Duty drawback frequently asked questions
Can I Qualify for US Duty Drawback?
If you import into and export goods from the US, then there’s a good chance you may qualify for duty drawback. Even if you don’t do both but importing and exporting happen along your supply chain, you may still be able to qualify. For example, if you import goods, sell them to a customer, and the customer exports those goods, then you and your customer can collectively qualify for duty drawback (and STTAS can help navigate confidential concerns to make that happen). Of course, it’s easier and quicker if you both import and export.
I paid $20 in import duties, and then exported the product – can I get my $20 back?
Yes and no. Of course you could file for duty drawback to get your $20 worth of duty. However, there’s a substantial amount of setup, systems integration, permission from Customs, and work that goes into filing for Duty Drawback. Because of that, we generally recommend pursuing drawback if you expect at least $100,000 of refunded duties per year. This amount of duty refund helps ensure a good ROI on the time you’ll need to put into getting everything set up.
If you expect less than $100,000 of annual drawback refund, we can definitely still assist, but there may be higher fees in lieu of the traditional pricing as a small percentage of your drawback refund.
I’m ready to get started with Duty Drawback, what do I do next?
Once you’re ready to determine if claiming drawback is a viable option for you, you will need to complete our Duty Drawback Assessment. This helps us gauge how to move forward in getting you maximum drawback quickly.
What’s on the Duty Drawback Assessment?
Be prepared – the assessment is detailed and requires a lot of information. You can take a look at it here: Duty Drawback Assessment. The information required includes value and number of imports and exports for the past five years. You can obtain this information from your ACE Portal. We also need an example set of representative documents for an import and an export (not all of them, just one).
Yes, it’s a lot of information to get started, but the work up front will help you move through process quickly toward a faster refund. It really is the minimal amount of information we need to get started – and we’d rather let you know that up front than over several conference calls.
What if I can’t find every single item needed for the Drawback Assessment?
If you get stuck or are missing one or two documents, don’t stress! We’re on your side and we can still move forward. Submit the assessment with as much data as possible, and we’ll talk through how to get any missing pieces of required information.
Why do I need to provide the volume/value of exports to Canada, Mexico and Chile vs. the rest of the world?
There are a few free trade agreements that can impact how much drawback you can claim. Depending on the type of drawback you qualify for, your refunds may be reduced for exports to Canada, Mexico and Chile. Obtaining value/volume information for exports to those three countries allows us to better assess your drawback opportunity.
What happens after I submit the Drawback Assessment?
First of all, give yourself a pat on the back – that was a lot of data to submit. Thank you. The assessment goes straight to our Drawback Solutions team, who will personally review it. From there, you can expect someone to reach out to you and discuss your submission and discuss next steps.
Do I need to request permission from the government to claim drawback?
Yes, depending on the type of drawback you qualify for there are various applications and rulings that you may be required to file in order to qualify. These rulings and applications are subject to approval by U.S. Customs and Border Protection (CBP).
What if my applications are pending with CBP, may I file drawback claims pending those approvals?
Yes, you may file drawback claims pending approval of the required applications or rulings. However, CBP won’t process or pay those drawback claims until the required applications or rulings are approved.
We’ve never participated in a duty drawback program before. Can we file drawback on past transactions?
Yes, you may qualify for drawback on import and export transactions that already occurred over the past 5 years. You can file a drawback claim today for goods that were imported 5 years ago and exported after the import date.
When can I expect my first Drawback Refund?
We’ve seen most of our clients receive their first refund within six months of first contacting STTAS. Now, there’s a lot of variability in that – some controllable and some not. If you have a great IT team that we can work with to get our two systems talking with each other quickly, that expedites the timeline. Drawback, however, does require approvals from the government, and those timelines are less controllable (although we’ll discuss the averages and what to expect).
My company does not do both import and export, but my supply chain does (vendors, customers, etc.) – can I still receive duty drawback?
In many cases, you can still receive duty drawback even if you are not importing and exporting. For example, if you buy imported products from a U.S. vendor, then export those goods, STTAS can work with you and your vendor to set up an agreement to claim duty drawback. There’s often concerns about confidential data (cost data, etc.). We’ve navigated this before, and can act as the intermediary to keep confidential information safe. In the end, everybody can win as the duty drawback is claimed and divided up between the parties without any trade secrets being shared.
Is there an option to file for drawback for one specific shipment (or destruction)?
Yes, but with some additional requirements. In order for this to be a viable option for a customer, STTAS must be engaged prior to the export of the planned shipment (or the destruction of the goods. Due to the inherent complexities of this type of drawback, it is generally not an ideal option for lower value shipments.
Non-traditional duty drawback situation? No problem.
If you both import and export, then the duty drawback opportunities are straightforward
However, sometimes it's more complicated. Multi-party supply chains that import on one end and export on the other can still claim duty drawback. It can take more time and effort, but we'll guide you through it.