What an Order from China Actually Costs to Land in Australia: A Worked AUD Landed-Cost Model
Landed-Cost Model
What an Order from China Actually Costs to Land in Australia: a worked AUD landed-cost model
The full arithmetic on one order, line by line in AUD — duty, GST and border charges, sourced from ABF and ATO rates so you can rerun it with your own figures.
In short: on an A$18,000 order with A$1,900 of freight, you fund roughly A$2,200 at the border if the goods are duty-free, or roughly A$3,200 at a 5% duty rate — and about A$2,000 of that is GST you recover later if you are registered for GST.
Almost every comparison of Alibaba versus a sourcing agent argues about the unit price. The unit price is the part you can already see. The costs that decide whether an order was a good one arrive later, at the Australian border, and most of them are calculated from numbers you chose months earlier.
Here is the full arithmetic on one order. Run it with your own figures — that is what it is for.
The worked example
These are illustrative, not a quote. A 500-unit custom product, shipped by sea, LCL. Goods invoiced at a customs value of A$18,000 after conversion at the exchange rate applying on the day of export. International freight and insurance of A$1,900. Import Declaration lodged electronically. The importer is registered for GST. Charges current as at 1 July 2026. The Import Processing Charge and the biosecurity charge are set by the Australian Government and are revised from time to time — confirm current rates with the ABF and DAFF before relying on this for a live order.
Step 1 — Customs value. A$18,000. This is the price of the goods themselves. It excludes international freight and insurance.
Step 2 — Duty. This is the line you must look up for your own product; it depends on the tariff classification of what you are importing. Goods of Chinese origin may qualify for a preferential rate under the China–Australia Free Trade Agreement, but only where valid origin documentation is supplied with the entry. Because the rate varies, the example below runs two scenarios.
Step 3 — The value of the taxable importation (VoTI). This is the number GST is calculated on, and it is where most importers get it wrong. Per the ABF, the VoTI is the sum of:
Freight and insurance are inside the GST base. So are duties. Duty is taxed.
Step 4 — GST. 10% of the VoTI.
Step 5 — Border charges. An electronic Import Declaration costs $152.00 for a consignment of $10,000 or more, or $50.00 for one over $1,000 but under $10,000. A consignment of $1,000 or less costs $0.00. Lodging on paper rather than electronically costs $192.00 and $90.00 respectively. A biosecurity Full Import Declaration charge also applies to consignments over $1,000: $71.00 by sea, $48.00 by air.
The two scenarios, side by side
| Line | Duty-free entry (A$) | Duty at 5% (A$) |
|---|---|---|
| Customs value | Duty-free entry18,000.00 | Duty at 5%18,000.00 |
| Duty | Duty-free entry0.00 | Duty at 5%900.00 |
| Transport and insurance | Duty-free entry1,900.00 | Duty at 5%1,900.00 |
| Value of the taxable importation | Duty-free entry19,900.00 | Duty at 5%20,800.00 |
| GST at 10% of VoTI | Duty-free entry1,990.00 | Duty at 5%2,080.00 |
| Import Processing Charge (electronic, ≥$10,000) | Duty-free entry152.00 | Duty at 5%152.00 |
| Biosecurity FID charge (sea) | Duty-free entry71.00 | Duty at 5%71.00 |
| Payable at the border (duty + GST + charges) | Duty-free entry2,213.00 | Duty at 5%3,203.00 |
| Total landed cost | Duty-free entry22,113.00 | Duty at 5%23,103.00 |
| Less GST recoverable on your BAS | Duty-free entry−1,990.00 | Duty at 5%−2,080.00 |
| Net cost to the business | Duty-free entry20,123.00 | Duty at 5%21,023.00 |
Three things that table shows that a unit price never will
1. A 5% duty line costs 5.5% at the border. The duty is $900, but because duty sits inside the VoTI, it also adds $90 of GST. The gap between the two columns is $990, not $900 — every dollar of duty is taxed on the way through. If you are registered for GST you recover that $90, so the difference settles at $900 once your BAS is lodged. You still fund $990 at the border.
2. On this order, the origin documentation is worth $900. That is the entire difference between the columns once the GST washes out — $990 at the border. Not a negotiation, not a better unit price — a document, correctly prepared, lodged with the entry. It is the single highest-return piece of paperwork in the transaction, and it is the one most often left to the supplier to handle.
3. Freight is taxed. The A$1,900 of freight and insurance adds A$190 to the GST bill, because it sits inside the VoTI. Registered for GST, you recover that $190 — but you fund it at the border first, so a freight saving is worth 10% more to your cash position than the quote itself suggests.
The GST is a cash-flow event, not a cost
If you are registered for GST, you generally recover the A$1,990 through your BAS. It is not a cost of importing — but you fund it at the border, weeks or months before you recover it, on top of already having paid the factory.
For a business ordering repeatedly, that timing gap is often the real constraint, not the margin.
The ABF operates a Deferred GST Scheme for importers approved for it. Instead of paying GST at the time of clearance, the liability is reported to the ATO, appears on your Business Activity Statement, and is settled there. For an importer running consecutive shipments, that can be the difference between funding one order and funding two. It is worth asking your accountant whether you qualify — most people who would benefit have never heard of it.
Under A$1,000 the rules are different — and consolidation changes them
Goods with a customs value of A$1,000 or less are treated differently. Since 1 July 2018, GST on those is collected by the overseas seller or the platform at the point of sale, rather than at the border. There is no Import Declaration and no Import Processing Charge.
There is a catch that matters specifically if you are consolidating. Where a number of low value goods are shipped as one consignment with a total customs value over A$1,000, the consignment is treated as being over the threshold — so it clears at the border, with duty, GST and charges applying there.
This is not a reason to avoid consolidation. Consolidating is usually cheaper on freight by a wide margin. It is a reason to know which set of rules your shipment will land under before it ships, because the paperwork, the timing and who holds the GST liability all change.
Reusing this model. The arithmetic above is built from published Australian Border Force, ATO and Department of Agriculture, Fisheries and Forestry rates. You are welcome to reproduce it with attribution to Ocean Port Link and a link to this page. If you quote the figures, quote the date they were current.
