Question 1

What is the definition of import tax?

Accepted Answer

Import taxes are taxes placed on international purchases that vary by country, region, and HS code. Every country has a unique country-level tax rate and de minimis value.

Question 2

How do you calculate import tax?

Accepted Answer

The most common valuation method for taxes is CIF (Cost Insurance Freight), where taxes are applied to the value of the item, insurance, freight, duty, and fees. Other methods include CIFD, CIFDT, FOB, and FOBD.

Question 3

What does CIF, CIFD, CIFDT mean in international shipping?

Accepted Answer

These are valuation methods for calculating import taxes.  CIF = Cost + Insurance + Freight, CIFD = Cost + Insurance + Freight + Duty, and CIFDT = Cost + Insurance + Freight + Duty + Tax.  In other words, the CIF valuation method means that tax is calculated on cost, insurance and freight.

Question 4

What does FOB or FOBD mean in international shipping?

Accepted Answer

These are valuation methods for calculating import taxes.  FOB (stands for freight on board) = Cost of the goods, FOBD = Cost of the goods + Duty.  In other words, the FOB valuation method means that tax is calculated on only the cost of the goods sold, where FOBD also taxes the duty.

Question 5

Are import taxes applied to every order?

Accepted Answer

Not necessarily. It is very common for low-value shipments to be below the de minimis tax, and in that case tax is not applied to the import.

Question 6

Do I need to pay import taxes on items that are for resale?

Accepted Answer

Oftentimes when selling B2B, the importer will not have to pay import taxes if they are registered to pay taxes to their respective local government agency.  Taxes will be collected when the items are resold.  This is on a per country basis.  For example, two countries that allow tax free B2B imports are Canada and Australia.

Question 7

What if I don't have HS codes, but want them so I can get the most accurate duty and tax quotes?

Accepted Answer

Zonos Classify can be used for on-demand HS code classifications. Harmonize your product catalog with advanced image recognition, UPC code lookup and HTS country code support.

Question 8

How accurate are Zonos' import tax calculations?

Accepted Answer

The Zonos Global Trade Management (GTM) team does a monthly audit of our calculations that’s published with warts and all. We are dedicated to being transparent and accurate in our calculations.

Question 9

Does Zonos guarantee their duty and tax calculations?

Accepted Answer

We offer the Zonos Landed Cost Guarantee to provide peace of mind on every quote. With the Landed Cost Guarantee, the duties and taxes are billed to Zonos. If you are not signed up for the Landed Cost Guarantee and decide to pay the duty and tax directly to your carrier, then the quotes will not be guaranteed.

Question 10

Is there an interface available to calculate import duty and taxes?

Accepted Answer

Zonos Quoter is available so you can easily calculate duties and taxes with any integration.

Question 11

Do I need to register and obtain a tax number in foreign jurisdictions?

Accepted Answer

It depends. In most cases, you do not need to register for taxes in a foreign jurisdiction; however, if you exceed the annual thresholds on low-value shipments in New Zealand or Australia, you may need to register. You can also use the Zonos Landed Cost Guarantee, and we’ll take care of registration and payment for the duties and taxes to the proper jurisdiction.