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Guarantee Fee

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Guarantee Fee
A sum paid by the importer to the guarantor, usually as a percentage per annum of the face value of the bills or notes being guaranteed.


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If you can get the local government to be your advocate and use a "guarantee" company, you may be able to obtain financing locally, though the guarantee fee may increase your borrowing rate by 2 or 3 percent.
However, if a taxpayer enters into a transaction with a profit motive, keeps separate books and records and reports a guarantee fee separately on his or her return, the taxpayer may be able to establish an activity as a trade or business.
In its deliberations, AcSEC concluded that an entity should recognize a nonrefundable minimum guarantee fee against a variable fee covering a single film or covering multiple films that are not cross-collateralized as revenue immediately when the entity meets all of the conditions of paragraph 7.
 
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