Difference between DAP and DDP.

The information provided here is part of Online Export Import course 


DIFFERENCE BETWEEN DDP and DAP

 

What is the difference between DDP and DAP. Is there any difference between DAP and DDP under Inco terms?

Difference between DAP and DDP copy Let us find out What is DAP and What is DDP  terms used in international business.

How does DAP work in export import trade?

The meaning of DAP means Delivered At Place. DAP is followed by a place. For example, DAP New York means Delivered at Place New York.

I will explain DAP terms of delivery with a simple example. You are a Machinary seller situated near Mumbai, India. The buyer is situated in Newyork. You are the seller of goods and you have contracted with the buyer and agreed to sell the goods on DAP New York price of USD 6050. Here the selling cost of goods is USD 6050 DAP New York. You (the seller) arrange to carry the goods to Mumbai port, meet expenses including customs clearance in Mumbai, pays the ocean freight or airfreight up to New York, appoint a freight forwarder to customs clear the cargo at New York and deliver the goods at the door step of buyer’s place . In other words, as per DAP terms of delivery, all delivery expenses up to the place of buyer's place New York is borne by the seller except duty or tax of importing country.  You can read more about DAP terms here.

 

What is DDP terms in an export Business?

The term DDP means, Delivery Duty Paid or Door delivery Duty Paid. In other words, the selling cost includes all expenses including duty or tax up to the buyer’s place.


I will explain DDP terms of delivery with a simple example. You are a Machinary seller situated near Mumbai, India. The buyer is situated in Newyork. You are the seller of goods and you have contracted with the buyer and agreed to sell the goods on DDP New York price of USD 6250. Here the selling cost of goods is USD 6250 DDP New York. You (the seller) arrange to carry the goods to Mumbai port, meet expenses including customs clearance in Mumbai, pays the ocean freight or airfreight up to New York, appoint a freight forwarder to customs clear the cargo at New York and deliver the goods at the door step of buyer’s place by paying any tax or duty of importing country . In other words, as per DDP terms of delivery, all delivery expenses up to the door step of buyers place in New York is borne by the seller including duty or tax of importing country. In DDP terms, insurance has to be arranged by the seller, as DDP price includes the cost of insurance also.  Click here to read more about Inco Terms DDP.

I hope, I could clarify the difference between DAP and DDP terms with simple example. Did you like this article. Please let me have your opinion below.

 The above information is a part of Export Import Online Tutorial


Other post about import export cauching

 

Difference between C&F/C&I/CIF.

Difference between ex works and FOB

Difference between EGM and shipping bill

What is C& I terms of delivery in export import business?

Difference between DDP and DDU terms of delivery

Difference between Pro forma Invoice and Commercial Invoice in Export Import Trade.

Difference between port of discharge and port of delivery.

 

Excise and Customs - Click here to read complete notification under Budget 2014

 

How to get Export Orders?

 

How to settle dispute in Exports and Imports?

 

Click here to know India Trade Classification(ITC)

 

Pre shipment bank finance to suppliers for exports through other agencies

Types of export containers
Measurement of export containers
Exim Policy of India 2015-20
MEIS, Merchandise Exports from India Scheme
SEIS, Service Exports from India Scheme
Merge your Commercial Invoice and Packing List for all your future exports
Export procedures and documentation

Difference between types of goods and services and types of GST
4 types of Goods and Services in India for GST rate
Difference between IGST on International goods and IGST on domestic goods.
Navigation controls to enroll with GST in India for existing VAT payers in IndiaHow is IGST calculated under Imports?
How is IGST rate on imports treated?
How to register a Digital Signature Certificate under GST in India.GST and e-Commerce Business, FAQ
Definition of E-Commerce under GST
How to identify the steps in enrolment process of a tax payer at the GST common portal. 
TDS under GST, Frequently Asked Questions
Does Interest attract on GST Tax payment delay?
Step by step procedure to login with GST common portal in India
Mechanism of Payment of GST tax in India
Levy of late fee for GST Tax returns filing in India
I pay Service Tax on my services. But I am not sure how do I pay the new GST?
Notice to GST return filing defaulters
When to file Annual Return of GST online?
Procedures to claim reduction in output tax liability of GST in India
Process to issue GST Provisional ID to existing VAT payers in India
Procedures to claim Input Tax Credit under GST in India
When to file first Return of GST tax in India?
GST Tax returns filing – Who, How and When?
Step by step procedures to create username and password in GST common portal

Minimized GST rates on Pots, jars and similar articles under HSN 6909

Reduced GST rate on Table ware, kitchenware, other household articles under HSN 6912

Diminished GST rates on Statues and other ornamental articles

Revised GST rate on Fireworks, rain rockets, fog signals and other pyrotechnic articles

Revised GST rate on Ferro-cerium and other pyrophoric alloys in all forms

Revised GST rate on Anti-knock preparations, oxidation inhibitors for mineral oils

Liability to pay tax, interest or penalty in certain cases, Sec 93 CGST Act 

Section 90 Liability of partners of firm to pay tax, CGST Act, 2017

Liability of agent and principal, Sec 86 of CGST Act, 2017

Provisional attachment to protect revenue in certain cases, Sec 83 of CGST Act, 2017        

Recovery of tax, Section 79 of CGST Act, 2017

Export procedure changes after GST implementation

Factory stuffing procedures after GST implementation

Import of goods attracts IGST but not CVD under GST regime

Import goods attracts IGST and CVD under GST regime

Central Tax Notification No 48 of 2017 dt 18th October, 2017 under GST

Central Tax Notification No 47 of 2017 dt 18th October, 2017 under GST

Union territory tax Notification No. 16 of 2017 DT 13th October, 2017, GST

Integrated Tax Notification No. 11 of 2017 DT 13th October, 2017, GST

 


Comments


khalid shaikh: Excellent demonstration by example above. Kindly add more terms with the same style above.

Mohammad Tamjidzad: I would like to thank you for such a simple and perfect explanation. Best regards M. Tamjidzad

GINNY: We are the importer in Taiwan and our customer (in Taiwan) likes to buy truck from us and de0livery this truck from Germany to France to install the equipment. Then, our customer will import truck from France to Taiwan by themself. We (importer) will sell the truck (made in Germany ) and delivery to France to our customer. What incoterms we should use ? Can we use DDP XXXX FRANCE ? Or any alternative ? And what kind of document we should get from Truck manufacturer (in Germany) ? Invoice + packing list + Cargo Receipt (?). It only needs land transport. Looking forward to receving your reply by return. Thanks in advance. Best regards/Ginny

Kevin Hung : Very helpful and easy to understood. thank you.

Lin Min: Thanks for your Explanation .I wonders now is CIF and DDP is whether same or not .What is the main difference things.

Susan : Hi, Wanna to know is the DDP in USA included State Sales Tax in USA? Appreciate your reply.

Bob: A supplier is claiming they can not supply on DAP terms if payment terms are based on B/L date. I feel these are unrelated but I wanted to check. Any insights?

Veeravenkatarao Ankem: Very useful to new importers

Mahesh Bhavsar: Who has to bear insurance charges in DAT Terms?

ROBERT JOSEPH: Very useful and clear explanation with examples. Thank you.

Fahad: Excellent article. Thanks a lot.

Jino Prasad: Excellent Explanations and briefing with good and simple examples; Really very useful and continue with lot. Thank you

Sky: Very Use Full Thanks

alyn: I'm the buyer that has agreed that the seller will arrange the international shipment to the mentioned address and the freight cost will be added on top of the goods cost in the invoice. it means that the buyer who is actually paying for the freight cost. but in the contract they put it as DAP. does DAP is the correct term for this situation?

Vishal: You have very clearly addressed the difference between DAP and DDP. This information is very useful and very helpful to Exporters. Thank you.

LMM: We are a mexican company based in Mexico City and have a purchase with an american company (Tulsa). How does an equipment bought (certain part of this Purchase order) in Mexico may be delivered if we are using DAP? Does it have to go to the border to pay taxes and then reimported in Mexico?

Kamran Khan : I am a regulare reader of your portal and I am situated in Mumbai and currently got a placement in a logistic freight forwarding company in Import department. I am actually finding bit difficulty in understand the DDP, DAP, EXW shipment step by step procedure to follow . While handling such shipments.

Ashish: Dear Sir, As per my knowledge Duty drawback is always on FOB value and Import duty is always on CIF value. So in this case if I want to do business on DDP terms how should I make Invoice ? Can I make one invoice with breaking all the cost like FOB , CIF and DDP ? Because I have to take Drawback on FOB value and I have to pay import duy on behalf of customer on CIF value since my term of doing business is DDP. but by simply mentioning DDP cost in Invoice I will take high duty drawback and will pay high import duty since my total cost includes considerable part of Door delivery cost.

David Joseph.: Surely yet it is simple and clear to understand.Good instructor. Keep it to knowledge many.

Swathi: nice explanation with example ...

Discussion Forum

You can also share your thoughts about this article.
Any one can answer on question posted by Readers