How to Calculate Import Duty 2026: Four Origins, One Invoice

The Invoice Behind Every Number in This Guide

Most duty arguments I sit through end the same way: two people quoting percentages at each other without ever agreeing on the value those percentages apply to. So here is one order, and I keep it identical for the whole article. Twelve thousand cotton T-shirts, tariff line 6109.10, FOB Ningbo at EUR 4.00 each, so EUR 48,000 of goods. Ocean freight to Rotterdam EUR 1,850. Marine insurance EUR 120. Customs broker on arrival EUR 85. Inland trucking to a warehouse in Venlo EUR 240. Nothing else: no royalties, no tooling, no assists, no marketing contribution, no buying commission.

I have watched a Dutch buyer lose most of an afternoon insisting that his freight should be left out of the customs value because his supplier sold him FOB. His reasoning was that FOB means the goods are his only once they are on the ship, so why pay duty on a voyage he had already paid for separately. The broker's answer was shorter than the argument: the EU charges duty on the value of the goods when they reach the border, and the cost of getting them there is part of that value. Two hours, one unnecessary escalation to a customs manager, and the answer was a regulation that has said the same thing since 1994. If you only remember one sentence from this article, make it that one. Everything else below is arithmetic on top of it.

Step 1: Find the Line, Not the Product

Duty is not charged on a product description. It is charged on a ten-digit code, and the first eight of those digits come from the Combined Nomenclature. Our shirts are knitted cotton T-shirts, which puts them in 6109.10 rather than 6110 (sweatshirts and pullovers), 6205 (men's woven shirts) or 6106 (women's blouses). Under the EU's most-favoured-nation tariff, 6109.10 carries 12%. Our own duty reference for the Netherlands puts the whole national band at 0% to 17%, which is the honest way to describe it: there is no such thing as a Dutch duty rate, only a rate per line.

The expensive version of this mistake is not a wrong rate, it is a wrong line inside a measure. A client importing folding bikes had been classifying them under 8711.60 and paying the third-country rate happily for a year. The line was correct. What he had never checked was that the same line carried an anti-dumping duty on Chinese origin, which is calculated on the net free-at-frontier price before any other duty. His margin on those bikes was 19%, and the measure was 62.1% for exporters outside the named list. The classification was never the problem; assuming that a correct code means a correct duty was.

• The first four digits give you a heading, the next two a subheading, and the last two the CN code that decides the rate: 6109.10.00 is 12%.
• The final two digits are purely European. They decide whether the line needs an import licence, whether a quota applies, and whether an anti-dumping measure is waiting for you.
• Adjacent lines can be several points apart. Knitted cotton shirts at 12%, leather footwear at 8%, toys at 4.7%, smartphones at 0% -- those four rates explain most of the arguments I get asked about.
• A Binding Tariff Information decision from any EU customs authority is valid for three years across the whole union, and it is the only document that protects you from a reclassification two years later.
• Your supplier's own HS code, printed on the commercial invoice, is a suggestion from someone who has no liability for it. Check it against TARIC before the container sails.

Step 2: Origin Is a Document, Not a Country

Here is where the same shirts stop costing the same. The tariff line gives you a rate. Origin decides whether you actually pay it. Four suppliers, four different outcomes, one identical invoice value so that the only variable is the duty line.

The Turkish one deserves its own paragraph because almost everyone gets it backwards. An A.TR is not a certificate of origin. It certifies that the goods are in free circulation in Turkey or in the EU, which under the customs union is a different legal idea entirely. That means a cotton shirt woven and sewn in China, imported into Turkey, released for free circulation there with Turkish duty paid, can travel to Rotterdam under an A.TR and be charged nothing at the EU border. The duty was already collected at the external tariff of the customs union, in Turkey. I have used this legitimately, and I have also seen a buyer try to use it for goods that were still under a Turkish inward processing regime, which is not free circulation and does not qualify. If your supplier cannot explain the customs status of the goods in one sentence, they cannot give you a valid A.TR. And note the carve-out: an A.TR does not switch off anti-dumping duties, which follow the origin of the goods, not their customs status.

Step 3: The Value You Declare Is Not the Invoice

Customs value is built from the transaction price plus a short, specific list of additions. The Transport Cost Addition rule is the one that surprises people: transport and insurance are added up to the place where the goods enter the customs territory of the EU, and nothing after that. For our order that means Ningbo to Rotterdam goes in, Rotterdam to Venlo stays out. It also means the broker fee stays out, because clearance happens after the goods are already inside the territory. Getting this wrong in either direction is a self-inflicted wound: too low and you get a post-clearance demand three years later, too high and you have donated money.

Royalties are the quiet killer in this list. A client licensed a Spanish brand's logo onto imported bags and paid 4% of net sales to the licensor, invoiced from Madrid, never mentioned on the customs entry. Two years later a post-clearance audit picked it up from the licence agreement found in a document request, added 4% to the customs value of three shipments, and issued a demand for duty plus VAT plus interest. The duty was not the painful part. The VAT on the adjustment had already been reclaimed, so it had to be paid back too, which turned a EUR 6,000 duty bill into something closer to EUR 30,000 of cash leaving the account in one quarter. If you pay anyone for the right to put a mark on imported goods, tell your broker before the first entry, not after the audit.

• Add: freight to the EU border, insurance, packing, and the cost of containers or pallets that are not returnable.
• Add: royalties and licence fees the buyer must pay as a condition of the sale, even when they are invoiced to a different company.
• Add: assists, meaning free-of-charge materials, tools, moulds or design work that the buyer supplied to the seller.
• Add: selling commission paid to an agent, but not a buying commission paid to your own sourcing agent.
• Do not add: inland transport after arrival, EU duty itself, VAT, or the broker's fee for lodging the declaration.
• Do not add: your own marketing, warehousing or quality-inspection costs in the EU. They are your costs, not the goods' value.

Step 4: The Duty Line, Four Ways

Now the arithmetic, applied to the same EUR 49,970 customs value. The rate changes; the base does not; the duty follows.

Fifty cents a shirt sounds like nothing until you multiply it by the twelve thousand you buy a year and then notice what it does to the cash you need on the day the container is released. Duty is charged before VAT, and VAT is charged on the duty, so every euro of duty costs EUR 1.21 at the border. The 12% scenario needs EUR 17,749.34 in duty and VAT combined. The A.TR scenario needs EUR 10,493.70. The difference is EUR 7,255.64 on one container, and the shirts are identical. I have never seen a buyer negotiate 12% off a FOB price. I have seen plenty of buyers leave 12% on the table because nobody asked the supplier for a certificate before the goods shipped.

Step 5: VAT Sits on Top of the Duty

Import VAT in the Netherlands is 21%, and the base is the customs value plus the duty, not the invoice total and not the price you paid your supplier. In Germany it is 19%, France 20%, Italy 22%, Spain and Belgium 21%, the UK 20%. If you are VAT-registered in the country of import, this is not a cost: it is a cash-flow event, recovered on your periodic return. If you are not registered, it is a dead cost, and no amount of supplier negotiation removes it.

The permit that changes this is the article 23 authorisation in the Netherlands, postponed VAT accounting, which lets a VAT-registered importer declare import VAT on the periodic return instead of paying it at the border. It needs a Dutch VAT registration, it needs to be requested in writing before the entry is lodged, and it needs your broker to actually apply it. One client moved four containers a year through Rotterdam with a EUR 11,752 VAT bill each time and had never applied. Four turns of that is EUR 47,011 of working capital parked in a customs account for six weeks at a stretch, for the price of one form. That is the least glamorous arbitrage in this entire subject, and it is the one I would fix first.

Step 6: The 2026 Rule That Changes Small Orders

From 1 July 2026 the EU applies a flat EUR 3 customs duty to distance sales of goods valued at EUR 150 or less, and it runs until 30 June 2028. It is charged per item line, not per parcel: an order of five T-shirts attracts EUR 3, while a T-shirt plus a watch attracts EUR 6. The declarant pays it, which in practice means the seller, the importer, or the IOSS holder acting for them. For a EUR 110 basket of shirts, the old arithmetic at 12% would have been EUR 13.20, so the flat fee is cheaper. For a EUR 12 phone case, EUR 3 is a 25% duty, which is why this is a transitional measure and not a permanent tariff.

The part of the rule that almost nobody has read is the exclusion. The flat fee does not apply to goods that benefit from a preferential trade agreement or a customs union measure, provided the VAT was not collected through IOSS and the goods are declared in the H1 data set. Read that again with the Turkish shirts in mind: a consignment of EUR 140 of shirts covered by an A.TR, sold without IOSS, declared in H1, sits outside the flat fee altogether. That is the first time in years that a certificate of origin has been worth money on a parcel this small, and it is the reason I now ask small-format sellers whether they can get an A.TR or a statement on origin rather than simply assuming the flat fee is the floor.

The Three Lines in Your Spreadsheet, and the Three Errors

You do not need software to do this. You need three lines, in this order, and the discipline to keep the base constant. Duty equals customs value times the rate that applies to your line and origin. Import VAT equals customs value plus duty, times the national VAT rate. Landed cost equals goods plus freight to the border plus insurance plus duty plus the fees you actually pay, and it does not include recoverable VAT, because that is not a cost. Every mistake I get called about is a violation of one of those three lines.

If I had a budget of EUR 5,000 to spend on this supply chain, I would not spend it on another freight quote. I would spend EUR 400 on a binding tariff decision for the three lines that make up 80% of my volume, and the rest on getting origin evidence into the purchase order as a condition of payment, with the certificate number on the invoice before the balance is released. Freight rates move every fortnight and everyone negotiates them. The duty line is decided months earlier, in a document nobody reads, and it is worth 12% of the goods value when it goes wrong.

• Error one: charging duty on the FOB price. On this order that understates the base by EUR 1,970 and the duty by EUR 236.40, which the audit will find.
• Error two: adding the broker fee to the customs value. It looks conservative, it is wrong, and it costs 12% of EUR 85 plus 21% VAT on the difference.
• Error three: reading DDP as duty-free. It means duty-paid by someone, and if the seller is not the importer of record, that someone is you, with a demand arriving weeks after the goods were sold.
• Error four, the expensive one: assuming that a valid tariff code means a valid duty. Check the line for anti-dumping, quotas and licences, not just the percentage.

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