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Origin and trade agreements

Discounts, coupons and free items on a commercial invoice

How to show discounts, coupon codes, free gifts with purchase and free shipping on a commercial invoice, with the customs value rules and a worked example.

Updated · 9 official sources

Declare the price the customer actually paid: list each item at its regular price, show each discount beside it, and give a free item its own line with a note, because customs value goods on the price actually paid or payable, after any discount that was part of the sale.

Rules as of 30 October 2026.

That price is the transaction value: the price actually paid or payable for goods sold for export, adjusted for a few listed costs. It's the first valuation method in the US and the EU, and the UK's Method 1.

Does customs accept the discounted price?#

Customs accept a discounted price as the basis of customs value when the discount was part of the sale the goods were shipped under. US regulations say the price paid may be the result of discounts (19 CFR 152.103(a)(1)), and EU rules count discounts that the sales contract provides for when the declaration is accepted.

  • In the US, every invoice must set out each discount from the list price (19 CFR 141.86(g)). CBP's own example: goods offered at $100 less 2% for cash, the buyer pays $98, and the transaction value is $98 (152.103(a)(1), example 5).
  • A rebate or price cut agreed after the goods are imported is disregarded in the US (152.103(a)(4)).
  • In the EU, a discount counts if the sales contract provides for it and its amount when the declaration is accepted, and a discount from a later change to the contract doesn't (Implementing Regulation 2015/2447, Article 130).

How do you spread an order-level coupon across items?#

An order-level coupon has to be spread across the invoice lines, because customs need a price for each item and items can carry different duty rates. Share it in proportion to each line's value, show the list price, discount and net price on every line, and check that the lines add up to the payment.

US invoices must give the purchase price of each item (19 CFR 141.86(a)(5)), so a single "£28 off" line at the bottom leaves the declarant to do the sharing.

How do you declare free items and buy-one-get-one offers?#

A free item shipped with a paid order is part of that sale, not a gift. CBP's gift exemption excludes articles "given" in connection with a purchase, such as a bonus article (19 CFR 10.153(a)), and HMRC takes the same view of free replacement items packed with an order: the sale price covers the total quantity shipped.

  • A gift with purchase goes on its own line with its description, HS code, origin and quantity, priced 0.00, with a note such as "free with order 10482, included in order price". Leave it off and the box holds goods the paperwork doesn't mention.
  • Buy one, get one free goes on one line: quantity 2, at a unit price of half what was paid, with a note naming the offer.
  • A free sample sent on its own isn't part of any sale, so it needs a pro forma invoice with the value it would sell for (19 CFR 141.86(a)(6)). HMRC values such goods under Methods 2 to 6 rather than Method 1.

What about free shipping?#

Free shipping is a cost the seller absorbs, not a missing charge, and it affects customs value differently by country. The US leaves international freight and insurance out of transaction value (19 CFR 152.103(a)(1), example 4), while the EU adds the cost of transport and insurance up to its border to the price (Union Customs Code, Article 71(1)(e)).

List freight on its own line either way, as US invoices must itemize every charge (19 CFR 141.86(a)(8)). When the customer paid nothing for it, write what you paid the carrier with a note such as "paid by seller, not charged to buyer", so the declarant can apply each country's rule.

Worked example#

A customer in Leeds orders a waxed jacket listed at £100 and a wool scarf listed at £40, and uses a 20% basket code. A canvas tote bag that normally sells for £10 comes free with the order, and so does shipping. The customer pays £112. Prices are before UK VAT.

Line List price Discount Price paid
Waxed cotton jacket, made in Portugal £100.00 £20.00 £80.00
Wool scarf, made in Italy £40.00 £8.00 £32.00
Cotton tote bag, made in India, free with order, included in order price £0.00 £0.00
Freight paid by seller (£9.50), not charged to buyer £0.00
Total £140.00 £28.00 £112.00

The coupon is shared in proportion to value: 20% of each line. The consignment is worth £112, which is under £135, so under the UK's rules for goods sold directly to customers the seller charges UK VAT at the point of sale, and no customs duty is due on non-excise goods worth £135 or less. The UK plans to end that duty relief on a date set in regulations by October 2028 at the latest. The UK VAT guide covers the checkout side, and the landed cost calculator works out the same order for any destination.

Common questions#

Should the invoice show the price before or after the discount?#

Both: the list price, the discount and the price paid. US invoices must set out every discount (19 CFR 141.86(g)), and the price paid is where customs value starts.

Can I put zero on a free item?#

On a free item that ships with a paid order, yes, with a note that it's included in the order price. A free item sent on its own needs the value it would sell for, as the commercial invoices guide explains for pro forma invoices.

Does a refund after delivery change the customs value?#

No. The US disregards a rebate after importation (19 CFR 152.103(a)(4)), and the EU ignores a discount from a later contract change (Implementing Regulation 2015/2447, Article 130). Duty refunds follow their own rules (replacement items).

Sources#