Calculate duty
Zonos Landed Cost processes hundreds of thousands of landed cost quotes per day. Duty rates are one of the most complicated components when calculating a total landed cost. Often, either a simplified duty is charged or duty is not charged at all on low-value imports.
We decode cross-border fees to create transparency in ecommerce. Transparency is important to ensure that an exporter can trust the calculations to accurately determine duties and taxes with the least amount of cost and effort, assess how much time and effort is needed to harmonize a catalog, and provide thier customers with a positive shopping experience.
Import duty calculations
Zonos will calculate duty with or without an Harmonized System (HS) code, however, an HS code can increase the accuracy of the calculation (and is required to receive a full landed cost calculation). Zonos' calculations include reduced rates, simplified rates, and the impact of de minimis values. As shown in the landed cost object, the duty rates are returned on a per-item basis with descriptions for the duty rates.
Landed cost
{
"id": "ldct_1Ce6vt2eZvKYlo2CrgzPqxaz",
"amount_subtotal": {
"duties": 9.85,
"fees": 21.0,
"taxes": 29.11
},
"duties": [
{
"amount": 7.5,
"description": "Duty",
"formula": "10%",
"item_id": "294395",
"note": null,
"type": "item"
},
{
"amount": 2.35,
"description": "Duty",
"formula": "10%",
"item_id": null,
"note": null,
"type": "shipping"
}
]
}
Duty de minimis
When the goods' combined value in a single shipment is below the duty de minimis (the value threshold that exempts imports from duty and/or tax), the item will clear without any duty collection; however, import tax may still be collected if the tax threshold is lower than the duty threshold. The opposite scenario is not possible because countries always set the duty threshold higher than the tax theshold.
The duty de minimis qualification is returned in the landed cost object. When the amount is below the de minimis threshold ("threshold": "below"), duties will not be applied to the import.
Landed cost
{
"id": "ldct_1Ce6vt2eZvKYlo2CrgzPqxaz",
"amount_subtotal": {
"duties": 0,
"fees": 21.0,
"taxes": 29.11
},
"de_minimis": [
{
"formula": "Less than 150 EUR",
"method": "cif",
"note": null,
"threshold": "below",
"type": "duty"
}
]
}
When a request is under the duty threshold in Checkout, Quoter, or Hello, the app will inform the shopper.
Landed cost
{
"de_minimis": [
{
"formula": "Less than 150 EUR",
"method": "cif",
"note": null,
"threshold": "below",
"type": "duty"
},
{
"formula": "Less than 22 EUR",
"method": "cifd",
"note": null,
"threshold": "above",
"type": "tax"
}
]
}
The method demonstrates the formula used for the duty calculation.
Calculation methods
| Method | Duty is applied to |
|---|---|
| CIF | Cost + insurance + freight: A method for calculating import taxes or duties where the tax is calculated on the cost of the order plus the cost of freight, and insurance. |
| FOB | Free on board: A method for calculating import taxes or duties where the fees are calculated only on the cost of the goods sold. FOB is not calculated on the shipping, duty, insurance, etc. |
| Other | Calculated on a per-unit basis or weight-based. |
HS codes
Whether a Harmonized System (HS) code is provided or not, Zonos will calculate duty, including reduced rates, simplified rates, and the impact of de minimis values. If you do not pass an HS code in the request, the default HS code set during account creation will be used for the calculation. Duty rates are returned on a per-item basis with descriptions for the duty rates as shown in the landed cost object.
All duty charges in the landed cost calculation are derived from an HS code. If the HS code is for the wrong country (e.g., An eight-digit HS code for Canada is provided on a request for a landed cost quote intended for Ireland), the code will be trimmed to the universal six digits for calculation. The response will contain a note indicating the code was trimmed due to a mismatch.
The landed cost object will contain the source of the HS code calculation: hs_code_source. There are five possible sources for an HS code that can be returned in the response. The zonos_catalog source will take precedence over any other source and will be used to match the appropriate duty rate of the item.
| HS code source | Description |
|---|---|
zonos_catalog PRIORITY | The item was entered in the Zonos Catalog with an HS code. |
api_request | The HS code was sent in the API request. |
platform | The HS code was passed from your ecommerce platform. |
zonos_classified | Item was classified by the Zonos Classify product. |
account_default | The HS code applied is the default HS code that is set up in your Dashboard account. |
Landed cost
{
"id": "ldct_1Ce6vt2eZvKYlo2CrgzPqxaz",
"customs": {
"amount_shipping": 25.0,
"delivery_duty_paid": "available",
"items": [
{
"id": "294395",
"amount": 75.0,
"country_of_origin": "FR",
"country_of_origin_source": "api_request",
"description_customs": "Footwear with outer soles of leather or composition leather",
"description_retail": "Hoka One Running Shoe - Women's",
"detail": null,
"dimensions": {
"height": 4.0,
"length": 6.0,
"unit": "inch",
"width": 11.0
},
"hs_code": "6404.20",
"hs_code_source": "account_default",
"image_url": "https://zonos.com/images/handbag.png",
"note": null,
"quantity": 1,
"upc_code": null,
"weight": 10.0,
"weight_unit": "pound"
},
{
"id": "294396",
"amount": 100.0,
"country_of_origin": "FR",
"country_of_origin_source": "platform",
"description_customs": "Footwear with outer soles of leather or composition leather - For Women",
"description_retail": "Hoka One Running Shoe - Men's",
"detail": null,
"dimensions": {
"height": 4.0,
"length": 6.0,
"unit": "inch",
"width": 11.0
},
"hs_code": "6404.20.20",
"hs_code_source": "platform",
"image_url": "https://zonos.com/images/handbag.png",
"note": null,
"quantity": 1,
"upc_code": null,
"weight": 10.0,
"weight_unit": "pound"
},
{
"id": "294397",
"amount": 125.0,
"country_of_origin": "FR",
"country_of_origin_source": "platform",
"description_customs": "Other footwear - With uppers of leather or composition leather",
"description_retail": "Hoka One Running Shoe - Children's",
"detail": null,
"dimensions": {
"height": 4.0,
"length": 6.0,
"unit": "inch",
"width": 11.0
},
"hs_code": "6405.10",
"hs_code_source": "api_request",
"image_url": "https://zonos.com/images/handbag.png",
"note": "hs_code_not_found Hs code trimmed to six digits due to a mismatch",
"quantity": 1,
"upc_code": null,
"weight": 10.0,
"weight_unit": "pound"
}
],
"ship_to_country": "FR"
}
}
Country of origin
A country of origin can impact the duty amount applied to an import due to trade agreements, laws, etc.
The country of origin can be set in the "items" array within the LANDED COST REQUEST API and requires a two-digit ISO code. See the ISO code reference sheet in our guides for a full list of 2-digit ISO codes.
Landed cost request
{
"items": [
{
"id": "294395",
"amount": 75.0,
"country_of_origin": "FR",
"description_customs": "Telephones for cellular networks or for other wireless networks:",
"description_retail": "Smartphone XL - 128 GB - Black",
"hs_code": "8517.12",
"quantity": 1
}
],
"shipping": {
"amount": 25.0,
"landed_cost": "delivery_duty_paid"
}
}
Catalog management
If you prefer, you can manage countries of origin and HS codes in Zonos Catalog. Catalog entries for products will take preference in determining the country of origin.
For example, if product id:
294395was added to your catalog withCAas the country of origin but a request was sent withFRas the country of origin, theCAcountry of origin would take precedence and be used for determining any possible duty rates for that item.
We'll calculate the preferential duty rate with a qualified country of origin. By default, other trade agreements are not enabled because many times smaller exporters don't have proper documentation and processes in place to receive the eligible reduced rate for all trade agreements. Additional trade agreements can be applied to your landed cost calculation upon request. To enable additional trade agreement preferences, contact us for assistance.
Tariff selection
Small, medium, and even large companies don’t have their products harmonized very often. If they do, the products are usually only harmonized to the sixth digit. Additionally, the items may not have a country of origin. The majority of duty and tax calculators are unable to calculate duty and tax without an eight-digit code and a country of origin. Landed Cost can calculate duty, even in cases where data is incomplete.
When only a six-digit HS code is available, the duty amount applied at the time of calculation uses a safety net by selecting the rate from the maximum dutiable HS code from the subset of country-level HS codes. This can be controlled at the API level by sending maximum, median, minimum, or zonos_preferred in the landed cost request. The selection of a median tariff allows for a cleaner calculation of specific duty rates instead of attempting to calculate the average. The median tariff is the middle tariff calculation in an ordered list. Below is an example of sending a median code in the rate request.
Landed cost request
{
"tariff_rate": "median"
}
Selecting an ad valorem tariff
An ad valorem rate is simply a percentage. Example of country-level ad valorem tariffs available if a six-digit code of 6109.90 is supplied:
| 6109.90 | Description | Duty tariff (ad valorem) |
|---|---|---|
| 6109.90.10 | T-shirt - Of man-made fibers | 32% MAXIMUM |
| 6109.90.15 | T-shirt - Of wool, with long sleeves | 5.6% |
| 6109.90.40 | T-shirt - Containing 70% or more silk | 2.6% MINIMUM |
| 6109.90.80 | T-shirt - Other | 16% MEDIAN |
In this example, by default, the maximum tariff 6109.90.10 would be used since it has the highest duty rate (32%). The landed cost object would return the six-digit HS code in items.hs_code and the duty percentage would be displayed in duties.formula.
Landed cost
{
"id": "ldct_1Ce6vt2eZvKYlo2CrgzPqxaz",
"customs": {
"amount_shipping": 20.0,
"delivery_duty_paid": "available",
"items": [
{
"id": "294395",
"amount": 75.0,
"country_of_origin": "FR",
"country_of_origin_source": "platform",
"description_customs": "T-shirt - Of man-made fibers",
"description_retail": "Stranger Things Women's T-shirt - Red",
"detail": null,
"dimensions": {
"height": 1.0,
"length": 1.0,
"unit": "inch",
"width": 1.0
},
"hs_code": "6109.90",
"hs_code_source": "Account default HS code",
"image_url": "https://zonos.com/images/handbag.png",
"note": null,
"quantity": 1,
"upc_code": null,
"weight": 1.0,
"weight_unit": "pound"
}
]
},
"duties": [
{
"amount": 24.0,
"description": "Duty",
"formula": "32%",
"item_id": "294395",
"note": null,
"type": "item"
}
]
}
Frequently asked questions
Do I need to harmonize my catalog to get a landed cost calculation?
No, a harmonized catalog is not required for calculating landed costs; however, it is recommended for more accurate calculations. If a harmonized code is not provided, the default HS code will be used, and a landed cost calculation will be provided.
Does Zonos offer catalog harmonization?
Zonos Classify offers on-demand HS code classifications, enabling you to harmonize your product catalog using advanced image recognition and country-specific HTS support.
Is there an interface or tool available to calculate import duty and taxes?
Zonos Quoter is available as a standalone application, so you can easily calculate duties and taxes without an integration. However, Landed Cost calculations are more accurate.
Is import duty applied to every order?
Not necessarily. It is very common for low-value shipments to be below the duty de minimis, which would indicate that duty is not applied to the import.
How many countries support sending a shipment Delivered Duty Paid (DDP)?
The ability to send a shipment DDP depends on the shipping carrier and the service level used. DDP is a loosely used term to describe the process of billing duties and taxes back to the retailer. Not all shipping carriers support DDP to all countries where Zonos calculates a landed cost. Each carrier's DDP coverage is in our international shipping carrier guides.
How is import duty calculated?
Import duty is calculated based on many factors including the destination country, the country of origin, the item HS code, possible de minimis thresholds, and other laws that affect the duty rate of an import. It's not always as straightforward as a single HS code tariff.
When the value of the good in a single import or shipment is below the duty de minimis, the item will clear without any duty collection; however, the tax may still be collected if the tax threshold is lower than the duty threshold. It's possible for the value of an item to exceed the tax threshold and not exceed the duty threshold. The opposite is not true, because countries don't set a lower threshold for duty and a higher threshold for tax.
Who pays import duty?
Duty is typically paid by the Importer of Record (IOR). The IOR is the owner or purchaser of products being imported to a country. The IOR is responsible for ensuring the imported goods comply with local laws and regulations, filing a completed duty entry and associated documents required by the CBP (Customs Border Protection), and paying the import duties and taxes.
The IOR is typically the person or entity who has ownership of the imported goods at the time of import.
In some instances, packages are shipped DDP. A retailer may want to send a package DDP if they have collected duties and taxes upfront from their customer, which can be done with Checkout or any of our Landed Cost products.
Import duty
Learn about import duty and how it is calculated.Import duty is a fee the customs authority collects upon imported goods' arrival into their country. The duty amount is calculated based on the value and classification of the goods and varies depending on the regulations, trade agreements, and duty de minimis of the importing country.