DUTY & TAX/VAT

UNDERSTANDING THE FUNDAMENTALS

What & how are Duties Calculated?

Whether a shipment is a gift or not, it must still go through an import procedure as determined by custom’s law in the destination country. The shipment is declared through customs based on a number of elements such as- origin country, the value and quantity, but not its purpose. Dutiable shipments are subject to a customs duty, which is a tariff or Tax/VAT imposed on goods when transported across international borders.

The calculation of duties depends on the assessable value of a dutiable shipment. For the purpose of this calculation, dutiable goods are given a classification code that is known as the Harmonized System code (This system has been assigned by the World Customs Organization and continues to evolve.)

Tax/VAT Across Borders

Government Tax/VAT are imposed on goods which are moved across a political boundary (although some free trade zones exist around the world). Tax/VAT are usually associated with protectionism, the economic policy of restraining trade between nations.

Who is Responsible for Payment of assessed Duty & Tax/VAT?

The payment of duties and Tax/VAT are typically the responsibility of the receiver, although DHL Express does offer the opportunity for DHL account holders to pay for them post clearance on behalf of the Receiver.

In that case, after shipment delivery, DHL invoices Account customers for the duties and Tax/VAT we paid on their behalf at destination, plus a small administration fee.

Goods Purchased Online for Personal Use

You may be charged customs duties and Tax/VAT for something purchased online because:

  • Duties and Tax/VAT are typically not included in the price of the goods you purchase online, and might not be included in the overall shipping costs you pay to the online retailer; unless specifically noted by the online retailer site during check out process.
  • When purchasing goods online, some or all of these goods may not originate in the country you reside in, therefore are subject to a customs duty, which is a tariff or Tax/VAT imposed on goods when transported across international borders.
  • When goods are not shipped domestically (within your country) or within a single customs union, such as the European Union, you are liable to pay any inbound duties and Tax/VAT which your local customs authority deems appropriate.
  • To ensure the DHL courier can deliver your goods in shortest possible time after entering your country or customs union, DHL pays the customs authority on your behalf for any duties and Tax/VAT that are due on the goods.
  • Once the duties and Tax/VAT are fully repaid to DHL the goods will be delivered to you
  • What is payable, if anything, depends on where the goods are sent from, the type of goods, their transactional value and the weight of the package

When buying goods online, you should always check whether they are either being sent to your address from:

  • Your country
  • Another country
  • Outside your customs union country

Note: Different rules apply when buying goods for commercial use.

Gifts Bought Online

A gift is defined, as something sent directly by one private individual to another and such goods do not attract import Tax/VAT if the value is below stated local thresholds.

Ordering and paying for goods that originate outside of your country or customs territory for shipping to a person other than the purchaser, does not satisfy the customs definition of being a gift.

Duty & Tax/VAT Quick FAQ

I was charged duties and Tax/VAT by customs for something purchased online.
Why wasn’t that included as part of the overall shipping costs?

  • Duties and Tax/VAT are most typically not included in the price of the goods you purchase online.
  • When purchasing goods online, some or all of these goods may not originate in the country you reside in.
  • When goods are not shipped domestically (within your country) or within a single customs union, such as the European Union, you are liable to pay any inbound duties and Tax/VAT, which the local customs authority deems, appropriate.
  • To ensure the DHL courier can deliver your goods in shortest possible transit time, when we enter your country, DHL pays the customs authority immediately on your behalf for any duties and Tax/VAT that are due on the goods.
  • DHL only releases the goods to you upon the full repayment of any duties and Tax/VAT that were paid on your behalf.

Why do I need to pay customs duty?

Although you ordered and purchased the goods online, the goods are still subject to an import procedure to clear the shipment through customs. Clearance depends on:

  • The country of origin
  • The value including transport charges
  • The quantity of goods
  • Each country has its own customs laws and the duties for different types of goods and values are set locally. DHL, like any other international transportation company, must adhere to local customs legislation and so DHL pays duties on the receiver’s behalf to clear shipments on arrival.

When making my purchase it stated the price includes shipping costs.
Why was I asked by DHL to pay additional charges to have my package delivered?

You will not be paying to DHL any further shipping costs. Rather, you will be asked instead to pay customs duties, Tax/VAT and other import charges related to customs clearance in your home country, as per local regulations.

Why do I need to pay customs duty if I received a shipment as a gift?

Whether a shipment is a gift or not, it must still go through an import procedure as determined by custom’s law in the destination country. The shipment is cleared through customs based on the origin country, the value and quantity, but not its purpose. You will need to pay customs duty and Tax/VAT only if the value of the gift is above a stated local threshold.

Why am I restricted with value and quantity if I am ordering for my personal use?

Every country has limitations for imported goods, which are used for personal use. This is to avoid misuse, and to distinguish imports for personal and commercial use.

What additional charges can I expect following customs clearance?

Depending on value and the type of goods imported, you may expect the following:

  • Customs import duties (percentage of shipment value and transport charges)
  • Local Tax/VAT
  • DHL Advance Payment surcharge
  • Any regulatory charges, if applicable