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How to Deal With Tax Problems in Dropshipping?

Views:439     Author:Site Editor     Publish Time: 2021-05-14      Origin:Site


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Drop shipping model is a method in supply chain management. Corresponding to our cross-border e-commerce operations, dropshipping orders means that a foreigner is acting as an agent for our products in a foreign country. After he receives the order, he directly dumps it to us, and we send it directly to his customers, and he makes the difference. In the process of business, cross-border dropshipping will relate to the tax problems. Then how to deal with tax problems in direct drop shipping? In this article, we will discuss this problem when you are drop shipping from China, and let you further know the ins and outs of the business model when dealing with the customs office.

 

For drop shipping sellers, the customs duties and drop shipping sales tax are always primary problems they concern. If you want to manage well e-commerce dropshipping business, you need to know how to deal with the customs duties. You have to make sure their goods are not held hostage in the customs office especially for the valuable goods with expensive price tags. So, you should always check for the option of importing a larger quantity of private or white label products by themselves to avoid these problems.

 

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Whenever you are shipping items with high price to a country such as EU countries where the taxation free barrier is relatively low, you had better make sure that the total order value is lower than the maximum value set by their customs office, then your products will not be held by the local customs office, because your products would be looked as tax free. In addition, you should know some knowledge about local tax rules. For example, in Europe, the threshold of tax is from 10 to 22 euros, and it depends on the different countries. If you are preparing to drop ship goods which are more expensive than the standard customs limit, you have to obey the local tax laws, and pay drop shipping sales tax.

 

Whats more, the main tip in dealing with tax problems is that the information of the goods should be fully transparent. For example, you should state your products are coming from some other country. You had better not hide the information of a commercial item that you are sending or keep it as a secret to avoid the customs office finding out about it. Otherwise, it will be disaster for your customers and company. If you drop shipping from China, you should not try to systematically under declare the value because the customs office often inspect and compare the prices of items.

 

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In fact, drop shipping mode is not strange in the foreign trade business. cross-border dropshipping sellers know that they should pay custom duties when they import their goods to abroad. Usually if the value of goods is relatively low, it could be tax free and this becomes a bonus for most buyers. But there are still some people who want to start the cross-border drop shipping business do not know more about the tax problems. So they should learn before starting dropshipping business.


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