When shipping to another country, duties, and taxes may apply to your shipment. The shipment recipient is generally responsible for paying any duties or taxes. However, there may be instances where you, as the merchant, will want to cover the cost of duties and taxes.
When a merchant pays, it is called Delivered Duty Paid or DDP.
Within PayPal Shipping Center, the setting you use for DDP is Prepay Duties and Taxes.
There are a few things to know about DDP:
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The merchant is responsible for all the costs associated with shipping.
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Not all carriers provide this option, but many do.
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You should explicitly convey to your customers that you mark up your prices to cover duties and other fees.
DDP is convenient for your customers because it removes the burden of paying another fee before receiving their shipment. They just have to wait for their shipment to arrive. It is especially appealing if the merchant absorbs all the costs.
Usually, the advantage for the merchant can come from having a steady, reliable market in a certain place. This will reduce risk if you know you can reliably send shipments to the destination country.
The option to bill duties to the payor is only available when shipping with certain carriers.
If a carrier supports DDP, the option to use it will appear in PayPal Shipping Center in the Customs Form section.
Shipments from the US to Canada sent via USPS First-Class Mail International, Priority Mail International, and Priority Mail Express International are eligible for DDP.
Prepaid Duties to Canada Limitations
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For shipments to Canada using the Delivered Duty Paid (DDP) option, the maximum value cannot exceed $400. The prepaid duties option is only available for shipments valued at $400 or less.
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The prepaid duties option is available only for packages that weigh 4 lbs or less.
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The prepaid duties option is not supported for Priority Mail International Medium Flat Rate Box and Large Flat Rate Box shipments, as these package types are not eligible for DDP.
Use the Duties/Taxes drop-down menu in the Configure Shipment Widget and select the option to Prepay Duties and Taxes. You will be charged a flat fee for any cross-border duties or taxes that will apply to the shipment, depending on the shipping service:
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First-Class Mail International fee: $9.95
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Priority Mail International and Priority Mail Express International fees: $9.95
Some Priority Mail International Package Types are Not Eligible for DDP
Priority Mail International Medium Flat Rate Box and Large Flat Rate Box shipments are not eligible for DDP.
Shipments sent from the US to Canada using USPS international services are eligible for DDP, but you must specify DDP with the Prepay Duties and Taxes option in PayPal Shipping Center.
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Open an eligible international order.
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Click the Duties/Taxes drop down in the Custom Form section.
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Select either Prepay Duties and Taxes or Recipient Pays Duties and Taxes.
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Fill out the remaining shipment details and purchase the label.