Who pays the duties and taxes?
The short answer is “the client school”.
The question “When do I pay the duties and taxes?” requires slightly longer to explain. Because then we get into the very complicated world of Incoterms. EquipMySchool can work with any Incoterms but the four most commonly used are discussed below.
Ex Works (EXW) – The pro forma invoice will include no export freight charges. EquipMySchool prepares the goods for collection and our client organises and pays a 3rd party for all transport, insurance, handling, duties and taxes to have the goods moved to their chosen destination.
Carriage, Insurance and Freight (CIF) – The pro forma invoice will include the cost of freighting the goods to a sea port local to the client. Insurance to that point is also included. The client will organise and pay a 3rd party to clear the goods through customs, insure the goods while in their country as well as settle the bill for duties and taxes.
Delivered at Place (DAP) – The pro forma invoice will include the cost of moving the goods all the way to our client’s delivery address, including the handling charges for clearing customs. This quotation will not include any duties or taxes, which will need to be paid to our clearing agent, directly by the client, before delivery can take place.
Delivered, Duty Paid (DDP) – In this most comprehensive scenario all freight and associated costs are included in the pro forma invoice from EquipMySchool. The client pays EquipMySchool for the international freight, insurance, customs clearance, handling, duties and taxes. It may still be necessary to communicate with the delivery agent however there should be no bill to settle with them directly. It is worth noting the quotation will be based on the facts available at that time. While EquipMySchool will do its utmost to honour the quotation, unforeseen circumstances when the goods arrive at destination could result in additional charges. If these are outside of the control of EquipMySchool we would require these to be settled by the client before delivery.
I hope you can see that under each of the four available services all of the exact same charges must be paid by the client school. Selecting a service will ensure that everyone knows who is responsible to pay for what and at what stage in the process.
EquipMySchool is equally happy to provide any of the above services. However, if the client school has a strong working relationship with a clearing agent local to them we recommend EquipMySchool provides a CIF service and the client pays that agent directly for the remaining services. This will keep costs to a minimum.