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International Trading: Customs Duty Best Practices

How Much Will My Buyer Have to Pay In Duties?

Duties depend on how the item is classified by Customs and this can be a very complex procedure. If the buyer really wants to find out, their best option is to contact Customs in their own country. It’s a good idea to put this info in your FAQ.

We don’t recommend that you give them an estimate of how much it might be as they may simply come back angry if you turn out to be wrong!

More to the point: Does your buyer even realize that Customs duties may apply?

Because there is no way of judging exactly how much the buyer may have to pay in duties – or even if they will have to pay them at all – you need to state very clearly on your auction that duties are a possibility.. And when we say clearly, we mean clearly! As in:

The BUYER is responsible for all taxes & import duties.

This might seem like overkill, but if you don’t go to these lengths, you’ll almost certainly have surprised (and quite possibly infuriated) buyers on your hands who didn’t notice the statement in your description.

Should I mark the item as a gift to avoid duty?

No. Marking commercial items as gifts is illegal. And while that’s not to say that plenty of eBay and other sellers don’t practice this widely, it’s possible that this is simply because they are not aware of the penalties if they are caught doing so.

If your buyer pushes the point, just direct them to the appropriate ‘Internet Shopping’ link for the Customs website in their country, which will probably say something like this:

Although you, the seller, completed the Customs form, it is the buyer who is the importer. As such, it is the buyer that is responsible for insuring that what they purchase complies with import regulations…And it is the buyer who will be liable for financial penalties or criminal prosecution if an item is falsely declared as a gift!

Don’t lie about value

Another old trick sellers sometimes use to avoid duty is to underestimate the value of the item on the declaration form. Some even go to the length of including a receipt stating the item is on sale to explain the incredibly low value! But…there is a catch. If you have asked the buyer to purchase insurance to cover the item’s full value, and the item goes missing, your shipper is only obliged to cover the declared value on the form!

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1 Comments Add your comment
I really do not understand why some countries charge IVA or Taxes to international sales. The European Union Importation Law reads clearly that for an item to be classified as "commercial" the buyer must be a registered business entity associated or individual. So, if your client buys from you overseas, what difference does it make if you marked "gift". I always mark "other" and describe the item as you have to do in the custom form. When you mark "other" is not longer your responsibility if the custom of the respective country wants to charge any duties. I advise all international sellers to mark "other", describe the item clearly and include all receipts from PayPal and Ebay, this is to demonstrate that the buyer bought the item or items "out" of the respective legal markets. Reply
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