Shipping Internationally: Customs, Duties and Paperwork for Small Businesses
Customs forms, HS codes, duty-paid versus duty-unpaid delivery and the 2025–2026 rule changes US sellers need to know before shipping abroad.
To ship internationally as a small business, complete an electronic customs declaration for every package with an accurate description, value, country of origin and 6-digit HS code. Then decide who pays import duties and taxes: the customer on delivery (DAP, often called duty-unpaid) or you at checkout (DDP, duty-paid). Check each destination's rules first.
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Selling internationally can grow an online store fast. Your products might be hard to find abroad, and a few well-placed orders from Canada, the UK or Europe can add up. But the first time a package gets stuck in customs, or a customer refuses delivery because of a surprise duty bill, international shipping starts to look like more trouble than it’s worth.
Most of those problems come down to 3 things: incomplete paperwork, the wrong product classification, and nobody telling the customer who pays import charges. Get those right and international orders become almost as routine as domestic ones.
This guide covers customs forms, HS codes, duty-paid versus duty-unpaid delivery, and recent rule changes US sellers need to know. Rules change often and vary by country, so treat this as a starting point and check official sources for each destination. This is not legal or tax advice.
How international shipping differs from domestic
When a package crosses a border, the destination country’s customs authority wants to know 3 things: what’s inside, what it’s worth and where it was made. Based on that, it decides whether the package can enter and how much duty and tax are owed.
That means every international package needs:
- A customs declaration describing the contents
- A tariff classification (HS code) for commercial goods
- A declared value that matches the real transaction value
- Country of origin for each item
- A plan for who pays duties and taxes
Some products also need permits or are banned outright in certain countries, such as some cosmetics, batteries, food items, plant and animal products, and anything regulated as a weapon. Check the carrier’s country-specific prohibited items list before you list a product for international sale.
Key takeaway: Customs delays and refused deliveries are mostly paperwork problems. Accurate descriptions, correct HS codes, honest values and a clear duty policy at checkout prevent most international shipping headaches.
Customs forms: what you need to fill out
You rarely need to fill out paper forms anymore. Shipping software, ecommerce platforms and carrier websites create electronic customs declarations as part of buying the label. The data you enter is sent ahead to the destination country.
What goes on a customs declaration:
| Field | What to enter | Common mistake |
|---|---|---|
| Description | Specific: “women’s cotton knit sweater” | Vague: “clothing,” “gift,” “sample” |
| Quantity | Units of each item | Leaving out items in the package |
| Value | Actual sale price per item, in USD | Undervaluing to save the customer duty |
| HS code | At least the 6-digit HS code per item | Guessing or using a code for a different material |
| Country of origin | Where the item was made, not shipped from | Listing the US for imported goods |
| Weight | Per item and total | Estimating instead of weighing |
| Contents type | Merchandise, gift, documents, sample, returned goods | Marking a sale as a “gift” |
Marking a sale as a gift or declaring a lower value to avoid duties is customs fraud in many countries. It can lead to seized packages, fines and an angry customer who gets an unexpected bill when customs revalues the item.
USPS now requires HS codes for commercial goods
USPS revised its International Mail Manual effective September 1, 2025, so senders of commercial goods must provide at least the 6-digit World Customs Organization Harmonized System code for each item in a mailpiece. Private carriers like UPS, FedEx and DHL have long asked for commercial invoices and tariff codes on business shipments. If you sell internationally, HS codes are now part of the job no matter which carrier you use.
When you need to file export information
For most small parcels, you won’t file anything with US export authorities. But Electronic Export Information (EEI) must generally be filed through the Automated Export System when the value of goods under a single Schedule B number exceeds $2,500 in a shipment, or when an export license is required, with some exceptions such as most shipments to Canada. Your shipping software or freight forwarder can help you file.
HS codes explained
The Harmonized System is a global product classification system maintained by the World Customs Organization. Countries use the first 6 digits the same way, then add more digits for their own tariff and statistics purposes.
- 6 digits: the international HS code, used worldwide
- 10 digits (US exports): the Schedule B number, used on US export filings
- 10 digits (US imports): the HTS code, used for US import duties
- 8–10 digits elsewhere: each country’s own tariff code
How to find the right code:
- Start with the official US tools: the Census Bureau’s Schedule B search for exports and the USITC Harmonized Tariff Schedule for imports.
- Classify by what the product is and what it’s made of, not by how you market it. A “yoga set” is classified as garments of a specific fiber.
- Save the code on each product in your ecommerce platform, so it flows into every label.
- For complex or high-volume products, get a classification opinion from a licensed customs broker.
Duty-paid vs duty-unpaid delivery
The biggest customer experience decision in international shipping is who pays import charges. These terms come from the International Chamber of Commerce’s Incoterms rules. Older guides call duty-unpaid “DDU,” a term replaced in current Incoterms by DAP (Delivered at Place).
| DAP (duty-unpaid) | DDP (duty-paid) | |
|---|---|---|
| Who pays duties and import taxes | Customer, on delivery | You, at checkout or through your carrier |
| Customer experience | Surprise bill, often with a carrier handling fee | Price shown is the final price |
| Risk of refused deliveries | Higher | Lower |
| Your admin | Lower | Higher: calculating duties, sometimes registering for tax |
| Return shipping risk | You may pay to get refused packages back | Lower |
| Best for | Low-value, occasional international orders | Regular sales to key countries |
Under DDP, the seller takes on import clearance and pays duties and import taxes such as VAT. In practice, small sellers usually do this through their carrier’s or platform’s duty-paid service, which collects estimated duties and taxes at checkout and pays them on your behalf.
Whichever model you choose, say it clearly on your shipping page and at checkout. “International customers may owe import duties and taxes on delivery” is the minimum. Our guide to writing a return policy covers how to handle refused international packages.
Key destination rules for US sellers
Thresholds and rules differ by country and change often. A few that affect many US small businesses:
- European Union. VAT applies to all imported goods regardless of value, and sellers can collect it at checkout through the EU’s Import One-Stop Shop (IOSS) for consignments of €150 or less. From July 1, 2026, the EU also applies a temporary flat €3 customs duty per item, based on tariff classification, on low-value B2C ecommerce consignments of €150 or less, replacing the old duty exemption. The temporary measure runs until July 1, 2028.
- United Kingdom. For consignments of £135 or less sold directly to customers in Great Britain, the seller generally charges UK VAT at the point of sale, which requires UK VAT registration. Above £135, import VAT and any duty are charged at import.
- Canada. Under CUSMA, Canada keeps a de minimis of at least CAD 150 for duties and CAD 40 for taxes on courier shipments from the US or Mexico. Postal shipments follow different, lower thresholds, so carrier choice matters.
The US also changed its own import rules. Low-value imports into the US no longer enter duty-free under de minimis, which affects sellers who source inventory from abroad. See how the end of de minimis affects small online sellers.
Pricing international shipping
International postage is usually much higher than domestic, and duties or taxes can add a significant share on top. Decide how you’ll handle the cost:
- Charge calculated rates at checkout based on weight and destination.
- Offer flat rates by region, such as Canada, Europe and rest of world.
- Set a higher free-shipping threshold for international orders, or exclude them. See how to offer free shipping without losing money.
- Show duties and taxes at checkout if you ship DDP.
Our guide to setting shipping rates explains how weight, size and zones affect cost.
Where to start: your first international orders in 8 steps
- Pick 1–3 countries where you see demand, such as Canada or the UK, rather than opening to the whole world.
- Check prohibited and restricted items for those countries with your carrier.
- Assign HS codes and country of origin to every product in your store.
- Choose your carrier and services for each country, comparing postal and courier options, including tracking and how duties are handled.
- Decide DAP or DDP and write it clearly on your shipping policy page.
- Set international shipping rates and any free-shipping rules.
- Test with a few orders and track how long customs clearance takes.
- Plan returns, since international returns are expensive. Consider refunds without return for low-value items, or local return addresses.
As volume grows, a fulfillment partner with international experience can handle paperwork and duty-paid shipping for you. See what is a 3PL.
Conclusion
International shipping isn’t complicated once the basics are in place. Accurate electronic customs declarations, correct 6-digit HS codes, honest values and a clear decision on who pays duties solve most problems before they happen. Start with a few countries, watch for rule changes like the EU’s 2026 low-value duty and new USPS data requirements, and expand as you learn. Look up unfamiliar shipping terms in our glossary.
This is not legal or tax advice.
Sources
- USPS Postal Bulletin: International Mail Manual revisions effective September 1, 2025 — 6-digit HS code requirement for commercial goods
- International Trade Administration: Filing export shipments through AES — EEI filing threshold of $2,500 per Schedule B number and license triggers
- European Commission Access2Markets: EU applies €3 customs duty per item on low-value e-commerce consignments — end of the €150 duty exemption and temporary €3 duty from July 1, 2026
- GOV.UK: Charging VAT on goods sold direct to customers in the UK — £135 point-of-sale VAT rule
- Canada Border Services Agency: Customs Notice 20-18 — CUSMA courier thresholds of CAD 150 for duties and CAD 40 for taxes
- ICC Academy: Incoterms 2020, DAP or DDP — responsibilities for import clearance, duties and taxes
Frequently asked questions
Do I need an HS code to ship internationally?
For commercial goods, yes. USPS has required at least a 6-digit HS code for each item in commercial international mail since September 1, 2025, and private carriers ask for tariff codes on business shipments too. You can look up codes with the Census Bureau's Schedule B search or the USITC Harmonized Tariff Schedule.
Who pays customs duties on international orders?
It depends on your shipping terms. With DAP, often called duty-unpaid, the customer pays duties and taxes on delivery. With DDP, or duty-paid, you collect them at checkout and pay them through your carrier or platform. Either way, state your policy clearly at checkout to avoid refused deliveries.
What is the difference between DDP and DDU?
DDP means delivered duty paid: the seller pays import duties and taxes. DDU meant delivered duty unpaid, so the buyer paid them. DDU is an older term that was replaced in current Incoterms by DAP, delivered at place, which works the same way for duties. Many carriers still use the DDU label.
Can I mark an international package as a gift to avoid duties?
No. Marking a sale as a gift or undervaluing goods to avoid duties is customs fraud in many countries. Customs can seize or revalue the package, and the customer may get a larger bill. Always declare the real contents, transaction value and contents type.
Do I need to file anything with US customs to export packages?
Usually not for small parcels. Electronic Export Information generally must be filed through the Automated Export System when goods under a single Schedule B number are worth more than $2,500, or when an export license is required. Most shipments to Canada are exempt unless licensed. This is not legal advice.
How much does it cost to ship internationally from the US?
Costs vary widely by carrier, package weight and size, destination and speed. Postal services are often cheaper for small, light parcels, while couriers are faster and handle duties more smoothly. Use your shipping software or carrier calculators to compare, and remember the customer may also owe duties and taxes.
What changed for shipping to the EU in 2026?
From July 1, 2026, the EU ended its customs duty exemption for low-value consignments and applies a temporary flat €3 duty per item, based on tariff classification, on B2C ecommerce consignments worth €150 or less. VAT already applied to all imports. The temporary duty is set to run until July 1, 2028.
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Manishdai
Manishdai writes about the technology that is reshaping every industry — from AI agents and cloud platforms to healthtech, fintech and the IT companies building it all across the United States.
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