Customs and VAT in International Shipping — Complete 2026 Guide

Customs duty and VAT in international shipping are misunderstood by most people — both senders and recipients. The rules are simpler than they appear, but they differ significantly by destination country and goods value. This guide explains the complete framework, from the EU single market to the major international destinations.

1. EU internal shipments — no customs, no problem

Shipping between any two EU member states is treated as a domestic movement of goods — no customs declarations, no import duty, no VAT on the cross-border transaction itself. This applies to all 27 EU members: Germany, France, Poland, Spain, Italy, Netherlands, Belgium, Czech Republic, Slovakia, Hungary, and so on.

No action required from either sender or recipient in terms of customs — just the carrier label with correct addresses. Domestic VAT may apply on the sale of goods, but that is the seller’s concern, not shipping customs.

Note: Switzerland, Norway, and Iceland are not EU members despite being geographically in Europe. Shipments to these countries require customs declarations.

2. The EU de minimis system — €150 and €1 thresholds

For imports into the EU from non-EU countries, two thresholds apply:

Customs duty threshold: €150

Goods with a customs value below €150 are exempt from customs duty. This is the EU’s “de minimis” (Latin: below the threshold). Above €150, customs duty applies at the rate for the specific goods category.

VAT threshold: €1 (effectively no threshold)

Import VAT is due from the first euro of value. There is no minimum. A €5 book shipped from the USA to Germany will attract German VAT (19%).

Before July 2021, there was a €22 VAT exemption. The EU removed it — all imports are now VAT-liable regardless of value.

3. How import VAT is collected — IOSS explained

For e-commerce purchases (buying from an online shop), the EU introduced IOSS (Import One-Stop Shop):

• Online shops registered for IOSS collect EU VAT at the point of sale — you pay the final price including VAT on the shop’s checkout
• The shop remits the VAT to EU tax authorities monthly
• The parcel passes through customs without additional charges to the recipient — it is already VAT-paid
• The carrier’s label includes an IOSS number — customs can verify the VAT has been collected

This applies to B2C shipments (shop to individual consumer) for goods under €150. Above €150, IOSS does not apply and standard customs clearance occurs.

What this means for recipients: if you buy from a major international retailer (Amazon, Shein, AliExpress) that is IOSS-registered, your parcel arrives without additional charges. If you buy from a small retailer not registered for IOSS, expect a VAT bill from the carrier.

4. How import duty is calculated

When goods exceed the €150 de minimis threshold, customs duty is calculated as:

Customs value × duty rate = customs duty payable

“Customs value” is the declared value of the goods plus shipping and insurance costs (CIF value) for most EU countries. The duty rate depends on the HS code:

Check the exact rate for any goods at taric.ec.europa.eu using the HS code.

5. CN22 vs CN23 — which form to use

For all non-EU, non-UK shipments, a customs declaration form is required:

Write all content descriptions in English. Be specific: “cotton T-shirt” not “clothing”; “used Samsung smartphone, model Galaxy S21” not “phone”. Vague descriptions trigger manual customs inspection, which delays the parcel.

6. Country-specific rules — the major destinations

UK (post-Brexit)

VAT (20%) from £1. Duty-free up to £135. Above £135: customs duty + VAT. Gift exemption was removed in 2021 — declaring “gift” no longer reduces charges. See the full UK Brexit guide.

USA

The US de minimis (Section 321) is $800 — one of the world’s most generous. Shipments under $800 enter duty-free and without import tax. Above $800: US customs duty applies (0–17% depending on category). Note: the US is reviewing the Section 321 threshold — check current rules before shipping high-value goods. See the customs and VAT from USA guide.

Switzerland

Switzerland is not EU but has a customs union with Liechtenstein. VAT (8.1%) applies from CHF 62. Above CHF 300: Swiss customs duty also applies (CHF-based tariff, not EU tariff). Swiss customs is efficient — DHL and DPD typically clear in 1–2 days.

Norway

VOEC (VAT On E-Commerce) scheme: similar to EU IOSS. Online shops registered with Norwegian Tax Administration collect Norwegian VAT (25%) at checkout for goods up to NOK 3,000 (≈ €250). The recipient sees no additional charge. Above NOK 3,000 or for non-registered sellers: standard Norwegian customs applies.

Canada

De minimis CAD 20 for duty and tax — very low; almost all parcels attract Canadian GST/HST (5–15%) and potentially provincial sales tax. Above CAD 150: customs duty also applies.

Australia

GST (10%) applies from AUD 1,000. Below AUD 1,000: GST-free. Above AUD 1,000: customs duty and GST. However, Australia’s biosecurity rules are among the world’s strictest — any shipment may be inspected regardless of value. See the prohibited items guide.

7. Who actually pays — sender vs recipient

The party responsible for customs charges depends on the Incoterms agreed between sender and recipient:

• DAP (Delivered at Place) — most common for personal and small business shipments. The carrier delivers and then bills the recipient for customs charges before releasing the parcel.
• DDP (Delivered Duty Paid) — the sender or seller pays all customs charges in advance. The recipient receives the parcel with no additional payment. Used by major e-commerce retailers for a seamless buyer experience.

For private shipments (person to person), DAP is the norm — the recipient pays. For e-commerce businesses selling internationally, DDP or IOSS (for EU) is the professional standard.

8. Carrier customs handling fees

In addition to government customs duty and VAT, carriers typically charge a “customs handling fee” for their administrative work in clearing the parcel:

• DHL Express: typically €15–€20 per clearance event
• UPS: similar, €12–€18
• FedEx: similar, €12–€18
• National postal services: €5–€10 (lower, but slower clearance)

This fee is separate from and in addition to the customs duty and VAT. For low-value goods where the duty itself is small, the handling fee can exceed the actual duty — factor this into whether express carriers are worth the premium.

Summary

EU internal: no customs. Non-EU imports into EU: VAT from €1, duty from €150, both dependent on HS code and country. Always complete CN22/CN23 with accurate English descriptions and real values — never understate to avoid charges (it is illegal and voids insurance). For e-commerce, use IOSS (EU) or equivalent schemes. The USA has a generous $800 de minimis; the UK has £135 for duty (but VAT from £1); Switzerland has CHF 62. Carriers add their own handling fee on top of government charges.