Contract Price and Full Landed Cost of Imports

The calculation begins with the price agreed with the foreign supplier and the delivery terms. Only components required by the Customs Code are added if they are not already included in the value of the goods. Transport to the place of import, loading, insurance, certain commissions and other amounts are taken into account according to the nature of the specific payment.

The transaction-value method is the primary method. Where the statutory conditions are met, the importer declares the price actually paid or payable with the required adjustments. For other cases, the Code provides methods based on the value of identical or similar goods, deductive value, computed value and the fallback method.

For the owner, the principal result is the full landed cost of the consignment. Duty, import VAT, delivery, broker and warehouse costs are calculated together with the purchase price. Before signing the contract, this calculation allows suppliers, Incoterms, batch size and the future sale price in Ukraine to be compared. A commercial supplier discount is recorded in the transaction documents and considered together with the other sale terms.

Documents Explaining the Declared Amount

The contract and invoice show the goods and price. Where payment has been made, bank documents link the payment to the goods being valued. Freight invoices explain transport costs, and insurance documents explain insurance cost. Separate payments for packaging, commission, royalties or third-party services are considered according to their connection with the imported goods.

Article 53 of the Customs Code contains the list of documents used to confirm customs value. Where the grounds established by that Article exist, customs may request additional materials in writing, and the declarant has 10 calendar days to submit available documents from the relevant list.

For transactions between related parties, whether the relationship affected the price is important. Commercial terms can be explained through contracts, accounting and banking data, calculations and other permitted documents. For regular purchases, it is convenient to maintain a standing file for the contract and pricing and a separate shipment file for each consignment.

If transport or insurance is paid to a separate counterparty, the relevant invoice should be linked to the specific consignment from the outset. This gives the broker a numerical amount for the calculation and gives the accountant the same document for landed-cost accounting.

Adjustment, Release of Goods and Subsequent Documents

An adjustment decision contains the grounds, numerical value of the adjusted customs value and information on the declarant's further actions. For the current consignment, two amounts are important: customs payments based on the declared value and the difference that customs associates with the adjustment. The Code provides for release of the goods against security for payment of the relevant difference where the prescribed conditions are met.

After release, the declarant has 80 days to submit additional documents confirming the declared customs value. Customs reviews those documents and makes a written decision within 5 working days. This allows a company to organise the movement of goods separately from subsequent work on value documentation.

For regular imports, it is useful to compare for each consignment the declared value, freight, insurance, exchange rate, customs payments and actual landed cost. UBC can prepare this calculation, reconcile it with the documents and help organise interaction with the broker and accounting team. The client sees the exact cost and can use it for pricing subsequent shipments.

For the next purchase, the result of the previous clearance can be used as a working base: the same product characteristics, cost structure and documents, while actual prices and transport amounts are updated for the new shipment.