Landed cost is the all-in cost of getting a product from the supplier's factory to your door, ready to sell. It's far more than just the FOB invoice price — freight, insurance, customs duty, VAT, brokerage, and handling fees can easily add 25-50% on top of the product cost. Our import export cost calculator implements the standard CIF-based duty calculation: CIF = Product + Freight + Insurance, Duty = CIF × Duty Rate, VAT = (CIF + Duty) × VAT Rate, plus all handling and brokerage fees. It returns total landed cost, per-unit cost, markup over FOB, and a percentage breakdown of every cost component so you know exactly where the money goes.
Input unit cost and quantity to compute FOB value.
Provide total freight cost and insurance rate (typically 0.3-0.5%).
Look up your product's duty rate and your country's VAT rate.
Include brokerage, handling, and other fees if known.
See total cost, per-unit cost, markup, and detailed breakdown.
Customs authorities worldwide use CIF (Cost + Insurance + Freight) as the basis for duty calculation. VAT is then layered on top of CIF + duty. This 'tax on tax' structure is why high-VAT countries can dramatically inflate import costs even with modest duty rates. Brokerage and handling fees are added on top of all that. Knowing the breakdown lets you negotiate freight, choose smarter Incoterms, and shop tariff classifications.
CIF = FOB + Freight + Insurance • Duty = CIF × Duty% • VAT = (CIF + Duty) × VAT% • Total Landed = CIF + Duty + VAT + Fees
Insurance is typically 0.3-0.5% of (FOB + Freight) — cheap insurance for valuable cargo
Duty is calculated on CIF, not just product cost — freight inflates your duty bill
VAT is layered on top of CIF + duty — high-VAT countries can double your tax burden
VAT is usually recoverable for VAT-registered importers — toggle it off for true cost
Brokerage and handling fees often forgotten — add 1-3% of shipment value as a buffer
Tariff classification (HTS code) is the single biggest variable — get it right and verify
FTAs (free trade agreements) can drop duty to 0% if you can prove origin
Landed cost is the total price of a product once it arrives at your door, and it is almost always significantly higher than the factory invoice price. For importers, failing to account for every cost component is the fastest path to margin erosion. A typical international shipment incurs the FOB (Free on Board) product cost, ocean or air freight charges, cargo insurance (usually 0.3-1.5% of cargo value), customs duties (which vary from 0% to over 25% depending on the HS code and country of origin), VAT or import sales tax, customs brokerage fees, port handling charges, and last-mile delivery. Together, these can add 25-60% on top of the FOB price. Duties are calculated on the CIF value (Cost + Insurance + Freight), not the product cost alone, and VAT is then layered on top of CIF plus duty — creating a compounding effect that surprises first-time importers. Understanding each cost component as both an absolute dollar amount and a percentage of total landed cost is essential for accurate pricing, margin planning, and supplier negotiation. Businesses that track landed cost per unit can make better sourcing decisions and identify which cost levers offer the most savings.
Importers who price products based on supplier invoice alone routinely lose money on every sale. The supplier invoice is just the start — by the time freight, insurance, duty, VAT, and brokerage are added, the true cost can be 25-50% higher.
Knowing your landed cost is the difference between profitable importing and slowly going broke. Always price your retail off landed cost, not FOB.
The single biggest variable in your duty bill is the tariff code (HS/HTS). Get it wrong and you might pay 25% when you should pay 5%, or vice versa.
Codes can also unlock free-trade-agreement benefits — the same product imported from Mexico vs China can have wildly different duty rates under USMCA.
Always have a customs broker verify your classification, especially for high-value or recurring shipments.
Landed cost is the total cost of getting a product to your door:
Missing any component understates your true unit cost and erodes margin.
For a $10,000 order with $800 freight, $100 insurance, 5% duty, and 20% VAT, the landed cost climbs well above $12,000. This calculator sums every line so you price and source with the real number, not just the invoice price.
Most customs authorities assess duty on the CIF value — the cost of the goods plus international insurance plus freight to the border — not the bare product price. That means shipping and insurance are effectively taxed.
Some countries (including the US) use FOB value instead, excluding freight from the dutiable base.
Knowing which valuation your destination uses materially changes the duty owed, so this calculator lets you build the customs value correctly.
Once you have the customs value, duty equals value × the duty rate for the product's HS code. Rates come from the importing country's tariff schedule (for the US, the USITC HTS).
Specific duties (a fixed amount per unit) apply to some goods instead of a percentage.
Because the rate hinges entirely on correct HS classification, verifying the code is the single most important step in estimating import cost accurately.
Import consumption tax is charged on the landed value including duty, so it compounds on top of everything else. A 20% VAT on a $10,500 value-plus-duty adds $2,100.
Business importers can often reclaim import VAT, but it still ties up cash at the border.
The US has no federal import VAT, so US importers mainly budget duty and fees, while EU/UK/Australian importers must include VAT/GST as a major landed-cost component.
Beyond duty and tax, importers pay a customs broker to clear the shipment, plus carrier handling, terminal, and documentation fees.
Brokerage runs from a flat fee to a percentage of value; handling and disbursement fees add up quickly on smaller shipments where they represent a larger share of cost.
These fees are easy to overlook but can add several percent to landed cost, so include them when comparing suppliers or shipping methods.
Incoterms (ICC) define exactly which costs the seller versus buyer bears:
The quoted unit price means little without the Incoterm, because two 'identical' quotes can differ by 15-20% in landed cost depending on which term applies. Always compare quotes on a landed-cost basis.
The HS code sets the duty rate, so classification directly drives landed cost. A few digits' difference can move a product between a 0% and a 12% duty, or trigger anti-dumping duties entirely.
Using the official tariff schedule and, when in doubt, requesting a binding ruling from customs prevents both overpayment and penalties for under-payment.
Treat HS classification as a cost-optimization step, not a formality.
When you buy in a foreign currency, exchange-rate movement between order and payment changes your landed cost. Customs also converts the invoice to local currency at an official rate for duty assessment, which may differ from your bank's rate.
For thin-margin importing, hedging or timing payments can matter as much as the duty rate.
Model landed cost at a realistic exchange rate, and revisit it if the currency moves significantly before settlement.
The frequent mistakes are:
Each omission understates cost and can turn a profitable order into a loss.
Build the full landed-cost stack — goods, freight, insurance, duty, tax, and fees — for every sourcing decision, and compare suppliers on landed cost rather than unit price.
Data sourced from trusted institutions
All formulas verified against official standards.