DDP vs PDDP: What’s the difference and why it matters

When you’re selling or buying across borders, the terms around shipping, duties and taxes can get messy fast. Two acronyms you’ll see a lot are DDP (Delivered Duty Paid) and PDDP (Postal Delivered Duties Paid). This article breaks them down and specifically what they mean in a UK context, with a focus on how the Royal Mail handles things, although many UK carriers provide a similar function. If you're shipping via a carrier such as Royal Mail from NetSuite or Shopify, or any ERP/ecommerce platform, you'll want to get this right or face rightfully annoyed customers.

TL;DR

DDP = duty paid by seller, PDDP = duty paid via the carrier (i.e, Royal Mail) by sender, and both are designed so the recipient is done with surprises. Get this right, and everyone’s happier.

What is DDP (Delivered Duty Paid)?

At its core: the seller takes responsibility for all costs and risks of delivering the goods to the buyer’s destination, including duties, taxes and customs clearance. The buyer receives the goods and pays nothing further.

In practical UK e-commerce terms: if you’re a UK retailer shipping abroad and you quote DDP, you are saying to your customer: Here’s the price. You don’t need to worry about extra fees when it lands.

What is PDDP (Postal Delivered Duties Paid)?

PDDP is essentially a variant of DDP but tailored for parcel/post networks, used when shipping via a postal operator rather than freight-only channels. In our UK context: Royal Mail offers a PDDP service so that UK sellers (or overseas sellers into the UK) can arrange duties/taxes to be paid in advance via the postal network, so the recipient doesn’t get hit with a bill on delivery. The outcome is similar to DDP (net cost to recipient zero surprise), but the route is via Royal Mail’s postal infrastructure rather than freight/air-cargo specialists.

Key difference between DDP and PDDP in short

• DDP = Seller covers everything (shipping, customs, duties) until delivery.
• PDDP = The same outcome (no surprise cost to recipient) but framed around parcel/post carriers (in the UK: Royal Mail) instead of broader freight logistics.
  
  So you might think of PDDP as DDP handled my carrier.

What it means for UK Retailers

The advantages

• Offering DDP/PDDP = you make things simpler for your international customers, which helps conversion and builds trust. No oops you owe more moment.
• Using Royal Mail’s PDDP service means you can collect the full landed cost at checkout (including duties/VAT) and deliver so the end-customer pays nothing unexpected. That’s very positive from a customer experience standpoint.
• You get better clarity of cost and margin if you price for landed cost and have a reliable shipping & customs partner.
• For UK sellers post-Brexit: duties and customs have become more visible and complex. Offering a duties taken care of model simplifies the buyer’s decision.

The risks / things to watch

• With DDP you (the seller) carry the risk. If you mis-estimate duties, taxes or customs fees you might lose margin or face unforeseen costs.
• Implementing PDDP means you must accurately capture customs data (HS codes, values, origin, tariff classification) and pick the correct Royal Mail service code. Mistakes mean the parcel may be flagged as DDU (duties unpaid) or get held/delayed.
• Not all destinations may be covered by Royal Mail’s PDDP service yet, so you’ll need to check supported countries.
• You may need to build the duties/VAT cost into your pricing strategy which can raise your apparent price or lower margin. You’ll need to decide whether to absorb it or pass it to the buyer.

Royal Mail-specific points for retailers

• If you’re shipping internationally from the UK and using Royal Mail’s PDDP product, you must choose the correct service prefix/code (Royal Mail calls them things like MPR, MTV, BYD etc for PDDP).
• After shipping, Royal Mail will invoice you (the sender) for the duties/VAT and a handling fee per item (Royal Mail publishing says ~50p per item) once the overseas customs authority has assessed the duty.
• Make sure your website checkout clearly states duties & taxes included (or equivalent) when you are offering DDP/PDDP so customers know there are no hidden costs.
• For UK-to-USA shipping: Royal Mail have been expanding their PDDP offering to cover the USA (and other destinations) recognising the duty/de-minimis changes. It’s worth checking the latest service-coverage updates.

What it means for UK Consumers

The good news

• If a seller offers DDP or PDDP and they’ve done their job properly: you pay the price you see at checkout, wait for delivery, and you don’t get hit by a surprise duties/taxes bill.
• Parcels are more likely to clear customs quickly and reach you without extra delay (because duties/taxes were pre-handled).
• Transparent pricing means no nasty surprises at your door.

What you need to watch

• Sometimes sellers quote a cheap price but then the parcel arrives and you owe duties/taxes, if price was DDU (Delivered Duty Unpaid) rather than DDP/PDDP. Always check.
• You may pay a bit more upfront (because duties/taxes are built-in) but you’re paying for certainty.
• If something goes wrong (e.g., parcel lost or returned, duties pre-paid by seller) you may find refund/return resolution is more complex.

Royal Mail-specific for consumers

• If you’re buying from overseas into the UK and the seller uses Royal Mail PDDP: you should arrive at no extra cost. The seller or their shipping provider paid the duties/taxes in advance via Royal Mail’s service.
• If you’re in the UK buying from an overseas retailer, check if the shipping message says duties paid or duties unpaid. If unpaid, you may receive a call or card from Royal Mail or customs asking for payment.
• If the parcel shows as shipped via a Royal Mail PDDP code/service: it means the sender intended to handle duties ahead of you being charged. If you still get asked for duties: you should query with the sender and Royal Mail/your local customs agent.

Final word

If you’re a UK retailer selling internationally, offering DDP (or using Royal Mail’s PDDP for parcels) is a strong step towards making your buyer’s experience smoother, reducing abandonment, and improving trust. It involves more responsibility on your part, pricing correctly, handling customs data, choosing the right shipping service... but the payoff is meaningful.

If you’re a UK consumer buying from abroad (or selling to overseas), always check whether the shipping terms are DDP/PDDP or not. If they are, perfect! If they’re not, you might be walking into extra charges at the door.