No, the tax is not levied on Import Export Code. However, customs duty may be levied. Custom duty depends on the category of the products imported or exported. This can be found at the customs departments’ website.
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Import Export Code (IEC) is a code need to take by a person who wants to Import or Export their Goods and Services outside India. Director-General of Foreign Trade, Ministry of Commerce, Government of India issues IEC a 10 digit code. It is a mandatory requirement. No person can proceed Import Export without IEC number.
In this age of cut-throat competition, everyone wants to grow their business beyond the limits of the national market. However, doing business globally isn’t just a cup of tea for everyone. Before going global, you need to follow several procedures and laws in place and get different registration and license. IEC (Import Export Code) License is one of such prerequisite when you’re thinking of importing or exporting from India.
Anyone looking to kick-start his/her import/export business in the country should require Import Export Code (IEC). It is issued by the DGFT (Director General of Foreign Trade). IEC is a 10-digit code which has lifetime validity. Predominantly importers merchant cannot import goods without the Import Export Code and similarly, Without IEC benefits of the export scheme from DGFT, etc cannot be availed by exporter merchants.
An entity can use IEC during its existence and doesn’t need any renewal or any kind of filing. Therefore, for most organizations, it is recommended to obtain the Import Export Code/ IE Code.
Import Export Code is required in the following situation:
a) When importers have to clear the shipments from the customs then it’s required by the customs.
b) Also, when importers send the money to abroad via banks then it’s required by the banks through SWIFT Code.
c) When exporters have to send the shipments then it’s required by the customs port.
d) And lastly, When exporters received the money in foreign currency directly into the bank then it’s needed by the banks.
Features of Import Export Code Registration
An IEC has the following features and benefits.
It acts as the primary proof that a firm is an importer or exporter.
Import or export cannot be done without first obtaining an IEC.
A proprietor can also obtain an IEC, without registering his business.
Once issued, an IEC exists for a lifetime. This means that it does not need any renewal.
It is not compulsory for import or export of goods for personal or governmental purposes.
Quoting an IEC is compulsory when importing or exporting goods.
IEC is compulsory for making foreign bank transfers to business.
It is valid for all branches of importer or exporter.
Advantages of IEC Registration:
1. Expansion of Business
IEC Code helps you to grow your business from local market to international market and expand your product or service
across the globe.
2. Availing Several Benefits
Govt of India always promotes the export activity in India. So, Companies could avail several benefits of their imports/ exports from the DGFT, Export Promotion Council, Customs, etc., based on their IEC registration.
3. No Filling of returns
IEC does not require the filing of any returns. Once allotted, there isn’t any requirement to follow any sort of processes for sustaining its validity. Furthermore, Even for export transactions, there isn’t any requirement for filing any returns with DGFT.
4. Easy Processing
It is fairly easy to obtain IEC code from the DGFT within a period of 10 to 15 days.
5. No need for renewal
IEC code is effective for the lifetime of an entity and requires no renewal. After it is obtained, it could be the used by an entity against all export and import transactions.
Cases where Export Import Code (EIC) is not mandatory
According to the latest circular issued by the government, traders do not require IEC for all who are registered under GST. In all such cases, the PAN of the trader shall be construed as new IEC code for the purpose of import and export.
Import Export Code (IEC) isn’t required to be taken in case the goods exported or imported is for personal purposes and isn’t used for any commercial purpose.
Export/ Import done by the Government of India Departments and Ministries, Notified Charitable institutions need not require getting Import Export Code.
Therefore, if you are looking to expand your market and go beyond country borders and export/import, reach out to our experts and know all formalities you need to get through. Taxsavo also helps you to obtain Registration Online. We are the platform where you can find all solutions for your Business like GST registration, GST Return, Company registration, Income Tax, as well as, Trademark Registration, etc.
- PAN Number
- Current Bank Account
- Bankers Certificate
- IEC Code Number
- The physical application containing required documents should reach DGFT RLA concerned within 15 days of its online submission.
- IEC code holder doesn't need filing of any returns
- IEC Code is issued for life and needs no renewal
- Even people who are proprietors will get the code in their name. It is not necessary to set up a business for a similar
- All importers who import product are needed to register Import export code and all exporter would like this code to get the advantages of exports.