Is customs duty added to the cost of goods sold?
Asked 2 years ago
Does customs duty form part of COGS in Shopify? Or is that a separate expense?
Abeeha Qasmi
Sunday, December 12, 2021
Customs duty is not a part of COGS. It depends on the type of 'International Commerce Terms—incoterms' you are using from the following two types:
- Delivered Duty Paid—DDP: In this method, you—the seller, take responsibility for paying the customs fee. This amount is charged during the checkout or is included in the final pricing of your product.
- Delivered At Place—DAP/Delivered Duty Unpaid—DDU: The customer pays for the import fee for the shipment.
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