CUSTOM DUTY

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Who Pays For Customs Fees?

When a package ships internationally, it may be subject to import taxes, customs duties, and/or fees imposed (e.g. handling fees) by the destination country. These charges are typically due once the package arrives in the destination country.

In general, the buyer is responsible for paying the additional costs such as duties, taxes, and customs clearance fees. These charges can vary widely and are often based on the price and type of item, package weight and dimensions, origin country, and the taxes, duties, and fees of the destination country.

The inside stories can’t predict which of these fees, if any, will be applied, and Etsy doesn’t expect sellers to calculate or collect these fees or taxes.

The inside stories isn’t responsible for any additional charges that may apply after a purchase is completed.

How do I pay customs fees?

If your package is subject to customs fees, your package may be held at your local customs office. Contact your local customs office to find out your next steps as you may need to pay additional charges. 

Custom Duties and VAT

When a package ships internationally, it may be subject to import taxes, customs duties, and/or fees imposed by the destination country. These charges are typically due once the package arrives in the destination country. 

Sellers are responsible for complying with the laws and regulations of the country of destination. Generally, the buyer is responsible for paying customs duties on receipt of the package.

Certain countries may require certain documentation before the items are sent. If the necessary information is not provided, this may result in delays in the order.

Learn more about custom fees:

United States of America

Goods purchased from the US shipping overseas

Sellers in the US that are shipping overseas can enter their package information on the USPS website to determine which customs form is necessary.

Goods arriving into the US

When goods are shipped into the US, the buyer (“Importer”) is responsible for any fees/taxes/duty that may accrue on the merchandise when it clears Customs and Border Protection (“CBP”).

If any duty is owed, CBP will charge a processing fee for clearing the package. Duty and the processing fee are due at the local post office of the Buyer, where the package has been forwarded.

 

Good arriving into certain US states

The inside stories will calculate, collect, and remit sales tax for orders shipped to customers in US states that require it, no matter the location of the seller.

Australia

The inside stories collects and remits GST on certain orders shipped into Australia. Learn more about GST on Etsy.

The inside stories will automatically collect and remit the tax from Australian buyers where the goods are less than or equal to AUD$1,000. Sellers may need to include additional information on the customs form depending on the shipping method.

Canada

The Canada Revenue Agency’s web content was successfully migrated to Canada.ca in July 2017. CRA is the theme lead for Taxes on Canada.ca. The majority of the CRA’s content is found under the Taxes theme. The remaining content can be found on:

Please visit the new Canada Revenue Agency section on Canada.ca. 

European Union

Goods shipping between EU countries

Customs duty is not applied on goods sold within the EU. However, VAT may still be applicable and should be included in the purchase price at the time of sale. Since Etsy requires sellers to list their prices inclusive of VAT, the buyer shouldn’t have to pay any additional amounts other than the total price displayed at checkout.

As of January 1, 2021, the EU doesn’t include the United Kingdom.

Goods arriving into EU from non-EU country

When shipping goods from a non-EU country into an EU country, customs fees and VAT may apply on these goods.

From 1 July 2021

The inside stories will collect VAT on certain physical goods sold to EU buyers that are imported into thee EU. The inside stories will automatically collect and remit the tax from EU buyers where the value of the imported physical goods are less than or equal to €150.

Each EU country sets their own VAT rate. The VAT rate is between 17 and 25% for most goods, however some goods are tax-exempt or taxed at lower rates. Learn more about VAT rate per EU country.

Learn how VAT works on digital items sold to EU buyers.

Buyers will see estimated VAT when they view items in search, browse, and the listing page. They’ll also see estimated VAT when they add the item to the cart. The final VAT will be calculated at checkout.

Before 1 July 2021

The amount of customs duty and VAT to be paid will be assessed at the point of entry of the destination country. This may result in the buyer having to pay additional charges which are not included in the total price displayed at checkout.

Generally, VAT isn’t due when the total value of all goods in a consignment (value not inclusive of custom duties or transport costs) is less than the destination country threshold. The threshold may vary from €10 euro to €22 euro, depending on the EU country.

For VAT, the rate that is assessed is the rate set by the country that the package is shipped to. 

Customs duty does not typically apply on goods where the value doesn’t exceed €150 euro.

Learn more about buying goods from non- EU countries.

New Zealand

New Zealand requires The inside stories to collect goods and services tax (GST) on all goods sold to New Zealand buyers from overseas. The inside stories collects and remits the tax on applicable orders shipped into New Zealand. The GST rate is 15%.

Information for sellers

For orders shipping into New Zealand from overseas, sellers must include the following information on the outside of their packages and on the customs slip:

  • The inside stories Inland Revenue Department (IRD) number 122-669-181.
  • Indication that GST has been applied.

If the seller does not meet these requirements, the buyer may be charged GST again at the time of delivery. Sellers should also include this additional information to the customs forms on these packages. If a seller fails to include this information, the buyers may be charged GST at the border and additional handling fees. The inside stories will only be able to refund the GST to the buyer on proof of payment of such additional fees.

GST does not apply if the transaction is between buyers and sellers both located in New Zealand.

Learn more about GST in New Zealand.

United Kingdom

The inside stories collects VAT on the sale of digital items delivered via automatic download to buyers in the UK. Learn more about VAT on digital items. 

As of January 1, 2021, The inside stories collects VAT from buyers on orders that meet the following criteria:

  • The purchase is for a physical item. 
  • The buyer is located in the UK.
  • The total value of the package (including gift wrap but excluding delivery) is less than or equal to £135.
  • The goods are dispatched from outside the UK.*

*The inside stories is not obligated to collect VAT on shipments from the EU to Northern Ireland, or on shipments from Northern Ireland to other parts of the UK. Learn more.

VAT is applied to the full order total, which includes item price, shipping, and gift wrap charges. 

How VAT appears at checkout

Buyers will see estimated VAT when they view items in search, browse, and the listing page. They’ll also see estimated VAT when they add the item to the cart. The final VAT will be calculated at checkout. 

 

Rest of the world

Other countries may also apply customs duty and/or VAT on goods purchased from another country. The amount of customs duty and VAT to be paid will be assessed at the point of entry of the destination country. This may result in the buyer having to pay additional charges which are not included in the total price displayed at checkout.

As the threshold for the application of such charges may vary from country to country, please contact your local customs/ tax office for further information. Alternatively, you should check with your local tax advisor for more information.

The inside stories is not responsible for the collection or determination of any custom duties or VAT costs.

Learn more on country-specific tax authorities websites:

Where can I find customs forms? 

You can obtain customs declaration forms from your mail provider. Most of the time, these are available online.

 

Disclaimer: This article does not constitute legal or tax advice and is for information purposes only. You should consult with a professional advisor if you have any additional queries.