Customs, Duties and International Shipping on Shopify

International shipping is one of the most complex operational challenges for Shopify brands. Customs regulations, import duties, HS codes, and the post-Brexit landscape for UK merchants have created a minefield that catches brands out regularly. Getting it right opens up significant revenue opportunities; getting it wrong creates customs delays, unhappy customers, and unexpected costs.

DDP vs DAP: The Most Important Decision

When shipping internationally, you must decide who is responsible for paying import duties and taxes: you (the merchant) or the customer.

• DDP (Delivered Duty Paid): you collect duties and taxes from the customer at checkout and handle payment to customs authorities. Best customer experience — no surprise charges on delivery.
• DAP (Delivered At Place): the customer is responsible for paying duties when the parcel arrives. Risk of customer refusing delivery or being surprised by unexpected charges.
• Most ecommerce best practice recommends DDP for all markets where it's financially viable — DAP creates too many customer experience issues.

Shopify Markets and Landed Cost

Shopify Markets (included with all plans) allows you to configure international selling from a single store, with localised pricing, currencies, and duty/tax collection. Key features:

• Duties and import taxes: Shopify can calculate and collect estimated duties at checkout for 175+ countries
• HS code assignment: assign harmonised system codes to your products for accurate duty calculation
• Localised pricing: show prices in local currency with configurable rounding
• Market-specific availability: restrict products or categories from certain markets if required

Post-Brexit Considerations for UK Merchants

UK merchants shipping to the EU face additional complexity post-Brexit:

• All UK → EU shipments are now cross-border and subject to EU import duties and VAT
• Orders under €150 qualify for the EU's IOSS (Import One Stop Shop) — register for IOSS to simplify VAT compliance
• Northern Ireland has special rules — NI is treated as part of the EU single market for goods
• Commercial invoices are now required for all UK → EU shipments regardless of value
• UK merchants selling to EU consumers must comply with EU consumer protection regulations

Carrier Options for International Shipping

For small and medium volume international shipping, Royal Mail International Tracked, DHL Express, and FedEx International Priority are the primary options. For higher volumes, negotiate directly with carriers for commercial rates. Third-party shipping software like Shipstation or Shippo can aggregate multiple carrier rates and automate label generation with the correct customs documentation.

“International shipping is where many ecommerce brands leave significant revenue on the table. The brands that invest in getting the customs and duties setup right unlock markets that competitors are too intimidated to enter.”