Frequently Asked Duty Drawback Questions
How much does your service cost?
Our fee is a competitive percentage of the duty recovered. The percentage rate is dependent on various elements of a drawback program such as the duty recovery levels, statutory filing provision, and administrative resources required. This model incentivizes us to maximize your duty drawback recovery compliantly.
Is your program bound by a contractual obligation?
Nope! Our service agreement is at-will and can be terminated at any point in time without cause. We want to continually earn your business.
What percentage of the duties does Customs refund to the drawback claimant?
US Customs and Border Protection refunds 99% of the duties, fees, and taxes paid.
Can we claim drawback on past imports or only moving forward?
The drawback law allows for a 5-year look-back from the date of importation. The only other time requirement is that the date of the qualifying export needs to be after the import date.
Typically, client’s with unclaimed retroactive refunds can expect a windfall of recovery within the first year of their drawback program being implemented. For example, if a claimant’s annual recovery is $500,000; they can expect approximately $2,000,000 to $2,500,000 by claiming drawback on historical duty paid imports.
How long does it take to receive payment?
Claimants filing under accelerated payment (completed in our implementation) can typically expect a refund within 30 days from the date of filing. Without accelerated payment, a claimant could wait one year or longer.
How long does it take to implement a program and file a claim?
This depends on a variety of factors including the number and complexity of the import and export transactions, the availability of electronic records, the number of parties involved in the import and export transactions, and the motivation level of the company. Generally, the process takes between four and eight months from startup to receiving their first refund check.
What happens if Customs and Border Protection issues a desk review or audit of my claims?
We act as your liaison with Customs and Border Protection to manage all desk reviews and audits of your drawback claims to ensure a successful outcome by maintaining our regulatory compliance procedures.
Can we automate drawback the process?
The collection of certain required elements of a drawback process can be automated. In some cases, we can automate the entire process depending on several criteria but most importantly based on the applicable drawback statutory filing provision. In other words, the data requirements vary based on the legal and regulatory provisions applicable to your drawback program. Filing drawback on chemicals is different from filing on retail merchandise shipped to Canada or on electronic components. Further, the availability of accurate electronic data also determines the level of automation that can be achieved. No one steadfast rule applies. Each program’s ability to automate must be assessed specifically. Additionally, other administrative functions can be alleviated from your trade compliance team.
We assess each client potential program with a number of these key variables in mind and the then develop data processing procedures that allow us to maximize a program with the least amount of commitment of administrative resources. Further, we always endeavor to alleviate our client’s commitment of resources so that you can stay focused on your core business process. First step, let us assess your potential program and determine exactly what parts of the data collection process lend themselves to accurate automation.
What do we have to do to support the drawback process?
During your drawback program’s implementation a main point of contact is established within your company. Generally, the individual’s responsibilities will be to manage communication from our team and provide certain data or records elements we cannot access.
We want to alleviate all of the administrative burdens associated with elements of your program, such as working with your brokers, freight forwarders and other third parties for data and record collection.
What records must we maintain to support drawback claims?
In most cases, a drawback claimant should not need to implement new record retention procedures.
For imports, we will gather and maintain CF7501 entries, commercial invoices, packing lists, and inventory records. For exports, we gather and maintain bills of lading, commercial invoices and inventory records. For manufacturing, bills of material and production records are needed. Customs can also review, but not limited to, accounting inventory and production records, if applicable.
We will review and validate your existing record retention to ensure regulatory compliance and make best practice recommendations if needed. Data and records are stored on our cloud storage center that is SOC 1/SOC 2/ISO 27001 certified with AES 256-bit encryption and HMAC key-hashed authentication with managed access. All drawback records related to a claim must be retained for 3 years after liquidation, per 19 CFR 190.15.
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