Cash Flow Management

King for the business

Indirect taxes tie up substantial amounts of cash: value-added tax and customs duties alone can represent up to 30% of the gross value of all transactions in the supply chain. Yet few businesses realize they can do something to release this cash. Broadly, "free cash flow" can be defined as the total after-tax cash flow generated by the company.

Cash can be released by increasing net operating profit after tax (either through increasing revenue and/or reducing operating costs), reducing working capital costs and reducing fixed capital costs.

The fundamental aims of the process are to identify opportunities to release free cash flow and to implement those solutions which best match your business priorities, time-scales and attitude towards risk. Businesses are often not aware that the proper use of customs arrangements can, besides on customs duties, also have a positive impact on their VAT cash flow position.

Examples Cash Flow Benefits Indirect Tax

1. Efficiency Supply Chain Logistics

Use of bondedwarehousing to postpone/avoid VAT/duty payment (see also Logistics and Procedures)
Use of Single Authorization for Simplfied Procedures to postpone/avoid VAT/duty payment (see also SASP)
Use of available economic customs arrangements to postpone/avoid VAT/duty payment (see also Suspension and exemptions )
Centralize/optimize management of indirect taxes (see also Supply Chain Management)

2. Minimization of duty payments

Valuation Planning (see also Customs Valuation)
Use of preferential rates (see also Sourcing )
Classification planning (see also Classification)

CustomsAdvisoryPlus' services approach

which will uncover opportunities for releasing cash for your company, can be pictured as follows:

More information: contact info@customs.a.plus.com