposan = < RM 200 (Dikenakan cukai sekiranya ditaksir bercukai)
Nilai Barang + Kos Pengeposan = > Rm 200 (Bercukai atau tidak, akan dikenakan Borang Ikrar Kastam K1)
Borang Ikrar Kastam K1 tersebut turut memerlukan dokumen sokongan seperti kebenaran atau Permit dalam kes-kes tertentu seperti import handphone dan lain-lain berkaitan.[Customs K1 form required supportive documents (eg: permit) for certain specific cases for example imports hand-phones and etc.]
Alternatives Solution To Avoid from Custom Duties:-
1) Request your vendor/shipper to shipped out the parcel with value less than RM500 (~$ 579.98 MYR ( 579.98 MYR (150USD))).
2) Request the vendor/shipper separated your parcel into few shipments instead shipped all at 1time.
3) Normally, proforma invoice prepared by vendor/shipper with rather lower value than official invoice for custom clearance purpose.
4) Buy me a coffee and I will teach you how *Personally*. Ha~~
*** UPDATED BY 13 FEB 2012 ***
Will it still taxable if I labeled the parcel as gift, sample, used (second hand) or personal used?
Depends on:-
i) Customs Officers
ii) Your luck
iii) Parcel’s content
iv) Parcel’s declare value (including shipping cost)
Below are some of the experienced I collected online:-
“It has nothing to do whether you label it gift, personal, used or so on. Custom can tax whatever they want even if it is a gift, personal or used item.”
“Customs officers told me that it is by chance. If they opened your package and see that there a tags, they will impose tax based on the value that your seller declare.”
“Actually, duty tax depend on the custom officer who evaluate your parcel. It is up to him to accept or denied your explanation and dispute, and it is up to him to believe you or not. Custom officer have the rights to tax you base on the price that they believe (NOT by the price your seller declared).”
“…to dispute the duty tax, you need to go to custom office. This is not available if your seller using courier service, because for courier service, if any LOW duty tax (for Malaysia, it is RM500), the custom will clear it first and bill it to the courier company, the courier company will then bill it to you when you get the item. Then it is not negotiable/disputable anymore.”
“…get the sender to sent separately in envelopes instead of one huge box. Customs are alerted when there is a box especially a huge box. Sending in envelopes or small boxes are usually passed without tax. I don’t know about large boxes of many items but for one item, customs charge 10% on declared value + shipping.”
Any golden rules or possibilities to avoid or escape from duty tax in legal way?
1. Break the shipment into a few small shipments, said one piece per shipment that not more than 0.5kg.
2. Ship via normal mail instead of parcel or courier.
3. If you do not want to be taxed, go under the less-than-RM500 rule.
4. If its value is high, split the items to the said price tab and get them shipped weekly.

*Find it helpful?! Please buy me a coffee*

My sincere apologise if this article makes you misunderstood that I am the custom expert. Please be informed that this is just for sharing purposed.

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