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DDP vs DAP for parcels

Delivered duty paid against delivered at place for parcels: what Incoterms 2020 say, who pays duty and tax, what a refused DAP parcel costs, and how to run DDP.

Updated · 11 official sources

Under DDP (delivered duty paid) the seller delivers the goods cleared for import with the duty and import taxes paid, so the buyer pays nothing more on delivery. Under DAP (delivered at place) the seller delivers to the named place and the buyer clears the goods and pays the import charges, usually to the carrier, before the parcel is handed over. For parcels, the choice decides what the buyer sees at checkout and what can go wrong at the door.

Rules as of 30 October 2026.

What do DDP and DAP mean in Incoterms 2020?#

DDP and DAP are two of the eleven Incoterms 2020 rules of the International Chamber of Commerce, the current edition, in force since 1 January 2020. Both are among the seven rules for any mode of transport, and both name a place of destination; they differ in who takes on import clearance and its duties and taxes.

DAP DDP
Seller delivers to The named place, ready for unloading The named place, cleared for import
Import clearance Buyer Seller
Import duty and taxes Buyer Seller
What the buyer pays on delivery Duty, tax and the carrier's fees Nothing

DDU, "delivered duty unpaid", isn't one of the eleven Incoterms 2020 rules, though carriers still use the label for services where the recipient pays. DPU (delivered at place unloaded) replaced the old DAT and adds the seller's duty to unload. Incoterms say who does what between buyer and seller; they don't change what customs charges.

The eleven Incoterms 2020 rules

Seven rules work for any mode of transport: EXW (Ex Works) and FCA (Free Carrier), named for the place of delivery; CPT (Carriage Paid To) and CIP (Carriage and Insurance Paid To), named for the place of destination; and the three D rules, DAP, DPU and DDP, under which the seller delivers at the destination. DPU adds unloading to DAP, and only DDP leaves import clearance, duty and tax with the seller.

Four rules are for sea and inland waterway transport: FAS (Free Alongside Ship) and FOB (Free on Board), named for the port of loading, and CFR (Cost and Freight) and CIF (Cost, Insurance and Freight), named for the port of destination. Buyer and seller can still agree on an older edition, as long as the contract names it.

Who pays duty and tax under DDP?#

Under DDP the seller pays the duty and import tax, usually by collecting the amount at checkout and settling it with the carrier or customs at import. The seller, or a broker acting for it, takes the importer's role, so the seller also answers for the code, origin and value declared, and for any shortfall found later.

Who may act as importer is set by each country. In the United States, entry can be made by the owner or purchaser of the goods or by a licensed customs broker they designate. In the EU, the declarant is the main debtor for the customs debt, and the same person owes the Union handling fee that the Commission expects to apply to distance sales from 1 November 2026. The landed cost guide shows what goes into the amount you collect.

What does a DAP parcel cost when the buyer won't pay?#

A DAP parcel that the buyer refuses or never pays for costs the seller the outbound shipping, the return or disposal, and often the sale, while the duty and tax were never collected. Even when the buyer pays, the bill arrives after the purchase, with the carrier's fee on top.

Take cotton T-shirts worth €180, sent DAP with €15 shipping to a buyer in Ireland. Over €150, the order pays the normal EU duty and Irish VAT at the door. The €10 carrier fee is the figure Ireland's Revenue uses for illustration in its own examples; real fees vary by carrier.

Line Amount
Paid at checkout: goods and shipping €195.00
Customs duty, 12% of €195.00 €23.40
Irish VAT, 23% of €218.40 €50.23
Carrier's fee for clearing and advancing the charges €10.00
Demanded from the buyer on delivery €83.63

The buyer is asked for €83.63 more than they expected, 43% of what they paid. Shipped DDP, the same €73.63 of duty and VAT would have been in the checkout price, and any carrier fee would be settled between the seller and the carrier. Revenue advises consumers to check a website's terms before buying, because some sites collect the charges at checkout and others leave them for delivery.

Returns cost more under the new EU rules too. For distance sales in consignments up to €150, a seller can no longer have the declaration invalidated when goods come back, so the €3 duty isn't refunded that way, and the Union handling fee can't be refunded at all.

When does DAP still make sense?#

DAP still makes sense when the buyer is a business that wants to be the importer, or when an order is large enough that the buyer expects formalities. A buyer registered for VAT or GST can usually reclaim the import tax it pays and may use its own broker, so DDP would only add a step to unwind.

For consumer parcels DAP is getting harder to use. The UK, Australia, New Zealand and Norway expect sellers over their thresholds to charge tax at checkout on low-value goods, and EU sellers who register for IOSS do the same, so part of the landed cost is collected up front either way. And in the United States, since 24 July 2026, duty on postal shipments is no longer collected from the addressee on delivery. A postal entry has to be filed, with a bond, by the owner or purchaser of the goods or a broker they designate, so the importer's role needs an owner before the parcel ships.

What changed and when#

The rules on who pays at import moved in 2025 and 2026 for the two biggest parcel destinations, and more dates are set. In the United States, low-value parcels lost their exemption and mail lost collection at the door; in the EU, distance sales gained a declarant order and a per-item duty. Each entry links to its official text.

  1. Upcoming

    UK sets new rules for low-value imports

    By October 2028 at the latest, goods of £135 or less pay customs duty and an overseas seller can use a UK fiscal representative, jointly and severally liable for its customs debts. HMRC, updated 28 October 2026 (opens in a new tab)

  2. Upcoming

    EU temporary rules for distance sales end

    The €3 duty ends and so does the temporary list of who must lodge the declaration for distance sales, which runs until 30 June 2028. European Commission guidance (opens in a new tab)

  3. Upcoming

    EU importer answers for product compliance

    One year after the new Union Customs Code entered into force on 20 September 2026, the importer, who is also the debtor, must ensure the goods meet the other rules customs enforces. European Commission guidance (opens in a new tab)

  4. Upcoming

    US de minimis ends by law

    Every commercial shipment to the United States owes duty, with no exemption left to suspend. CBP, 91 FR 37789 (opens in a new tab)

  5. Upcoming

    Formal entry for some US mail

    Under 19 CFR 145.12(a)(2)(v) and (vi), mail under another agency's rules, paying chapter 98 or 99 duties, or claiming chapter 98 or FTA duty-free treatment needs formal entry. CBP, 91 FR 66638 (opens in a new tab)

  6. Upcoming

    Entry Type 13 required for some US mail

    Informal entry of mail subject to Section 201, 232 or 301 duties or an agency's rules must use Entry Type 13. CBP, 14 October 2026 (opens in a new tab)

  7. EU handling fee of €2 per item expected

    Expected from 1 November 2026, once its delegated act completes scrutiny: the declarant owes it on every distance sale and it can't be refunded. European Commission guidance (opens in a new tab)

  8. US mail duty no longer collected on delivery

    The owner, purchaser or their broker files the postal entry with a bond and pays by the 7th of the month after arrival. CBP, 91 FR 37801 (opens in a new tab)

  9. EU sets who declares distance sales

    The IOSS holder declares first, then the special arrangements user, then the importer's indirect representative; the consumer only as a last resort, and never with an IOSS number. European Commission guidance (opens in a new tab)

  10. EU €3 duty per item starts

    Distance sales up to €150 pay €3 per item, whichever VAT route the seller uses. Council Regulation (EU) 2026/382 (opens in a new tab)

  11. US de minimis suspended for every country

    Low-value parcels owe duty, so someone has to pay it at import under DDP or DAP. Executive Order 14324 (opens in a new tab)

How do you run DDP?#

Running DDP means quoting the full landed cost at checkout and then making sure the declaration matches what you quoted. The steps are the same in every market, but the registrations and the carrier service differ, so start with the markets that carry most of your international orders.

Before the first DDP order to a market, have these in place:

Once orders flow, reconcile each carrier invoice against what you collected. A difference usually points to a wrong code, origin or value.

Common questions#

Is DAP the same as DDU?#

In parcel shipping, mostly yes. DDU is an old term that isn't one of the eleven Incoterms 2020 rules; carriers still use it for services where the recipient pays duty and tax, which is the DAP split of costs.

Can I charge the customer duties and taxes at checkout?#

Yes. That is how DDP works for online sales: you collect the duty and tax with the order and pay them at import, so the buyer pays one price. In the EU, Ireland's Revenue describes both models to consumers, charges collected at checkout and charges collected on delivery.

Who is the importer of record when I ship DDP?#

Usually the seller or a broker acting for it, because whoever is named as importer owes the duty. In the United States the importer must be the owner or purchaser of the goods or a licensed broker they designate; the US entry process guide covers informal and postal entries.

Sources#