# Are freight and insurance added to customs value on imports? | LandEdgeHQ

Source: https://landedgehq.com/blog/2026-10-20-freight-insurance-customs-value-imports/

Cross-border operations guide · October 20, 2026


Whether international freight and insurance are part of the dutiable customs value depends on the valuation system and the shipping terms, and the US and EU answers differ. Importers trading in both directions need to know which costs ride into their duty bill and which stay out.

## The United States approach

US customs value is generally the transaction value of the goods, and international freight and insurance are not part of it when they are identified separately from the price. That is why US importers watch the goods price and statutory additions such as assists and certain royalties, rather than the shipping bill, when they estimate duty.

The separation must be genuine and documented. A single lump sum price with no breakdown invites customs to treat the whole as the goods value, so invoices and terms should identify international transport and insurance distinctly where the price includes them.

## The European and border value approach

The EU and many other systems build customs value up to the point of introduction into the territory, which means freight and insurance to that point are included. An importer selling into both the US and Europe with one global price will therefore owe duty on a higher base in Europe, and landed cost models that ignore the difference misprice one market or the other.

Incoterms drive who arranges and pays these costs, but the valuation question is about inclusion, not payment. A cost can be the seller's problem commercially and still count in the buyer's customs value, a distinction contracts and cost models both need to respect.

## Domestic legs and the details that matter

Transport after the border point is treated differently from transport to it in border value systems, so the split point on a long inland journey matters and needs evidence, such as freight documents showing the legs. Sloppy splitting, all transport claimed as domestic, is the kind of adjustment that reads as a scheme when an auditor finds it.

Keep the freight invoices and insurance certificates with the entry file, matched to the shipment. Valuation questions arrive months or years later, and reconstructing which part of a bundled logistics bill was international, from a carrier portal that no longer holds the record, is a poor position to defend from.

## Packing, commissions, and the other additions

Freight is not the only cost with a valuation rule. Packing costs are commonly added, certain buying and selling commissions are treated differently from each other, and proceeds of later resale can count in some systems. A valuation review should walk the whole invoice, line by line, against the destination's rule list, instead of arguing about the freight line alone.

This is also where related party and contract terms bite: a price structured between connected companies will be tested for whether it reflects a genuine sale value, and unexplained cost exclusions are the first thing such a review pulls at.

## A working approach for multi market importers

Maintain a valuation sheet per destination market: which cost elements are in, which are out, and the evidence each entry needs. Costing, broker instructions, and invoice templates all read from that sheet, so a change in terms or law updates one document rather than living in one employee's memory.

When terms change with a supplier, especially a move between ex works and delivered pricing, trigger a valuation check before the first shipment on the new terms. The goods are the same; the dutiable value may not be, and discovering that at audit is the expensive way to learn it.

Keep reading: [How do post entry corrections fix customs value mistakes?](https://landedgehq.com/blog/2026-10-20-post-entry-corrections-customs-value), [How do discounts and rebates affect customs value?](https://landedgehq.com/blog/2026-10-20-customs-value-discount-rebates-imports), and [When do royalties and licence fees have to be added to customs value?](https://landedgehq.com/blog/2026-10-18-royalties-licence-fees-customs-value) cover the nearby cases in this series.

## Frequently asked questions

## Are international freight and insurance dutiable in the US?

Generally no, when they are identified separately from the price of the goods. US customs value rests on the transaction value of the goods plus specific statutory additions, so clean separation on documents matters.

## Why is duty owed on freight in Europe then?

Because the EU values goods at the point of introduction into its territory, so transport and insurance to that point are included in customs value. The same shipment can therefore have a higher dutiable base in Europe than in the US.

## Do Incoterms decide whether freight is in customs value?

No. Incoterms decide who arranges and pays. Valuation law decides inclusion, and a freight cost paid by the seller can still count in the buyer's customs value under a border value system.

## What evidence should importers keep for freight treatment?

Freight invoices and insurance certificates matched to each shipment, with international and domestic legs split and documented. Valuation questions arrive long after entry, when carrier records may no longer be retrievable.