Custom fees, duties and taxes (VAT) when shopping in the USA from Cyprus

A friend of mine lives on Cyprus. He was very impressed by my shopping in the USA and forwarding packages via Shipito, so asked me whether he could make purchases in the USA from Cyprus. Here is what I have found out.

Cyprus is a part of European Union (EU), so when you ship anything from the EU, you don't need to pay any customs fees or duties. Everything is different when you make purchases outside the EU. Goods from the USA, China,... are subject to duty.

CUSTOMS FEES and VAT in EUROPEAN UNION (EU)

MERCHANDISE+SHIPPING TOTAL	CUSTOMS FEES and VAT
< 22 EUR	No customs fees and No VAT
22 to 150 EUR	Only VAT applied
> 150 EUR	Both VAT and custom fees applied

If the merchandise plus shipping total is under 22 EUR, you do NOT need to pay any customs fee or VAT. But make sure that you take into account not only the amount you spend on your purchases, but also shipping costs.

If merchandise is between 22 and 150 EUR, you only have to pay VAT. The 150 EUR limit is calculated on merchandise value without any shipping fee. VAT however is paid instead on the total of merchandise plus shipping!

If merchandise is more expensive than 150 EUR, then you need to pay both customs fees and VAT. Both VAT and customs fee are applied to the merchandise plus shipping.

They will recalculate the price to Euro first using their own exchange rate table (at the day of the processing of the paperwork). Duty is paid at a percentage rate determined by the type of item. TARIC (Integrated Tariff of the European Communities) is designed to show the various rules applying to specific products when imported into the EU. TARIC for Cyprus can be found on the web-site of the goverment of Cyprus.

The VAT of 17% is calculated on the price of the item plus shipping and plus the duty charge.

Example:

Men's or boys' shirts of man-made fibres ($70 EUR) + $30 EUR for shipping.
Commodity code 6205 30 00 00



Duty 12%: 100 EUR * 12% = 12 EUR.
VAT 17%: (100 EUR + 12 EUR) * 17% = 19,04 EUR.
Duty + VAT: 12 EUR + 19.04 EUR = 31.04 EUR
Total: 100 EUR + 12 EUR + 19,04 EUR = 131,04 EUR

There may also be one or two other small charges depending on delivery method (for customs handling, courier handling).

Note that you can ask the seller to undervalue your package, but this is illegal. The customs official may request proof of price. You can get a big fine for undervaluing your package.

You can ship to Cyprus by USPS Mail or by courier services.

• United States Postal Service (USPS)
  The post office will deliver the customs form to your address/PO box. You will need to return the form to the post office along with an invoice for the goods. The post will then send the form and the invoice back to customs. Then the customs will process the paperwork, assess the duty and VAT payable, and release the package. Then the package will arrive in the post office and you will pay everything there. Note that you can go to the customs office yourself as well. And you will need to do that if your package costs more than 1000 EUR.
  


• DHL, UPS, TNT or FedEx.
  The courier should handle everything. You just pay the fees when the package is delivered or collected.
  

Note that customs will only do the assessment for private goods. If the goods are for commercial use, you'll need to to complete all the paperwork yourself, including TARIC codes, duty rates, etc.

Also note that if you are not a resident of Cyprus and plan to use your purchase outside the EU, you may try to return the VAT.