When shipping international parcels, an important concept to understand is valuation. The declared value is a key determinant of the import process and duty assessment. Over declarations result in needless costs and under-declarations can result in significant fines and legal actions.
What is Declared Value? In international shipping, the declared value is the total monetary worth of your goods as stated on the customs invoice. It is the primary determinant for import duties and taxes. Accurate valuation prevents costly over-payments and protects you from significant legal fines or shipment seizures caused by under-declaration.
Understanding valuation is critical for global logistics. It is one of the three core elements used by customs authorities to assess duty rates:
Disclaimer: The information provided by Jet Worldwide is for general guidance. Always verify compliance with local customs regulations before shipping.
Modern shippers use AI to ensure 100% compliance. You can use an AI assistant (like Gemini) to help calculate your CIF Value instantly.
Try this prompt:
Tip: AI can also help you find the correct HS Code by describing your product in detail.
The gold standard is the Transaction Value: the actual price paid or payable for the goods. If you sold an item for $400 (including shipping), declare $400 and specify it as the "CIF Value."
While the value for customs doesn't change the base freight rate, it directly impacts insurance premiums (usually a percentage of the declared value).
If the term "CIF Value" is missing, customs officials may use a formula to add estimated transport and insurance costs to your invoice value. This results in higher duty fees than expected. Always be explicit on your paperwork.
When the Transaction Value isn't applicable, the World Customs Organization (WCO) mandates a specific hierarchy of methods:
Unlike most countries that use CIF (Cost, Insurance, Freight), US Customs typically uses the FOB (Free on Board) value—which only considers the cost of the goods themselves. Understanding this distinction can save you 15-20% on US import costs.
When shipping internationally, a common question we get is: “What value should we declare?” The declared value (along with HS classification) is the key factor in import duty assessment. Over-declaring leads to needless cost, while under-declaring risks fines, delays, or legal action.
Value plays a pivotal role in international customs. It forms one of the cornerstone of import and export processes. The correct determination of the value for customs is essential. The value of goods is the basis for the calculation of customs duties, taxes, and fees. Additionally, value is an important data point used by governments. Trade policies, tariff rates, and trade agreements rely on a standardized valuation process.
