Are you familiar with freight forwarding accounting? Some of you may still be confused about the connection between freight forwarding and accounting.
Well, as it happens, we’re going to discuss this for you.
Accounting in freight forwarding may involve several journal entries, as is often explained.
Let’s dive right into the discussion.
Accounting Aspects in Freight Forwarding
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Taxes
We all know that taxes are an inevitable part of any business, especially in our beloved country, Indonesia. But how are taxes calculated specifically for freight forwarding businesses? Here’s a brief explanation:
Adapted from online-pajak.com regarding taxes for freight forwarding companies:
VAT on Transportation Management Services
Based on the provisions of PMK No. 121/PMK.03/2015, it is stated that for the provision of transportation management services where the service invoice includes transportation costs, a 10% VAT is applied to the amount billed or that should be billed. Thus, the 10% amount is considered a freight forwarding fee, while the remaining 90% is considered a fee billed to the service user.
The imposition of VAT on transportation management services uses an “other value” as the tax base. Therefore, the formula for calculating VAT on these services is
VAT Rate × Alternative Tax Base
10% × 10% = 1%
This 1% VAT on freight forwarding services must be paid by the business owner to their clients.
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Forecasting
Next is forecasting. In freight forwarding, there is a concept called forecasting, which involves predicting a company’s profits or losses for the coming year or the next two years—something along those lines.
Forecasting helps companies estimate future data.
This is important to do, so make sure you, as business owners, give this some thought.
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Cash/Bank
In this regard, it’s important to have a cash account for the company, as this will determine the company’s financial status.
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Transaction Revenue
Transaction revenue in freight forwarding accounting includes profits and losses; everything that comes in or goes out must be accurately recorded by the company.
See Also: Ocean Shipping: Definition and Methods of Shipping
Freight Forwarding Software That Includes Accounting
Oaktree is the first freight forwarding system in Indonesia that is integrated with various divisions such as marketing, operations, finance, and accounting. That’s the gist of it.
So, what does Oaktree cover? Freight forwarding, of course. Freight forwarding itself refers to companies engaged in comprehensive freight transportation services; freight forwarders can function as EMKLs, shipping lines, customs service providers, and even offer door-to-door delivery.
Oaktree is capable of handling a company’s accounting needs because its software covers multiple divisions.