Selling abroad: VAT, duties & import tax basics
The moment you ship across a border, a second country's tax system attaches to your order, and getting it wrong means surprise fees at customs, held parcels, or a customer hit with a bill they never agreed to.
AI can map the moving parts for your exact lanes and draft the setup; rules differ by country and change often, so confirm with an accountant qualified in your jurisdiction.
Fastest path: one prompt, end to end
🤖 AI prompt — paste into ChatGPT / Claude
You are a cross-border ecommerce tax advisor. You are NOT my accountant; flag anything that needs a professional and never state a rate, threshold, or deadline as fact.
Where I'm based (seller country): [your country]
Countries I sell into (buyer countries): [countries you sell into]
Platform/marketplace: [Shopify / Amazon / etc] Product type: [category] Typical order value: [amount]
Do this:
1. For each buyer country, explain in plain language: whether I likely owe VAT/GST or import tax, whether it is collected at checkout or at the border, and who is usually liable (me as the merchant vs the marketplace).
2. List the moving parts I must check per lane: VAT/GST registration thresholds, low-value import schemes (IOSS-style one-stop registrations), and de-minimis thresholds below which duty or tax may not apply.
3. Use your browser to open each buyer country's official tax and customs site and read the CURRENT rules; cite the page. If you cannot browse, say so and leave that lane blank for me to confirm.
4. Mark clearly which items I must confirm with a qualified accountant vs handle myself.
Do not guess or estimate any number. Rules differ by country and change often; tell me to confirm each figure with an official source or an accountant qualified in my jurisdiction.
Output: a per-lane table (owe? / collected where? / who is liable / thresholds to verify) plus a get-a-pro list.
Or do it in 4 steps
- Separate seller-country tax from buyer-country tax. Your home country taxes your business; the buyer's country may charge VAT/GST and duty on the goods entering it. They are two different questions, so answer them one lane at a time (US seller entering the EU, or a China seller entering the US and EU, all follow the same split).
- Find out who collects. On many marketplaces the platform collects and remits import VAT/GST for you; on your own store you may be the one liable. Confirm this per channel, because it decides whether you charge tax at checkout or the courier bills the customer at delivery.
- Check thresholds and low-value schemes per lane. Most countries have a VAT/GST registration threshold, a de-minimis value under which import charges may not apply, and often a low-value import scheme (IOSS-style) that lets you collect tax at checkout so parcels clear cleanly. These numbers vary and change, so read them from the official source, never from memory.
- Decide DDP vs DDU, then get a pro before you scale a lane. Delivered-Duty-Paid means you collect and cover the import charges (smoother for the buyer); DDU leaves the customer to pay on arrival (cheaper for you, worse experience). Once a lane has real volume, have an accountant confirm registration and the collection setup.
Worked example (labeled): a store starts shipping to a new country under DDU, assuming duty is the buyer's problem. Customers hit unexpected customs bills, refuse parcels, and leave one-star reviews; the returned goods eat the margin.
Had the seller checked that lane's de-minimis and a low-value import scheme, enabled checkout collection, and shipped DDP, the tax would have been a line on the invoice instead of a customer ambush. Set the lane up before you promote it.
Pair this with the landed cost note (so the tax and duty land in your price math, not your margin) and the international shipping note under Operations (for the logistics and courier side).
Rules differ by country and change often; confirm every rate, threshold, and scheme with a current official source or an accountant qualified in your jurisdiction. Re-check each lane whenever you enter a new country or cross a sales milestone.