Customs Tax – Selling abroad, two things you need to know — Start or Improve Your Online Business

Selling Abroad – Two Things You Need to Know About Tax

by Hannah Jones on November 29, 2012

Customs tax selling abroadSelling online is getting more difficult for many of us. Big brands are pushing prices down on eBay, and as the cost of living rises I’ve spoken to many online sellers who aren’t feeling as profitable as they were a year ago.

In the past, I advised online sellers that selling internationally was advisable; now I say it’s a must. To keep your income high and rising, you need to be selling to as many people as you can – that means opening your doors to the thousands of people who shop online internationally.

One of the big questions people have about selling internationally is about tax. You want your products to reach your customers, without you getting a hefty fine or a slap on the wrists, right? Well here are the two things you need to know.

1. Most countries charge import tax on any goods brought into the country through trade.

This means everything, other than gifts, is subject to import fines. That’s why the customs form you have to fill in asks whether it’s a gift or purchased item. If you put gift, it is unlikely to get stopped; but if you say it’s a purchased item, they might decide to charge tax for importing it.

If the item is subject to tax, it will be held by the customs authorities in the country it is sent to, until the customer pays the import tax. Import tax is usually calculated as a percentage of the market price of the product in the country it’s sent to

2. You do not have to pay import tax.

As long as you’re clear from the start, you are under no obligation to pay import tax – that’s for your customers to deal with. Just be sure to make it clear where you stand, or you’re sure to get some unhappy customers demanding refunds or reimbursements for taxes.

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Hannah Jones
Hannah set up her business selling children’s toys on eBay. Now she’s on a mission to help others to experience the freedom of selling online. Check out her eBooks for advice on setting up or improving your online business. Connect with Hannah on Twitter or Google+
Hannah Jones
Hannah Jones

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