When goods are imported through customs, the payable duty amount is typically calculated using purchase price + transport costs. Other costs could also be taken into consideration such as insurance, royalties, brokerage fees etc. The costs that are taken into consideration will be determined by the country/region the goods are being imported to.

In the UK, customs will calculate the payable duty amount using the CIF (cost, insurance, freight) value of the goods and the duty % determined by the exporting country and commodity code for the item. The duty calculation must also be completed in the local currency, therefore exchange rates must be applied if the transactions are in a foreign currency.

The calculation would be as follows:

• Payable duty = (cost of goods + cost of insurance + cost of freight) x duty %.
• For example: (£9000 + £200 + £800) x 2 % = £200

It is not possible to configure auto costs in the landed cost module to perform this calculation. Functionality does exist to link auto costs together, but you can only link auto costs within the same auto cost record. For example, you cannot link the duty cost on the item cost area to the freight cost on the shipping container cost area.

Microsoft has previously suggested a workaround by configuring a duty cost on the item cost area and a second duty cost on the shipping container cost area that is linked to the freight cost. However, this is not realistic as a shipping container could have a mixture of items with different duty % rates. The duty cost estimate on POs/Voyages would be inaccurate.

In addition to duty there will be other costs such as anti-dumping duty that also need to be linked to other costs to accurately calculate the cost estimate. Auto costs must be enhanced with new functionality that can create accurate cost estimates per PO/Voyage for these scenarios. The system has the data to complete the calculations but lacks the functionality/logic to do so.