Importing goods into Canada can be a difficult process. Fortunately, there are many resources available to make the process easier. Here are 8 questions to ask yourself before you begin importing goods into Canada.
Do I need a business number?
All businesses and individuals need to obtain a business number before importing commercial goods into Canada. Registering a business number with the Canadian Revenue Agency (CRA) will allow you to register for an import/export tax account. An import/export account is free of charge and can be obtained quickly.
While registering for an import/export account, you should also register for your GST/HST tax account. GST is payable on most goods at the time of importation.
Do I have enough information about the goods I’m importing?
You need to make sure your goods are permissible into Canada. You will need to gather as much information as possible about the goods you intend on importing. Certain products may require additional documentation, such as permits or licenses. You can follow this guide from the CSBA to find out if the goods you’re wanting to import are restricted in any way, or if they need any additional documentation.
How much will my duties and taxes be?
In order to accurately calculate your duties and taxes, you will need:
- The tariff classification of the goods
- The applicable tariff agreement
- Rates of duty
- Tax payable when importing goods
A tariff classification is a 10 digit number used to determine the rate of duty payable when importing goods. The CSBA Customs Tariff guide has both of these figures.
The “tax payable when importing goods” refers to GST, excise tax, and excise duty.
For imported goods, you only pay the federal portion (GST) of taxes even if you reside in a province that charges HST. GST will not be charged to goods that are considered “zero-rated”, such as prescription drugs and medical devices.
Should I get a customs broker?
The next question to ask yourself is: should I get a customs broker? Many businesses hire a customs broker to help facilitate the process of importing goods into Canada. A customs broker will obtain and prepare the customs release paperwork needed by the CSBA, arrange payments, and secure the release of imported goods.
What are some things my Exporter will need to prepare?
After placing your order with your exporter, they are then responsible for getting the documentation together for importing the goods to Canada. Your exporter will need to prepare:
- Packing list (description of the goods in detail)
- Bill of Lading: issued by the exporter to a carrier. This describes the goods being shipped, acknowledges their receipt, and sets out the contract for the goods’ transport.
- Commercial invoice (what you pay the exporter)
- Canada Customs Invoice
- Certificates of Origin
These documents will be prepared by the exporter and given to the carrier. If the value of your shipment is less than $2,500 Canadian dollars, you don’t need a separate Canada Customs Invoice.
Who is responsible for preparing the Cargo Control Document?
Your chosen cargo carrier is responsible for preparing the Cargo Control Document. This document may also be referred to as a waybill or manifest. It’s prepared from the exporter’s bill of lading and is used to report the shipment to the CSBA. The documents can also be reported through the Electronic Data Interchange (EDI).
Which documents do I need in order to have my goods released by customs?
In order to have your goods released, you will either have to:
- Present a full accounting and pay duties all at once
- Have your goods released prior to the payment of duties
You will also need:
- Two copies of the Cargo Control Document
- Two copies of the Canada Customs Invoice (or the commercial invoice that contains the information)
- A paper copy of all import permits, certificates, licenses, or required documents from other government departments and agencies, or an electronic copy for EDI participants with other government departments.
How long should I keep my records pertaining to this import?
You should keep your records for six years following the importation of commercial goods.
Our team is always available to help you with your import. Reach out today for a quote on our customs broker service.