Duties & Taxes at Checkout (DDU vs DDP)

All shipments created through Easyship are commercial shipments. This means that shipments crossing international borders can be subject to duties and various taxes depending on the import regulations of the destination country. In this article, we will discuss who is responsible for paying these import fees and how you can display them to your customers before they place their order. 

What We'll Cover

Who Pays Duties and Taxes?

You can choose who will be responsible for paying duties and taxes at the time your shipment is created. 

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Shipping pre-paid is referred to as DDU (delivery duty unpaid) which means that the receiver/customer will get contacted by customs once their shipment arrives and will have to settle any charges in order for customs to release the shipment and have it delivered to the customer.

Shipping post-paid is referred to as DDP (delivered duty paid) which means the sender is responsible for paying the duties. In many eCommerce cases, the seller includes these duties at checkout and directly collects payment from the customer for DDP shipping.

Note that as not all couriers offer prepaid services if you choose to pre-pay duties and taxes you will only be shown the couriers that can accommodate this request. 

You can choose to be transparent with your customers and display the Duties and Taxes at checkout. This is a great way to build trust with your international customers. 

Duties and Taxes at Checkout

If you're shipping internationally, we advise against having a static checkout like the example below:

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If your shipment is above the tax threshold, showing the above shipping rates could be very misleading, as your customers would not be aware of the additional taxes and duties they'd be responsible for.

Your customer will see tax & duty information differently, depending on whether you've chosen to deliver your shipments post-paid (to be paid at the door) or pre-paid (Included in the shipping cost).

If you would like to understand the various taxes & duties rules for countries you can ship to from Easyship, search through our shipping destination guide.

For shipments BELOW the tax threshold:

Regardless of whether you've chosen the pre-paid or post-paid tax option, this is what your checkout will look like if there are no taxes or duties to be paid:

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For shipments ABOVE the tax threshold, with taxes PRE-PAID:

If you've chosen pre-paid (included in the shipping cost) and the order meets the destination country's tax threshold, and you want to show your taxes at checkout, it will look like this:

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 For shipments ABOVE the tax threshold, with taxes POST-PAID:

Like the above example, these orders qualify for duties & taxes, but the fully landed costs are estimates and will be due upon arrival. 

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DDP Handling Fees

If you choose to ship your orders with prepaid Duties and Taxes, the couriers will charge you an additional fee for paying the import fees on your behalf when the shipment arrives at the destination country.

In addition to the fixed 'DDP Handling Fee' for taking care of those duties and taxes, you can also expect a 'disbursement fee', calculated as a percentage of the amount of duties & taxes they will advance on your behalf. These charges can appear subsequently and should not be underestimated.

Despite the complex pricing, DDP shipments do bring you the peace of mind that your shipment will not be returned or abandoned simply because the recipient refuses to pay the import fees. 

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