What are the hidden costs of receiving post in Denmark from outside the EU?
If you purchase products from outside the EU for delivery in Denmark, or have friends or family who want to send you a gift, you should be aware of the taxes and administration fees which can be applied to your package.
Following an EU rule change which came into effect on July 1st 2021, all goods purchased online from suppliers outside the EU are subject to VAT (moms in Danish) at import into Denmark.
Earlier rules exempted packages of low values under 80 kroner from VAT charges, but the 2021 rule change meant that VAT can now be applied to all packages.
Because the Danish postal service Postnord processes packages on behalf of the country’s tax authorities, Postnord can apply an administration fee to packages on which VAT is due on import into Denmark. Since July 1st last year, this has also applied to packages with contents worth less than 80 kroner.
The Postnord administration fee is 160 kroner for all package values.
Why do I have to pay a handling fee to Postnord?
Postnord is able to apply the administration fee for all packages because it is effectively the customs broker for the Danish Customs Agency (Toldstyrelsen). As such, the post company must ensure VAT and import duties are paid on all packages on which those taxes are due prior to them being delivered to the recipient.
Can the administration charge be avoided?
There is a way to avoid the administration fee according to Postnord, but it is unclear how often it is available in practice.
All online stores outside of the EU have the option of signing up to an EU digital system which will give customers the option of paying VAT at the point of purchase, according to the Postnord website.
This means you can pay VAT before your purchase is sent on its way to Denmark, so Postnord will not have to process the VAT and will not apply the extra administration charge.
It is up to individual online stores whether they want to sign up for and integrate the EU digital system, so customers in the EU can pay VAT at the time of purchase.
The Local has asked Postnord for information on the number of packages that are arriving in Denmark with pre-paid VAT at the current time. We will update this article should we receive a response.
How much VAT is charged in addition to the 160 kroner administration fee?
To calculate what you as a private individual have to pay in customs duty and VAT for goods purchase outside the EU, you can use an online tool on the Danish Tax Authority’s website.
VAT is 25 percent and is calculated based on value, postage costs and customs duty of the package.
For goods valued up to 1,150 kroner, VAT and the import fee are due. For goods valued more than 1,150 kroner, VAT and the import fee are due and custom duty may also be payable.
Customers have the option of challenging the import duty which Postnord estimates must be paid. If the customer decides to appeal against the duty, the case is referred to the Customs Agency for a decision. However, many packages and particularly gifts are of such low value that a change to the duty will result in little difference to the costs to the customer.
“With the jar of jam that my sister sent me, the actual import duty was only 1 krone and so it was not worth the trouble to get it registered as a gift, as it would also still cost me 160 kroner to have been obliged to have Postnord as a customs agent,” Martha Fleming, a UK national, told The Local via email.
“Given that most personal post comes through what used to be an international public postal system, Postnord is in the position to hold the customer to ransom for this high customs broker admin fee on every package: if you don't pay Postnord, your package is returned to sender,” Fleming pointed out.
“I don't mind paying import tax when I am in Denmark, and I think it is reasonable to a certain extent. What I do mind paying is an administration fee, supposedly for assigning Postnord as my customs agent on each and every parcel again and again,” she also wrote.
The Local has made repeated requests for comment to Postnord with regard to its administration fee policy but has not received a response.
What are the rules for sending private packages like gifts?
If you receive a gift from outside an EU country, the rules are different compared to goods you have purchased and are sent to you.
Gifts with a value of less than 360 kroner do not incur VAT or import fees, Postnord states on its website. However, if Postnord acts as a customs agent for a gift which is not due fees, the 160 kroner processing fee will still be charged.
Gifts valued between 360 kroner and 1,150 kroner are due 25 percent in VAT and the fee. Gifts values more than 1,150 kroner are subject to VAT, the fee and customs duty of 2.5 percent.
How do I pay these fees and taxes?
According to information on the Postnord website, you can pay VAT, customs and import taxes via the postal company’s app.
Payments can be made using both bank cards and Denmark’s MobilePay app, and the Postnord app shows the status of your parcel, when it is ready for payment of VAT and fees, and when it has been released for delivery to you.
Alternatively, you can respond to an SMS or letter sent by Postnord, which the company sends as it processed your delivery. Payments can be made on the Postnord website.
Do I have any other options that may enable me to avoid paying an administration fee to Postnord?
You may be able to use a different delivery company, for example by asking the person sending you a gift to use a courier service.
In a written comment, US courier and shipping company UPS told The Local that it acted as a customs broker for international shipping and costs could be calculated in advance.
“Every shipment is different, and we recommend shippers consult our website to understand what packages may be subject to customs duties and taxes,” a UPS spokesperson said.
How does Postnord’s admin fee compare to postal services in other countries?
In Italy, the post service adjusts the processing fee depending on the value of the package. Italian couriers or postal services carrying out the delivery often have the responsibility of collecting the VAT, in which case that company will charge an additional, separate, handling fee.
Italian residents will typically see this identified as 'diritti postali'. Poste Italiane’s charge is between €2 and €15 per package, depending on its value.
Postnord appears to apply a different fees policy to deliveries it is responsible for in Sweden, compared to its standard administration fee in Denmark.
The company’s Swedish website states that “Postnord charges a cost-based fee for the handling of customs declarations”.
Specifically, consignments with a declared value of 1,600 Swedish kronor or less are eligible for a fee of 75 kronor including VAT. For consignments with a declared value exceeding 1,600 kronor, a complete customs declaration is required, and custom tariffs may be levied. The fee in these cases is 125 kronor plus VAT, according to Postnord in Sweden.
In Germany, meanwhile, there does appear to be a standardised fee when the postal service acts as the customs broker – but this is significantly less than the administration fee Postnord charges in Denmark.
Deliveries from outside the EU to Germany generally go through Deutsche Post or its package division DHL, who charge an administration fee of €6 for acting as the customs broker, equivalent to around 45 kroner.
However, different couriers may have different systems, and others may not charge anything.
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Following an EU rule change which came into effect on July 1st 2021, all goods purchased online from suppliers outside the EU are subject to VAT (moms in Danish) at import into Denmark.
Earlier rules exempted packages of low values under 80 kroner from VAT charges, but the 2021 rule change meant that VAT can now be applied to all packages.
Because the Danish postal service Postnord processes packages on behalf of the country’s tax authorities, Postnord can apply an administration fee to packages on which VAT is due on import into Denmark. Since July 1st last year, this has also applied to packages with contents worth less than 80 kroner.
The Postnord administration fee is 160 kroner for all package values.
Why do I have to pay a handling fee to Postnord?
Postnord is able to apply the administration fee for all packages because it is effectively the customs broker for the Danish Customs Agency (Toldstyrelsen). As such, the post company must ensure VAT and import duties are paid on all packages on which those taxes are due prior to them being delivered to the recipient.
Can the administration charge be avoided?
There is a way to avoid the administration fee according to Postnord, but it is unclear how often it is available in practice.
All online stores outside of the EU have the option of signing up to an EU digital system which will give customers the option of paying VAT at the point of purchase, according to the Postnord website.
This means you can pay VAT before your purchase is sent on its way to Denmark, so Postnord will not have to process the VAT and will not apply the extra administration charge.
It is up to individual online stores whether they want to sign up for and integrate the EU digital system, so customers in the EU can pay VAT at the time of purchase.
The Local has asked Postnord for information on the number of packages that are arriving in Denmark with pre-paid VAT at the current time. We will update this article should we receive a response.
How much VAT is charged in addition to the 160 kroner administration fee?
To calculate what you as a private individual have to pay in customs duty and VAT for goods purchase outside the EU, you can use an online tool on the Danish Tax Authority’s website.
VAT is 25 percent and is calculated based on value, postage costs and customs duty of the package.
For goods valued up to 1,150 kroner, VAT and the import fee are due. For goods valued more than 1,150 kroner, VAT and the import fee are due and custom duty may also be payable.
Customers have the option of challenging the import duty which Postnord estimates must be paid. If the customer decides to appeal against the duty, the case is referred to the Customs Agency for a decision. However, many packages and particularly gifts are of such low value that a change to the duty will result in little difference to the costs to the customer.
“With the jar of jam that my sister sent me, the actual import duty was only 1 krone and so it was not worth the trouble to get it registered as a gift, as it would also still cost me 160 kroner to have been obliged to have Postnord as a customs agent,” Martha Fleming, a UK national, told The Local via email.
“Given that most personal post comes through what used to be an international public postal system, Postnord is in the position to hold the customer to ransom for this high customs broker admin fee on every package: if you don't pay Postnord, your package is returned to sender,” Fleming pointed out.
“I don't mind paying import tax when I am in Denmark, and I think it is reasonable to a certain extent. What I do mind paying is an administration fee, supposedly for assigning Postnord as my customs agent on each and every parcel again and again,” she also wrote.
The Local has made repeated requests for comment to Postnord with regard to its administration fee policy but has not received a response.
What are the rules for sending private packages like gifts?
If you receive a gift from outside an EU country, the rules are different compared to goods you have purchased and are sent to you.
Gifts with a value of less than 360 kroner do not incur VAT or import fees, Postnord states on its website. However, if Postnord acts as a customs agent for a gift which is not due fees, the 160 kroner processing fee will still be charged.
Gifts valued between 360 kroner and 1,150 kroner are due 25 percent in VAT and the fee. Gifts values more than 1,150 kroner are subject to VAT, the fee and customs duty of 2.5 percent.
How do I pay these fees and taxes?
According to information on the Postnord website, you can pay VAT, customs and import taxes via the postal company’s app.
Payments can be made using both bank cards and Denmark’s MobilePay app, and the Postnord app shows the status of your parcel, when it is ready for payment of VAT and fees, and when it has been released for delivery to you.
Alternatively, you can respond to an SMS or letter sent by Postnord, which the company sends as it processed your delivery. Payments can be made on the Postnord website.
Do I have any other options that may enable me to avoid paying an administration fee to Postnord?
You may be able to use a different delivery company, for example by asking the person sending you a gift to use a courier service.
In a written comment, US courier and shipping company UPS told The Local that it acted as a customs broker for international shipping and costs could be calculated in advance.
“Every shipment is different, and we recommend shippers consult our website to understand what packages may be subject to customs duties and taxes,” a UPS spokesperson said.
How does Postnord’s admin fee compare to postal services in other countries?
In Italy, the post service adjusts the processing fee depending on the value of the package. Italian couriers or postal services carrying out the delivery often have the responsibility of collecting the VAT, in which case that company will charge an additional, separate, handling fee.
Italian residents will typically see this identified as 'diritti postali'. Poste Italiane’s charge is between €2 and €15 per package, depending on its value.
Postnord appears to apply a different fees policy to deliveries it is responsible for in Sweden, compared to its standard administration fee in Denmark.
The company’s Swedish website states that “Postnord charges a cost-based fee for the handling of customs declarations”.
Specifically, consignments with a declared value of 1,600 Swedish kronor or less are eligible for a fee of 75 kronor including VAT. For consignments with a declared value exceeding 1,600 kronor, a complete customs declaration is required, and custom tariffs may be levied. The fee in these cases is 125 kronor plus VAT, according to Postnord in Sweden.
In Germany, meanwhile, there does appear to be a standardised fee when the postal service acts as the customs broker – but this is significantly less than the administration fee Postnord charges in Denmark.
Deliveries from outside the EU to Germany generally go through Deutsche Post or its package division DHL, who charge an administration fee of €6 for acting as the customs broker, equivalent to around 45 kroner.
However, different couriers may have different systems, and others may not charge anything.
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