How can a non-UK company deliver customs compliantly to the UK using DDP Incoterms?
The Delivered Duty Paid (DDP) Incoterm places all the risk and responsibility on the seller of the goods. This includes costs of any duty, taxes and customs clearance in the country of import.
Overseas sellers not established in the UK are treated as ‘non-established taxable person’ (NETP) and require a tax representative in the UK for VAT purposes.
Additionally, overseas sellers also need to contract a customs agent that will act on an indirect representation basis, meaning they would be jointly and severally liable for any customs debt.
This can be the case both with general freight and express consignments where the fast parcel operator acts as the indirect representative for the seller and charges all duties and taxes back to the exporter.
While we have seen the emergence of variations to DDP Incoterms such as where VAT is being paid by the buyer/importer and the duties and clearance costs are charged back to the exporter, these arrangements are made outside of Incoterms governance.