Import is a term used for the purchase of products and services from abroad. Read about importing from the USA and China and learn about the differences between importing from the EU and outside the EU.
What is import?
Import is an expression of goods and services purchased from abroad.
For example, almost all cars in Denmark are imported. In Denmark, most companies import from EU countries, especially Germany, which is one of the countries we import the most from.
Import is a term used in both micro and macroeconomics.
When a company buys goods from abroad, the term is used to describe the special trade relationship between the two companies.
The term is also used in macroeconomics to describe the trade activities that enter the country.
Import within the EU
When trading within the EU, there is no import or export of goods, but rather the delivery of goods.
However, the term import is still used in everyday language, and we will also use it here.
In addition, no customs duties are payable on imports from EU countries, but rather VAT and any excise duties.
You can easily and quickly import your goods from the EU through Shipmondo.
Get a complete overview of countries and your options here.
You can also create a free Shipmondo account and get started right away.
Excise duties on imports
Excise duties are a series of special taxes, also called indirect taxes, which are ascribed to items such as packaging, chocolate, spirits, and games.
There are also duties on electricity and oil, known as environmental and energy taxes.
Excise duties must be paid when the goods are imported into the EU.
It is either the company acting as an approved warehouse keeper, the person issuing the security, or the person importing the goods who must pay the excise duty.
The excise duty must be paid before the goods are consumed, which is why it is not always the manufacturer who is responsible for the payment.
VAT on imports
You must report your VAT when you buy goods from abroad.
You must therefore calculate 25% VAT on the purchase and record it as sales VAT.
If your company is VAT registered, the VAT can be zero as the calculated VAT is included as purchase VAT.
You must also provide security for the customs duties that your goods may be subject to.
When you have to pay customs duties on your imported goods, you can calculate the amount based on the customs value of the goods, which is the total cost you have incurred to get the goods to the EU external border, including price and expenses for freight and insurance.
The origin must also be stated in the import declaration - that is, where the goods were produced.
Import outside the EU
In order to import goods from countries outside the EU, your company must be registered as an importer with the authorities.
Then, you will be assigned an EORI number. The EORI number is registered in a common EU register of companies importing and exporting to and from countries outside the EU.
You can easily import your goods from Shipmondo and fill out customs information electronically, so you have control over your customs documents, such as commercial invoices and pro forma invoices.
Brexit: Import from the UK
When purchasing goods from the United Kingdom, there are some important steps to follow. First, you need to register as an importer with the Danish Business Authority at virk.dk.
At the same time, you need to decide how you will pay the customs duties imposed on the goods.
Once you have been approved as an importer, you will automatically be assigned an EORI number.
In addition to the regular EORI number, when trading with the United Kingdom, you also need to obtain a GB EORI number, which is required to facilitate customs procedures and to correctly identify yourself to both British and EU customs authorities.
After the United Kingdom’s Brexit, when the country left the EU, a trade agreement was reached.
This agreement entails that Danish companies can receive reduced customs duties when importing from the United Kingdom. Similarly, British companies can obtain customs duty reduction when importing from the EU. It is important to be aware of these changes when importing goods.
With your Shipmondo account, you will be able to create an overview of the many new documents, including a trade invoice and/or pro forma invoice, which may become a necessity in your trade with the UK.
Import from the USA
Since the USA is outside the EU, all imported goods from there must go through customs clearance.
This means that customs duties must be paid on imported goods from the USA, both for businesses and individuals.
As a company, you must be registered as an importer when importing from the USA with the authorities.
The most common practice when paying customs duties is to join the security scheme, provided by the authorities on behalf of the EU.
You can also choose to provide your own security or pay in cash. Remember to indicate import VAT on goods imported from the USA in your VAT return.
Import from China
When importing goods from China, it is important to consider the total product costs, also known as landed costs.
The costs include the price of the product, transportation costs, insurance costs, as well as customs duties, VAT, and any other fees.
The most common trade terms for imports are either “Free on Board” (FOB) or “Ex-Works” (EXW).
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