When you complete the FedEx Express® or FedEx Ground® International shipping label, you can select the shipper, recipient, or a third party as the person responsible for paying duties and taxes. If no party is selected on the shipping label, the recipient is used as the default responsible party. Delivered Duty Paid (DDP) is a supply contract in which the seller assumes all responsibilities, risks and costs associated with the transport of the goods until the buyer receives them or delivers them to the port of destination. This agreement includes payment of shipping costs, export and import duties, insurance and other costs incurred during shipment to an agreed location in the buyer`s country. If a DDP shipment is not cleared, Customs may ignore the fact that the shipment is DDP and delay the shipment. Depending on the customs decision, this may cause the seller to use different and more expensive delivery methods. Many countries grant tax breaks (either customs duties and an import exemption or a post-export refund) for items that are temporarily imported or exported, provided that certain conditions are met and that procedures are followed. For example, items are often imported or exported temporarily for: duties, taxes, and other fees may be due when importing a shipment. FedEx may pay these fees as assessed by Customs on behalf of the payer. Fees depend on the amount paid.
You can use FedEx International Shipping Assist to quickly estimate your shipment`s duties and taxes, determine the harmonized code, find the required customs documents, and more. Just sign up and provide some basic information about your shipment to get started. Customs officers use the declared value of a shipment (the value that the shipper indicates on the goods to be shipped) as well as the description of the goods to determine duties and taxes. It is important to ensure that the specified value is correct. Inaccurate declared values are one of the most common reasons for customs and tax disputes. Note: Under the contract of carriage with FedEx, the shipper is ultimately responsible for all duties and taxes levied on the shipment. If the recipient rejects the package or if the recipient or FedEx account holder refuses to pay the duties and taxes, the duties and taxes will be charged to the original sender. The most common method of valuation is the transaction value method. This means that the value of the goods on the commercial invoice must correspond to the value that the buyer paid for the goods.
For example, if a buyer in the U.S. purchased a computer from a Canadian dealer for $2,000, the seller must indicate that value on the commercial invoice, even if the seller`s cost of purchasing the computer was only $1,000. When Canadian duties and taxes are imposed, Canadian postmen collect them on delivery, plus an additional $9.95. Some recipients simply decide that taxes and fees are too high and refuse delivery. A package can also be held at customs, so your customer will have to pay duties and taxes before picking up their package. It is important to consider the impact of duties, taxes and other handling charges when determining the total cost of an international shipment (also known as land costs). Depending on the content of the shipment and the country of destination, handling charges can have a significant impact on total shipping costs. The ability to calculate and communicate landed costs in advance can save both the shipper and receiver valuable time and effort. In some cases, VAT, duties or taxes of various kinds are levied by the country of destination.
Please note that additional charges for taxes or customs clearance are the responsibility of the recipient, as these unpredictable costs are not under the control of our company. It is recommended to contact your local customs office for more information, as tax policies vary greatly from country to country. Advance payment of duties and taxes prior to delivery to the recipient may be required if the recipient does not have a valid FedEx customer number or FedEx account in good condition. Shipments are kept at the destination station until payment agreements are concluded. The customs clearance services offered as part of FedEx`s international services are intended to facilitate ® the importation of goods for consumption in this country. Therefore, they do not contain any special procedures that may be necessary to meet government requirements for customs duties and tax relief at the time of export or import. With Canadian prepaid duties and taxes, your First Class Package International (FCPIS) package will be delivered directly to your customer`s door without delay or all charges will be due on delivery. Our low flat rate covers all taxes free of charge and clearly, including customs duties and value added tax (VAT).
Many countries allow the importation of gifts duty-free if the value of the gift is less than a certain amount and the gift sent is not considered a regulated or prohibited product. Any gift that exceeds the value indicated may be subject to import duties and taxes. However, with the help of the prepaid customs tax service, which is available according to your wishes, taxes of different types levied by the destination country can be paid in advance. Therefore, you don`t have to worry about your package being held by local customs. Please also note that the prepaid customs tax service incurs an additional service fee and the additional warranty service is irrevocable, which means that the calculated service fee cannot be refunded or cancelled under any circumstances. In some countries, duties and taxes must be paid before shipments are cleared. The amount of customs duties and taxes of a shipment is based on the following: duties and taxes are levied to generate revenue and protect local industry; Almost all shipments that cross international borders are subject to customs and tax valuation by the government of the importing country. Customs officers collect duties and taxes based on the information on the shipping label, commercial invoice and other relevant documents. Canada, our good neighbour to the north, is our largest e-commerce export trading partner. Now, as part of our exclusive Global Advantage program, duties and taxes on Canada`s World-Class International Service Plans (FCPIS) can now be prepaid at a low flat rate. . Goods and Services Tax (GST) and Value Added Tax (VAT) Stay up to date with the latest FedEx offers and learn how to make shipping and printing easier with timely email updates.
For European Union (EU) countries, this tax is called value added tax (VAT). Businesses subject to VAT and fully taxable do not bear the final costs of VAT, as it is a tax on consumption costs. . Delivered Duty Paid (DDP) is a shipping contract that transfers maximum liability to the seller. In addition to shipping costs, the seller is required to arrange import customs clearance, payment of taxes and import duties. The risk passes to the Buyer as soon as the goods have been made available to the Buyer at the port of destination. The buyer and seller must agree on all payment details and provide the name of the destination before completing the transaction. For U.S. importers, since the seller and its carrier control the transportation, the importer has limited supply chain information. A seller can also supplement their prices to cover the cost of liability for DDP freight or additional freight invoices. In some cases, freight bills have been increased from $3,000 to $7,000. Understand how handling fees are calculated and learn more about their role in the international shipping process.
To be considered a gift, the shipment must meet the following requirements: it is not always possible for the shipper to clear the goods abroad. Customs requirements for DDP shipments vary by country. In some countries, the customs clearance of imports is complicated and time-consuming, so it is preferable for the buyer, who knows the process intimately, to manage this process. . EU-specific VAT rates are available on the European Commission`s (EC) website on taxation and customs union. The declared value of a shipment represents the selling price or fair value of the contents of the shipment, even if it has not been sold. This value is shown on the FedEx Express® International shipping label as the total value for customs and must match the value on the commercial invoice. DDP was developed by the International Chamber of Commerce (ICC), which sought to standardize shipping worldwide; Therefore, DDP is most often used in international shipping transactions.
The advantages of DDP lean in favor of the buyer, as they assume less responsibility and less cost in the shipping process, which therefore imposes a heavy burden on the seller. Canadian prepaid duties and taxes make your business more attractive to savvy Canadian buyers. Here`s how it works:. If the RFP is poorly managed, incoming shipments are likely to be inspected by customs, resulting in delays. Late shipments can also occur because a seller may use cheaper and less reliable transportation services to reduce costs. RFP is used when utility costs are relatively stable and easy to predict. The seller is most at risk, so DDP is usually used by advanced providers. However, some experts believe that there are reasons why U.S. exporters and importers should not use the DDP. . Many countries have a general excise duty levied on the value added of goods and services. In some countries, such as Canada, Singapore, Australia and New Zealand, this tax is called the Goods and Services Tax or GST.
Proper valuation of all items in a shipment will help avoid delays in customs clearance, rejection or seizure by customs or fines. .