Project Description
Ultimate Guide on How to Import Into Canada
Welcome to the “Ultimate Guide on How to Import into Canada.” This guide will walk you through step-by-step on how to clear customs, how to calculate Canadian duty, and how to find a Canadian Customs Broker.
How to Import into Canada
Step 1. Get Ready to Import into Canada
Importing into Canada does not need to be difficult but does require a bit of preparation on the importers end. Before you make your first purchase overseas, complete these easy tasks.
Obtain a Business Number and Register for an Import-Export Program Account
Obtaining a business number is free and can be completed easily online. Complete the Canadian Business Number Application here. For more information about Import-Export Program Accounts and registering your businesses number contact GHY or visit the Canada Revenue Agency website.
Information Needed to Obtain a Business Number and Import-Export Program Account:
Personal information
- last name
- social insurance number (SIN)*
- date of birth
- personal postal code (where you live)
Basic business information
- business name
- business number (if this business already has one)
- type of business or organization
- name and SIN* of owners as required
- physical address
- mailing address (if different from the physical address)
- description of major business activity
Import-Export Program Account information
- type of program (importer & exporter, importer only, exporter only)
- physical address
- mailing address
*Canadian Residents Only
Find a Canadian Customer Broker
Considering the constant changes in trade regulations in Canada and around the world, picking the right broker is imperative to your success in importing into Canada. The right broker will help you accurately classify your goods, calculate your duty in Canada, and be a guide through the customs process.
Experience
With over 5,300 ways to classify your goods and nearly 1200 Canadian ports of entry, choosing a broker with experience is vital to the success of your business. Choosing a brokerage that has the background to support you through the process with save you time, money, and headaches.
Compliance
A compliant broker safeguards their clients’ processes to protect them against costly financial penalties. Finding a brokerage that focuses on the quality of its entries ensures your business won’t be faced with unexpected penalties and fines.
Integrity
You need an honest broker that consistently does the right thing for your business, financially and morally. This should include proactive compliance with CBSA, clear communication, and doing what they say they’re going to do.
Support
International trade never sleeps and neither should your broker! Your business needs support 24/7 and your broker should be available to assist with your shipment when you need it.
Step 2. Calculate Your Canadian Customs Duty
After you have obtained a business number, import-export account, and chosen the right broker, the next step is to calculate the Canadian Customs Duty you will owe on the goods to plan to import. Canada uses Harmonized System (HS) codes, a 6-digit standardized method of classifying goods traded internationally, to determine import duties. In addition to the 6-digit international classification, Canada uses 4 additional digits to establish duty rates, a 2-digit tariff item, and a 2-digit statistical suffix. Every importer has the right to classify its own imports but the use of a broker helps to ensure that your goods are classified correctly the first time.
Once the correct tariff classification is established, the next step is to determine if the goods being imported are subject to any trade agreement or special tariff provisions. The requirements of these agreements and provisions vary by country of origin and composition of materials. In addition to meeting all of the requirements of the individual trade agreement or tariff treatment, proof of origin may be required at the time of import. In addition to duty, most goods imported are subject to a 5% Goods and Services Tax (GST) and could also be subject to excise tax or excise duty.
Your Canadian Customs Broker can be a huge help in navigating the complex waters of determining what your import duties and taxes may be. It’s important to remember that accurately classifying your goods before they are imported is the best way to ensure you are not surprised by high unexpected costs and delays.
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Step 3. Purchase your Goods & Arrange Shipping
You’ve established your import business with the Canada Revenue Agency (CRA), chosen an experienced broker, and worked with your broker to estimate your duties and taxes, it’s time to make a purchase and arrange shipping. Foreign suppliers often use International Commercial Terms, more commonly referred to as incoterms, to establish the responsibilities of the buyer and seller in the purchase and who will be responsible for items such as shipping and insurance.
Common incoterms used are Freight on Board (FOB), ExWorks (EXW), and Cost, Insurance, Freight (CIF). In all of these cases, it is the importer’s responsibility to arrange Canadian Customs Clearance and domestic freight. In addition, ocean/air freight, insurance, as well as other costs & arrangements may be required to be completed by the importer.
There is no right answer to the best terms for you or the seller. What’s important is that you understand what parts of the process you are responsible for and when you take ownership of the goods. This ensures that goods are not left accruing fees while you wait to arrange domestic trucking or rail.
Step 4. Clear Your Shipment
Your goods are nearly to Canada and it’s time to clear customs and pay your duties and taxes. Your customs broker is ready to step in to complete all of the necessary forms and documents to get your goods released. To make sure that this process goes smoothly it is important that any additional information requested by your broker is provided quickly. This may include items such as origin of goods documentation, commercial invoices, bill of lading, and shippers export declaration. If you have questions about the documents you need, ask your broker. They are there to assist you and can help answer all of your questions.
Step 5. Receive Your Goods
With the help of your broker, your goods have been released by CBSA and are on their way. You are officially an importer.
Confidently Import into Canada
Importing into Canada can seem overwhelming. By taking the time to prepare, following these 5-easy steps, and partnering with the right Canadian Customs Broker, you can be confident that your goods will arrive without unexpected costs or delays.
How to Import into Canada Infographic
