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25 February 2025

Duty Drawback in Australia: A key to tax savings & trade efficiency

Duty drawback is an important program that enables businesses to recover customs duties paid on imported goods that are later exported. Introduced to encourage international trade and stimulate economic growth, it is designed to support local businesses by alleviating the financial burdens of import and export activities. 

In reclaiming customs duties paid on imported goods that are subsequently exported, companies can reduce their overall expenses, improve cash flow and increase profitability. This financial relief can also be beneficial for businesses that import materials or products for manufacturing or assembly, only to export the finished goods to other markets.

By taking advantage of the duty drawback program, businesses can gain a competitive edge, either by offering more attractive pricing or reinvesting the savings into their operations to foster further growth.

What is Duty Drawback?

Eligibility criteria for Duty Drawback

Understanding the eligibility criteria is essential for businesses looking to reclaim duties paid on imported goods that are subsequently exported or used in manufacturing. Here are the key criteria:

  • If you are the legal owner of the goods at the time they were exported from Australia.

You must lodge a duty drawback claim within:

  • 12 months from the date of export for tobacco or tobacco products, or

  • 4 years from the date of export for all other goods.

The minimum amount per claim is AUD100. Multiple claims of less than AUD100 may be combined into a single claim of at least AUD100.

Lodging a Duty Drawback claim

When submitting a duty drawback claim, you must provide evidence that the goods:

  • Had import duty paid upon entry into Australia,

  • Have not been used within Australia,

  • Were subsequently exported. 

You are required to provide supporting evidence for your claim if requested. However, unless specifically asked, you do not need to submit any specific documents along with your claim.

Additionally, you must also ensure that the amount claimed does not exceed the amount of import duty paid on the relevant imported goods.

What is Duty Drawback? - Mainfreight Team member, a girl, in a warehouse

Preparing a Duty Drawback claim

To lodge a duty drawback claim, you must have access to the Import Declaration or its details.
You must retain all documentation for at least 5 years from the export date.

Claims cannot be made if goods were used in Australia, except for:

  • Inspection or exhibition

  • Manufacturing goods for export

  • Processes or treatments where the processed goods are exported

Duty drawback is not eligible if:

  • Goods are valued at less than 25% of their customs value at export

  • The import duty has been refunded

  • Records are unavailable showing duty paid and goods disposition

  • Any other requirement in the Customs (International Obligations) Regulation 2015 is not met

Claims will not be approved without sufficient evidence to prove the goods were imported, duty was paid, and they were exported.

If goods have been sold in Australia, you must provide records to trace the goods back to the original import entry where duty was paid.

How Mainfreight can help?

Mainfreight’s experienced Customs Team, supported by our tailored IT systems are here to support your business through every step to calculate and manage claims. We can assist you in ensuring compliance with all relevant regulations, help you gather and maintain the necessary data and documentation and provide guidance on the proper submission to maximise your claim.

Whether you're unsure about the specific requirements, need help tracking your import declarations or require assistance with calculations, record-keeping and documentation, our team are ready to offer expert advice and streamline the process for you.

Contact your local Mainfreight customs brokerage team today to discuss how we can help optimise your duty drawback claims and ensure a smooth and efficient process.

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