Duties and Taxes

Valuation

The most common valuation method is the transaction value method. This means that the value of the goods on the Commercial Invoice must equal the value that the purchaser has paid for the goods. For example, if a United States purchaser bought a computer from a Canadian merchant for $2,000, the vendor must indicate that value on the Commercial Invoice, even if the vendor’s own cost to purchase the computer was only $1,000.

Proper valuation of all items in a shipment will help prevent clearance delays, rejections or seizure by customs, or monetary penalties.

Declared Value for Customs and Duties and Taxes

Customs officials use a shipment's declared value (the value the shipper declares on the goods being shipped), along with the description of the goods, to determine duties and taxes. It is important to ensure that the declared value claimed is accurate. Inaccurate declared values are one of the most common reasons for duty and tax disputes.

A shipment's declared value represents the selling price or fair market value of the contents of the shipment, even if not sold. This value is identified on the FedEx Express^® International shipping label as the Total Value for Customs, and it must be consistent with the value shown on the Commercial Invoice.

Commodity Descriptions

One of the most common reasons for customs delays is an inaccurate or vague shipment description. A consistent and detailed description of the shipment contents on all documents can help reduce customs delays.

Temporary Imports

Many countries allow tax relief (either duties and tax exemption upon entry or a refund after exportation) for items that are temporarily imported or exported, as long as certain conditions are met and procedures are followed. For instance, items are often temporarily imported or exported for:

• Tradeshows
• Conventions
• Training
• Assembly
• Processing
• Re-export after resale
• Repair or replacement of damaged goods

Gift Exemption

Many countries allow gifts to enter duty-free if the value of the gift is less than a certain amount and if the gift being shipped is not considered to be a regulated or prohibited commodity. Any gift valued greater than the stated value may be subject to import duties and taxes.

Here are a couple of examples:

• The United States: No duties and taxes are assessed if the value of the goods is equal to or less than USD $100.
• Canada: No duties and taxes are assessed if the value of the gift is less than CAD $60.

To qualify as a gift, the shipment must meet the following requirements:

• The shipping documentation must be clearly marked "GIFT" and include a detailed description of the commodity.
• The total value of the shipment must not exceed the values listed in the above examples or other values set by the country.
  
• In some countries, the shipment must be sent person-to-person — with no company involvement or indication of involvement on the shipping documentation.
  

FedEx Advancement Fee

Duties, taxes and other charges might be due when importing a shipment. FedEx may advance these fees as assessed by customs on behalf of the payor. A fee will be based on the advanced amount.

Responsible Party

When completing the FedEx Express^® or FedEx Ground^® International shipping label, you can select the shipper, the recipient or a third party as the party responsible for payment of any duties and taxes. If no party is selected on the shipping label, the recipient will default as the responsible party.

Non-FedEx Account Holders

Prepayment of duties and taxes before release to the recipient may be required if the recipient does not have a valid FedEx account number or a FedEx account in good standing. Shipments will be held at the destination station until payment arrangements are made.

Please note: As per the contract of carriage with FedEx, the shipper is ultimately liable for any duties and taxes assessed on the shipment. If the recipient refuses the package, or the recipient or third-party FedEx account holder refuses to pay for duties and taxes, the original shipper will be billed for duties and taxes.