Sign up to receive accounting tips, videos, news and webinar info before anyone else
Mailing Address
21750 Hardy Oak Blvd
Ste 104 PMB 63328
San Antonio, TX 78258-4946
(760) 697-1033
Tariffs might seem like just another line item, but they can have a real impact on your business. If they’re not tracked and recorded properly, they can throw off your financials, create compliance issues, and cut into your profits without you even realizing it.
As international trade gets more complex, it’s important to understand how tariff costs show up in your books and why that matters. In this guide, we’ll break down what tariff accounting is, why it’s worth paying attention to, and how to handle it the right way.
What Tariff Accounting Really Means
Tariff accounting is all about how your business tracks and records import taxes, duties, and fees in your books. It might sound like a niche detail, but it plays a big role in how accurately your costs are reported and how well your financials reflect the true cost of doing business.
If you import goods, these costs need to be handled carefully. It’s not just about staying compliant with customs rules. It’s also about making sure your margins, forecasts, and pricing decisions are based on complete and accurate data.
Why Getting Tariff Costs Right Actually Matters
When tariff costs are recorded incorrectly or not at all, it creates problems. Your numbers may look better than they are, which can lead to pricing mistakes, cash flow issues, or even missed red flags in your business.
Beyond the financial impact, there is the risk of penalties or delays if you’re not staying on top of customs rules and reporting requirements. Check out our blog to learn more about the impact of new tariffs and supply chain concerns. On the flip side, when tariff costs are handled properly, you gain better visibility into your operations and more control over your bottom line.
Why More Businesses Are Outsourcing Accounting for Tariffs
Tariff accounting takes a mix of financial knowledge and import expertise, which is not something every internal team has. That’s why more companies are utilizing outsourced accounting teams for this part of their operations, including tariff accountants who know the rules, stay up to date on changes, and have systems built for accuracy.
Outsourcing can save time, reduce risk, and make it easier to get clean, consistent data into your reports. It’s especially helpful for companies that are growing quickly or expanding into international markets where mistakes can get expensive fast.
What a Tariff Accountant Does for Your Business
A tariff accountant helps make sure everything related to tariffs is accurate, organized, and fully accounted for. That means checking how goods are classified, reviewing duty rates, tracking all the right documents, and making sure those costs are recorded in the right place.
They also help avoid mistakes that lead to overpaying or getting flagged by customs. And maybe most importantly, they connect the dots between your finance team, operations, and compliance so everyone is working from the same numbers.
The Most Common Mistakes with Tariff Accounting
One of the biggest mistakes businesses make is misclassifying goods. A wrong tariff code might not seem like a big deal at first, but it can lead to overpaying or even fines down the line. Another common issue is not tracking duty costs properly in the accounting system, which can throw off your cost of goods sold and make your reports less reliable.
Some companies also assume their customs broker or shipping partner is handling everything. In reality, it is your responsibility to make sure those numbers are showing up correctly in your books. Missing that step can quietly chip away at your margins without you even noticing.
When It Makes Sense to Bring in a Tariff Accountant
If you’re starting to import more products, entering new countries, or seeing duty costs pile up, it may be time to bring in a specialist. A tariff accountant can help you stay compliant, avoid errors, and give you a clearer picture of how tariffs affect your bottom line.
Even if you’re not dealing with major issues yet, bringing someone in early can help you build a solid process before problems show up. The right accountant will make sure nothing slips through the cracks and your financials reflect the full cost of doing business.
Final Thoughts on Tariff Accounting and Your Financial Strategy
Tariff costs are easy to overlook, but they can quietly take a toll on your margins and create avoidable risk. Staying compliant isn’t the only reason to prioritize tariff accounting. Having accurate numbers will help you make smarter decisions across your entire business. Whether you handle it in-house or work with a partner like TGG, what matters is having a system that tracks the full cost of doing business and keeps you in control.
FAQs About Tariff Accounting
What is the main purpose of tariff accounting?
It helps businesses track and record import duties and fees accurately so that financial reports reflect the true cost of goods.
Can my regular accountant handle tariff accounting?
They might be able to handle basic entries, but tariff accounting often requires specific knowledge of customs classifications and trade compliance.
How are tariffs recorded in accounting systems?
Tariffs are typically recorded as part of inventory cost or cost of goods sold (COGS), depending on the accounting method and timing of recognition.
What happens if tariff costs are recorded incorrectly?
Incorrect tracking can lead to poor pricing decisions, inaccurate reporting, and in some cases, penalties from regulatory agencies.
Is tariff accounting only relevant to large companies?
No, any business that imports goods can benefit from proper tariff accounting, regardless of size. Even small errors can become expensive over time.
How do I know if I need a tariff accountant?
If your business is growing internationally, dealing with rising import costs, or unsure how tariffs are affecting your margins, it may be time to bring in expert support.
Read More >>>
Matt Garrett is the Founder and Chief Executive Officer of TGG. He is a regular speaker across the country on behalf of Vistage educating business owners on the need for sound financial practices, and is Vice President of the Board of Directors of FINACA. Under Matt’s leadership, TGG has received the following recognition: INC. 5000 top companies in the U.S. five years in a row; one of “San Diego’s Fastest Growing Companies” the past four years; and is among San Diego’s “Best Places to Work.”
