Customs Duties and Import VAT: Anticipating the Real Cost of Your Import
Calculating Customs Duties and Import VAT: The Complete Method
To anticipate the real cost of an import, it's essential to know how to calculate customs duties and import VAT. This should be anticipated as early as the quotation stage.
How customs duties are calculated
First, customs duties are calculated by applying a rate to the customs value of the goods. This rate is defined by the product's HS code. The customs value generally corresponds to the CIF price, meaning the cost of the goods plus insurance and freight up to the European Union border. The rate applied varies significantly depending on the product category, ranging from 0% for certain goods to over 12% for others.
How import VAT is calculated
Next, import VAT is applied to the customs value. It is increased by the customs duties already calculated. Incidental costs, such as transport and handling, are also added. It is due at the rate in effect in the destination country, i.e. 20% in France for most products, with reduced rates for certain specific categories.
Preferential rates depending on origin
In addition, certain products benefit from preferential customs duty rates. Full exemptions even exist in some cases, due to trade agreements in effect between the European Union and the country of origin of the goods. Checking these agreements before ordering can therefore represent a significant saving on the final cost.
A limited impact on cash flow
However, for a company that imports regularly, import VAT is generally fully deductible. Even better, it can be self-assessed (reverse charged) directly on the VAT return, meaning the company avoids having to advance the sum at the time of customs clearance. This helps preserve the company's cash flow.
Anticipating these costs in margin calculations
Ultimately, precisely factoring in customs duties and VAT from the initial quotation stage helps avoid unpleasant surprises, as it also helps secure the real margin on each imported product.
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China sourcing agent & buying office
MOZAIIK IMPORT is far more than a China sourcing agent: we are your buying office and
sourcing bureau, your trusted French-speaking partner on the ground, dedicated to securing and optimising all your imports.
For several years, we have been supporting French and African companies of all sizes from SMEs to industrial players in finding reliable suppliers, negotiating, controlling quality, and managing the transport and customs clearance of their goods.Recognised field expertise
Being present in China makes a real difference. Thanks to our local presence, we can verify factories, monitor production, anticipate problems and provide you with clear reports at every stage. This proximity allows us to guarantee reliable and secure purchasing which is often the most critical point for companies looking to import from China.
A comprehensive service offering
As a buying office and sourcing company in China, we offer complete and personalised support:
• Technical studies in product development
• Reliable supplier sourcing: identifying and selecting factories suited to your needs, price negotiation and order securing
• Quality control and production monitoring: regular inspections and audits to ensure your products meet your requirements and standards
• Logistics and transport: sea, air or express freight, with transparent tracking and optimised cost management
• Customs clearance and final delivery: customs formalities fully managed through to your warehouse or point of sale
Our role is to simplify importing, reduce risks and allow you to focus on your market and the development of your business.
Why choose us?
