ParcelPedia Podcast

Tax IDs and Navigating the 2025 International Shipping Maze

• James Banks • Episode 42

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 What Are The New 2025 International Shipping Rules, Tax IDs?

The shipping landscape has dramatically shifted for 2025, with new tax ID requirements reshaping how businesses handle international deliveries. ParcelPedia owner James Banks unpacks these critical changes, focusing on how they'll affect shipments to our closest neighbors—Mexico and Canada.

At the heart of these new regulations is the mandatory inclusion of tax identification numbers for international shipments. While these IDs have always existed (like EINs for businesses or social security numbers for individuals), they're now required elements for successful delivery. The stakes are high: without proper tax ID verification, your package won't simply be returned—it might be held indefinitely in the destination country, creating a frustrating limbo where neither sender nor recipient can access the shipment.

Mexican shipments face additional hurdles with the elimination of the previous $800 de minimis exemption. This means Mexican recipients will now pay VAT taxes on nearly all incoming goods, significantly increasing costs for the receiver. James suggests practical workarounds like shipping smaller batches or starting holiday shipments earlier to minimize the financial impact. For businesses regularly shipping across borders, these changes demand immediate attention and strategy adjustments.

Requesting tax IDs might feel awkward, but James offers practical advice for having these conversations with recipients, including directing them to official carrier guidelines that validate these requirements. The days of simply writing "GIFTS" on customs forms are long gone, replaced by stringent verification processes that continue to evolve. Visit online for resource links or stop by our Frisco store to discuss your specific shipping needs. Mention the podcast for 10% off select shipping services and ensure your international packages arrive successfully in this new regulatory environment.

To learn more about ParcelPedia visit:
https://www.ParcelPedia.com
ParcelPedia
8992 Preston Road, Suite 110
Frisco, Texas
972- 335-1450

Speaker 1:

Welcome to the Parcelpedia podcast, the ultimate guide to all things shipping and business services in Frisco, texas, from US mail and FedEx to private mailboxes and packing supplies. We've got you covered. Stay tuned for a special discount code to save on your next order. And now delivering expert tips and insider insights with a smile, here's your host, james Banks. Owner of Parcelpedia.

Speaker 2:

International shipping just got more complicated and more important. James breaks down what business owners need to know about new tax ID requirements and how to stay compliant in 2025. Welcome back everyone. I'm Sophia Yvette, co-host and producer, back in the studio with owner of Parcelpedia, James Baines. Hi James, How's your weekend so far?

Speaker 3:

Hey Sophia, I've been doing pretty well this weekend Yourself.

Speaker 2:

Pretty good. Thanks for asking, James. Now glad to have you back. Let's dive into today's topic. So, James, what do business owners need to know about the 2025 new international shipping rules, especially when it comes to tax?

Speaker 3:

IDs? Great question. As you stated, it is a new rule for this year, 2025. It's a rule that's been kind of kicked off due to not just US but mainly US's push to kind of getting some more tax revenue through tariffs, and so it has adjusted some things and it's trying to tighten, I guess, the security as far as well as far as shipments going back and forth across the country lines. So, yeah, as far as what you need to know when shipping internationally, the tax IDs, it's a huge thing, so this is not a new system. As far as what you need to know when shipping internationally, the tax IDs, it's a huge thing, so this is not a new system.

Speaker 3:

As far as how the countries go, these are tax IDs that are preexisting. They're already there for business owners. They would know they would see that as like their EIN for their business. As an individual, you'd be using, like on the state side of these, you'd be using something like your social security number. But the countries that we're seeing it the most with as far as really really strict on the compliance is Mexico and Canada. So, of course, with them being our neighboring countries, they are most often shipped to countries, and so that's why I just wanted to bring attention to the matter because it is definitely something that is going to affect shipments going forward, and so just to kind of dive deep into that a little bit, the tax ID again is just a number associated with each individual citizen of that country and it's just a number that they're going to want to have as a further proof of identity.

Speaker 3:

So typically, when you're shipping an international shipment, your recipient, when they are picking it up or it's being delivered to them, typically they need to provide some type of proof of ID. A lot of times it's like through a text message or a portal, or it could be at the actual door when the package has been delivered. You know, driver asked for an ID, and so what this is doing is just taking it a step further and it's using your tax ID. So obviously you know with us here in the States if someone were to ask you know, hey, I need your social to verify this. As we know that's a very you know that that is compliance with international guidelines. So when what you need to know when you're shipping is that this is something that's going to be asked for now. So typically, what most people know some of those are familiar.

Speaker 3:

Shipping is going to have your address. You got to have your name and you have a good phone number. If you had an email, that's good, you know, kind of going above and beyond. And now you know it's like a fifth element. Now it's the tax ID. So what I've been telling all my customers when they're shipping or inquiring about shipping again, especially in New Mexico, they're really strict about it is that you want to have that tax ID ready.

Speaker 3:

If it's something where you know you're having trouble communicating with the recipient and you know you're not sure you'll be able to get it from them, it will not actually stop your shipment from moving. However, if the ID cannot be provided on the recipient side, once the package gets there and it's going to be delivered okay, you know we need this ID now then you're going to run into problems. So it's, and you run into problems where we're outside of the norm, where, instead of it being returned back to you, it can be held in that recipient country without being delivered. So not only do you lose your package, but your receiver doesn't ever get it either. It just kind of goes in a limbo, and so that is. You know, when you're talking about international. That's where it gets really sticky, and I am just trying to get ahead of that and prevent that by getting the knowledge out there and letting everyone know the tax ideas are very, very, very important.

Speaker 3:

Some other shipping guidelines or some other shipping changes that are new for this year. The $800 de minimis, or the exemption amount for Mexico, is also gone. So what you and it's not for all items, I believe some medical things are still exempt. However, what used to have is up to $800 USD you are allowed to receive as a Mexican citizen without having to pay a VAT tax or a duty on it. Unfortunately, that is now gone. So one thing to keep in mind as a shipper on the state side is that if you're going to be sending to Mexico, depending on the value of the items you're sending, your recipient is going to be looking at some extra taxes on top of just receiving. So something to keep in mind if you're planning on shipping as far as for top of, you know, just receiving.

Speaker 3:

So something to keep in mind if you're planning on shipping, you know as far as, like for the holidays, you may want to start shipping now, or shipping earlier, or shipping smaller batches, so that you don't have to pay a huge amount of tax, because the tax is assessed based off the total value of the product that is being sent across the country lines. So those things are pretty major. When you think about how it will affect I mean really everything from retail to individual shipping to large bulk shipping for businesses, it's a thing that you need to have in mind and keep an eye on, because this is just the most recent change, but it doesn't mean that it's like it's going to stay this way. There's very good chance that new rules can be added and things of that nature, but definitely starting out that tax ID is just so important and it's going to alleviate a lot of headaches if you can get that even before you ship. So that's just one of my major major tips I want to give out, if you can.

Speaker 3:

You know, if you know you're going to be shipping someone to Mexico especially but it's really any country but Mexico, especially Canada especially ask them hey, I need your tax ID. I know they're going to again for us. If someone were to ask you, hey, I need your social to ship you a greeting card, you'd probably balk at them like, hey, what kind of scam are you running? But you can point them to the guidelines. That's another thing I wanted to mention. Go to our website, vparcelpediacom.

Speaker 3:

You will see hyperlinks, shipping guidelines through for USPS, for DHL and for FedEx. It just shows you what to expect and it can use that as your. You know your resource as well. So they'll ask me like what do you mean? You need my tax ID? What are you talking about about? You can just show them like hey, it's not me, it's everybody. They're asking for this, you know, um, and so, just so you don't scare anyone off and they don't think you're asking for more information than it's necessary, this is very necessary and it's needed. So, again, you can go to the website and see that um, or you can always call us emails if you have questions wow James.

Speaker 2:

Um, this definitely is a certainly a lot of great information for the listeners today. Were there any final words of wisdom on the same subject you wanted to share?

Speaker 3:

You know. Just again, to really harp on the idea that these things are new but they're ever changing. Just call, you know, call ahead, do some, you know, googling if you like. Just keep in mind that these things are never set in stone. I mean, if you look at just years back, you could send hundreds of dollars worth of goods and just write on the invoice gifts, just G-I-F-T-S, that's it, and it would go and your recipient would get it. No problem. That will not fly in today's shipping world. It just won't. So things are always changing. We see it in other aspects of life, like flying on airplanes and things of that nature. So we know how it works, we understand it. It's just one of those things. Just keep an eye on it. And if you don't know, if you're not sure where to look, we're here, Parcelpedia, the experts. You know we can be your source of knowledge. So reach out anytime. We're happy to help and happy to answer any questions you have.

Speaker 2:

Amazing. Well, thanks for breaking that down for us today, James. That's a wrap for today's episode. I'll see you next time.

Speaker 3:

All right, take care.

Speaker 1:

Thanks for joining us on the Parcelpedia podcast. Don't forget mention podcast at our store. To snag 10% off select shipping services, Stop by at 8992 Preston Road, Suite 110, Frisco, Texas, or give us a ring at 972-335-1450. We're here to make your shipping a breeze. Until next time, keep shipping and smiling.