DAP vs DDP UK import terms for shipments from India

An Incoterm decides who pays and who carries risk, not who HMRC treats as importer. How DAP and DDP work in practice for shipments from India to Great Britain.

By Rahul Sharma, Director6 October 20268 min read

On this page

What is the difference between DAP and DDP?
Does the Incoterm decide who is importer of record?
Who is the importer under DAP terms?
What does a seller based outside the UK need to sell DDP?
How is import VAT handled under DAP and DDP?
Who pays if HMRC later raises a customs debt or denies a preference claim?
How should a UK buyer choose between DAP and DDP?
Questions buyers ask
Sources

In short

DAP and DDP allocate cost and risk between seller and buyer; they do not decide who HMRC treats as importer, declarant or debtor.
Under DAP the UK buyer is the importer, needs a GB EORI, and can use postponed VAT accounting if it is VAT-registered and owns the goods.
A seller not established in the UK cannot declare goods for free circulation in its own name, so selling DDP needs a UK-established partner or indirect representative.
Import VAT can be recovered only by the owner of the goods at import, whatever the Incoterm and whoever is named as importer of record.
If HMRC later denies a preference claim, the duty is owed by the declared importer and any indirect representative, and possibly by a supplier that knowingly gave false origin information, whatever the contract indemnity says.

What is the difference between DAP and DDP?

Under DAP (Delivered at Place), the Indian seller gets the goods to a named place in the UK and the UK buyer clears them for import and pays the duty and import VAT. Under DDP (Delivered Duty Paid), the seller delivers to the same kind of named place but must also clear the goods for import and pay the import charges.

Risk passes at the same point under both rules: when the goods are at the buyer's disposal on the arriving means of transport, ready for unloading at the named place. Neither rule obliges the seller to unload (the rule that does is DPU), so name a precise point, such as a full delivery address or a named terminal or warehouse at the UK gateway, not just a city or port name.

Obligation	DAP	DDP
Export clearance in India	Seller	Seller
Carriage and risk to the named UK place	Seller	Seller
Unloading at the named place	Buyer	Buyer
UK import clearance	Buyer	Seller
UK import duty	Buyer	Seller
UK import VAT	Buyer	Seller in principle; state it expressly in the contract

Incoterms 2020 is still the current ICC edition as of October 2026, so write the edition into every India-UK contract. Variants such as 'DDP, VAT unpaid' are contract amendments, not Incoterms rules, so the contract must say exactly which charge each party pays.

Does the Incoterm decide who is importer of record?

No. An Incoterm is a contract allocation of cost and risk, not a customs status. Who HMRC treats as liable, who may make the declaration and who may recover the import VAT are settled by UK law, whatever the contract says.

Three rules do that work in Great Britain (Northern Ireland follows EU-based rules under the Windsor Framework):

Liability follows the declaration. The person in whose name a customs declaration is made is liable for the import duty, and so is the person on whose behalf it is made, jointly and severally (Taxation (Cross-border Trade) Act 2018, section 6).
Only a UK-established person can declare goods for free circulation in its own name (Customs (Import Duty) (EU Exit) Regulations 2018, regulation 15). HMRC's establishment guidance says a UK VAT or EORI number does not by itself prove establishment.
Import VAT recovery follows ownership. According to HMRC's VAT Input Tax manual, only the person with the right to dispose of the goods as owner can recover it. An importer of record that does not own the goods, such as a toll operator or an overseas seller that has already sold the goods to its UK customer, cannot.

The Incoterm appears on the declaration only as data, in Data Element 4/1 for Method 1 valuations, and HMRC states that it does not set Incoterms. Incoterms do not transfer title either, so set the point at which ownership passes separately in the contract. That point decides who can recover the VAT.

Who is the importer under DAP terms?

Under DAP the UK buyer is the importer. It needs a GB EORI number, pays the import duty, and either pays the import VAT or accounts for it through postponed VAT accounting if it is VAT-registered and owns the goods.

As a UK-established business, the buyer can appoint a customs agent on either basis:

Direct representation: the agent declares in the buyer's name. The buyer is solely liable for the duty, the import VAT and the accuracy of the declaration. If the buyer gave clear instructions and the agent made a deliberate or unreasonable error, the agent may become jointly and severally liable too.
Indirect representation: the agent declares in its own name on the buyer's behalf. Both are jointly and severally liable, and HMRC may seek payment from either.

The instruction must be in writing and say whether the agent acts directly or indirectly, and the buyer remains responsible for checking its declarations. DAP suits a buyer that already imports: as importer it answers for the commodity codes, valuation and preference claims made in its name, instructs its customs representative, and sees the import VAT on its own monthly statement.

What does a seller based outside the UK need to sell DDP?

A seller that is not established in the UK needs a UK-established party to take on the importer's role. It cannot declare goods for free circulation in its own name, so it must either use a UK indirect representative, which shares liability for the duty and import VAT, or have a UK partner import the goods in its own right.

The ICC lists the UK as a market where DDP is difficult for non-UK sellers and suggests DAP or DPU instead. HMRC's published EORI guidance also leaves acting as importer for free circulation off the list of activities for which a non-established business can get a GB EORI. Any DDP model relying on an Indian seller's own GB EORI as importer should be confirmed with HMRC first.

VAT follows the structure. Goods imported by the supplier, or under its directions, are treated as supplied in the UK under section 7(6) of the VAT Act 1994. A non-established taxable person has no registration threshold: it must register if it makes, or expects within 30 days to make, any taxable UK supply, unless HMRC approves an exemption because all its UK sales are zero-rated.

DDP into Great Britain is therefore usually built in one of three ways:

The UK partner buys the goods and resells them to the buyer. As owner at import, it can recover the import VAT if VAT-registered.
A UK VAT-registered business imports and sells in its own name as agent for an overseas seller that is not a taxable person. Section 47 of the VAT Act treats it as importing and supplying as principal, so it recovers the import VAT and charges VAT on the sale.
A UK indirect representative declares the goods for the seller and shares the liability. The seller then generally has to register for UK VAT, and its EORI position must be confirmed with HMRC.

How is import VAT handled under DAP and DDP?

Import VAT can be recovered only by the owner of the goods at import, and postponed VAT accounting is open only to a VAT-registered owner. Under DAP that is normally the buyer. Under DDP it is whoever the structure makes owner at import, and the buyer usually recovers VAT through the seller's or partner's UK VAT invoice, not a C79 certificate or postponed VAT statement.

Postponed VAT accounting (PVA) lets a VAT-registered importer account for import VAT on its VAT return instead of paying it at clearance. As of October 2026 it needs no HMRC approval and is not compulsory, but the importer must use the goods for business, have the right to dispose of them (usually as owner) and show its VAT registration number on the declaration. An agent must hold written confirmation before selecting PVA. Monthly PVA statements appear on the Customs Declaration Service dashboard, usually by the 10th working day, and are archived after six months, so download each one.

Duty can be paid at clearance or through a duty deferment account, collected by Direct Debit on the 16th of the following month (or the next working day). Anyone can apply for an account, but it needs a guarantee from a UK-established, PRA-regulated institution unless HMRC grants a guarantee waiver, and only UK-established businesses can get a waiver.

The VAT rate depends on the product's commodity code, not the Incoterm. Most food is zero-rated in the UK, but there are exceptions, so check each line.

Who pays if HMRC later raises a customs debt or denies a preference claim?

The person declared as importer pays, together with any indirect representative. Under DAP that is the buyer; under DDP it is the UK partner or whoever else is named as importer. A contract indemnity can move the cost between the parties, but HMRC is not bound by it.

HMRC normally has three years from the date the debt arose, usually the entry date, to notify it. Where an HMRC officer considers that an offence has been committed, that period is extended to 20 years for entries made on or after 1 January 2021. HMRC first sends a 'right to be heard' letter with 30 days to respond, then a final decision, and any demand is issued as a post-clearance demand (C18). Interest is charged on amounts paid more than 10 days after the C18 is issued.

The UK-India Comprehensive Economic and Trade Agreement has applied since 15 July 2026, and with a valid claim many Indian goods now enter duty-free. The claim belongs to the importer, and the agreement's rules of origin chapter requires it to keep the proof of origin and supporting records for at least four years. If HMRC denies the claim, the duty is owed by the importer and any indirect representative.

The seller is not automatically clear either. A supplier that provides origin information it knew, or ought reasonably to have known, was false can also be liable under section 6 of the 2018 Act. The guide to the India-UK trade agreement for importers covers proofs of origin and the rules of origin.

How should a UK buyer choose between DAP and DDP?

Choose DAP if you are VAT-registered, import regularly and want control of clearance, VAT recovery and preference claims. Choose DDP if you want goods delivered cleared at a known landed cost and are content for a UK partner to hold the importer role and its liabilities.

Factor	DAP	DDP
Importer of record	UK buyer	UK partner or other declared importer
Import VAT recovery	Buyer, as owner, through PVA or a C79 certificate	Through the seller's or partner's UK VAT invoice
Instructs the agent, answers for codes and valuation	Buyer	Seller and its UK partner
Landed-cost certainty	Buyer meets duty and clearance costs as they arise	Fixed only if the contract says so
Liability if a preference claim is denied	Buyer, plus any indirect representative	Declared importer, plus any indirect representative

Price certainty under DDP is only as good as the contract, so ask what happens if a duty rate changes, HMRC reclassifies a line or a preference claim fails. Under either term, settle these points in writing:

The rule, the edition and a precise named place, for example 'DDP [named terminal, warehouse or full address] Incoterms 2020'.
Under DDP, who bears UK import VAT.
When ownership passes, so the importer at the time of import is also the owner.
Whether the customs agent acts directly or indirectly.
Who supplies the proof of origin, and who bears the cost if HMRC denies a preference claim or issues a C18.
Under DDP, an invoice showing UK delivery, duty and VAT separately. Import duty is excluded from customs value, and HMRC's delivery costs guidance lets UK transport be deducted only when charged separately and distinguishable.

Britbasket offers both terms. Under DDP a UK-established partner company is importer of record and the buyer takes cleared goods inland. Under DAP the buyer is importer of record and the partner lodges the entry as the buyer's representative. Some consignments are exported on Britbasket's own registrations and others on the producer's, where the manufacturer is exporter of record; the export and compliance services page sets out who does what. To check which term suits a consignment, send us the product and delivery details.

Questions buyers ask

Can an Indian exporter act as importer of record in the UK?

Not in its own name for goods released into free circulation in Great Britain. UK law lets only UK-established persons make that declaration, and HMRC's published EORI guidance does not list importing among the activities open to non-established businesses. An Indian exporter selling DDP therefore relies on a UK partner that imports in its own right, or on a UK indirect representative that shares liability for the duty and import VAT.

Is DDU still an Incoterm I can use?

Not under the current rules. DDU (Delivered Duty Unpaid) was removed from the Incoterms rules in 2010, and the nearest current rule is DAP. A contract that names an older edition is still governed by it, but best practice is to use the current one. DAT went too, replaced by DPU in the 2020 edition. If a quote still says DDU, ask the seller to restate it as DAP with a named place and the edition, Incoterms 2020.

Can I use postponed VAT accounting if my supplier ships DDP?

Only if you own the goods at the time of import and are registered for UK VAT, because PVA is limited to VAT-registered owners. Where the UK partner owns the goods at import, it uses PVA and you recover VAT through its invoice. Where a supplier arranges the import for you, HMRC expects you to agree with the supplier how import VAT is handled and to give it your EORI.

Who claims trade agreement preference under DAP and under DDP?

The importer of record: the buyer under DAP, and the UK partner or other declared importer under DDP. The seller's part is supplying a valid proof of origin before shipment. Proofs of origin, the CDS data elements and what the agreement does not change, including import VAT, are covered in the guide to the India-UK trade agreement for importers.

Do the same rules apply to deliveries into Northern Ireland?

No. Northern Ireland follows EU-based customs rules under the Windsor Framework. Only people established in Northern Ireland or the EU can be named as declarant, an XI EORI is normally needed (and requires a GB EORI first), and a non-established importer must use an indirect representative established in Northern Ireland or the EU. Trade agreement preference can also be limited by the 'at risk' test, so treat these consignments separately.

How long should a UK importer keep import records?

Whoever is declared importer keeps the entry file: the buyer under DAP, the UK partner under DDP. VAT records such as postponed VAT statements are kept for at least six years. Origin records for a CETA claim are covered in which records to keep.

Rahul Sharma

Director, BRITBASKET PRIVATE LIMITED

Britbasket exports from India to UK wholesale, retail and foodservice buyers, and has cleared shipments into the UK by air and by sea. Registered in India: CIN U47220HR2025PTC128831, GSTIN 06AANCB2770Q1Z2, IEC AANCB2770Q. About the company

Sources

Last reviewed 6 October 2026. Border, tariff and plant-health rules change. Check the sources above before relying on this guide for a specific consignment.

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