Difference in customs invoice and commercial invoice

Others 416 views 3 replies

CA Raj Doshi

Practising CA

8954 Points Posted on 20 July 2020

In case of exports at FOB plus actual freight insurance, the customs invoice which is prepared for filing of shipping bill is generally as under

FOB - USD 100
INSURANCE ( APPROX ) - USD 2
FREIGHT ( APPROX ) - USD 12

TOTAL CIF 114

But the commerical invoice vwould have actually insurance and freight values

FOB -USD 100
INSURANCE ( ACTUAL ) - USD 3
FREIGHT ( ACTUAL ) - USD 14
TOTAL CIF USD 117

When the customer remits the payment of USD 117, banks ask us to submit documents

Banks credit USD 114 with purpose code Export proceeds
and separately credit USD 3 as Freight amount.

.
.

Now coming to accounting in tally,
We book the export invoice at USD 114 for sake of convenience while filing GST return. In that case, the extra USD 3 received stand on the credit side as advance received which is not the case.

How to solve and what's the right way ?

Replies (3)

CS M Pota

Company Secreatary

3186 Points Posted on 20 July 2020

But how can the bank credit USD 3 separately when the export proceeds come consolidated ie USD 117 in your above case? Bank should give only one credit of USD 117.

CA Raj Doshi

Practising CA

8954 Points Posted on 20 July 2020

The bank closes the remittance against the shipping bill value.And any excess or short fall is currently shown as freight proceeds OR bank charges respectively.

Bank does not agree for USD 117 inward. We submit 2 documents... one for 114 and other for 3.

CS M Pota

Company Secreatary

3186 Points Posted on 22 July 2020

Bank charges is understandable but freight can not be remitted and shown separately CIF shipment and CIF Invoice.Bank must show in break up that how much amount has been received in FC and what is deduction with it nature. You may ask your banker .