CARM and the Commercial Accounting DeclarationDuring next year’s CARM Release 2, the current accounting documents used by CBSA will be replaced by a single new declaration.
The B2 and B3 System
The current accounting documents are the CBSA B3 (Customs Coding) and B2 (Request for Adjustment) forms. If you’ve ever self-declared a shipment in person, you will have filled out a B3.
Usually for commercial shipments a completed B3 is generated by the customs broker when the goods are declared to customs. A B2 form is used to adjust a declaration after release. If an error is discovered in the accounting of a shipment after final accounting has taken place, the importer or their agent (usually a customs broker) submits a completed B2 form along with a document package to CBSA to request an adjustment.
What is a CAD?
The Commercial Accounting Declaration (CAD) will be introduced at CARM Release 2 in Spring 2022, and will replace both the B2 and B3 accounting documents.
The CAD is a digital document that can be used to both account for imported goods and request an adjustment. This creates a record of all the adjustments a declaration has undergone by maintaining the history of the document. This will streamline the importing and adjustment processes and make record keeping less cumbersome. It will also make the process of adjusting an existing entry easier and faster.
The CAD can only be accessed through the CCP by the importer or an authorized third party, such as a customs broker, who has been delegated access. For more information about CCP account management, see our resource guide.
How Will the CAD Process Work?
The CAD can be submitted and adjusted using either the CARM Client Portal (CCP) or the Electronic Data Interchange (EDI), which is the system most customs brokers currently use. Information will be provided to customs by either an importer or their authorized agent, and CARM will use that information to automatically calculate duties and taxes.
When the CAD is initially submitted it is assigned a transaction number and that number will remain on the entry regardless of how many revisions the entry undergoes. This means that all versions of the CAD are recorded in the transaction history, in case the importer is audited.
After CARM Release 2, much of the release process will remain the same. When goods are imported, the importer or their customs broker will submit data to CBSA. This is usually done before the arrival of the goods, but for Low-Value Courier Shipments or goods that have been moved to bonded warehouses inside Canada, this is done after the goods have arrived at their destination. CBSA reviews the data and decides whether to release the goods. CARM is updated with the release date, which allows the CARM system to track when the CAD is due. For high and low-value shipments, the CAD is due within five business days of the release date.
For more information about billing cycles, see our blog. The CAD must then be submitted to CBSA within the designated time frame, by either the importer or their customs broker. Once it has been submitted, the CAD will be posted to the importer’s CCP and any party with access can then view the entry or request an adjustment. CBSA will calculate the duties and taxes owing based on the information submitted in the CAD and that amount will be posted on the importer’s accounts receivable ledger in the CCP.
So What’s Going to Change?
If you’re an importer, you will have greater visibility and access to your shipments through the CCP, even if they are submitted by your customs broker. A customs broker with designated access through the CCP will still be able to take the lead in managing most of the clearance process: they can declare an entry to customs, submit the CAD and let you know how much is owing on the shipment.
The CAD allows importers to decide how directly they want to be involved in their own customs clearances and accounting. CARM offers importers the flexibility to be as hands-on or hands-off as they prefer.
By Robin Smith, M.A., CCS
– Robin is a trade industry professional based in Victoria, BC.
During next year’s CARM Release 2, the current accounting documents used by CBSA will be replaced by a single new declaration.
The B2 and B3 System
The current accounting documents are the CBSA B3 (Customs Coding) and B2 (Request for Adjustment) forms. If you’ve ever self-declared a shipment in person, you will have filled out a B3.
Usually for commercial shipments a completed B3 is generated by the customs broker when the goods are declared to customs. A B2 form is used to adjust a declaration after release. If an error is discovered in the accounting of a shipment after final accounting has taken place, the importer or their agent (usually a customs broker) submits a completed B2 form along with a document package to CBSA to request an adjustment.
What is a CAD?
The Commercial Accounting Declaration (CAD) will be introduced at CARM Release 2 in Spring 2022, and will replace both the B2 and B3 accounting documents.
The CAD is a digital document that can be used to both account for imported goods and request an adjustment. This creates a record of all the adjustments a declaration has undergone by maintaining the history of the document. This will streamline the importing and adjustment processes and make record keeping less cumbersome. It will also make the process of adjusting an existing entry easier and faster.
The CAD can only be accessed through the CCP by the importer or an authorized third party, such as a customs broker, who has been delegated access. For more information about CCP account management, see our resource guide.
How Will the CAD Process Work?
The CAD can be submitted and adjusted using either the CARM Client Portal (CCP) or the Electronic Data Interchange (EDI), which is the system most customs brokers currently use. Information will be provided to customs by either an importer or their authorized agent, and CARM will use that information to automatically calculate duties and taxes.
When the CAD is initially submitted it is assigned a transaction number and that number will remain on the entry regardless of how many revisions the entry undergoes. This means that all versions of the CAD are recorded in the transaction history, in case the importer is audited.
After CARM Release 2, much of the release process will remain the same. When goods are imported, the importer or their customs broker will submit data to CBSA. This is usually done before the arrival of the goods, but for Low-Value Courier Shipments or goods that have been moved to bonded warehouses inside Canada, this is done after the goods have arrived at their destination. CBSA reviews the data and decides whether to release the goods. CARM is updated with the release date, which allows the CARM system to track when the CAD is due. For high and low-value shipments, the CAD is due within five business days of the release date.
For more information about billing cycles, see our blog. The CAD must then be submitted to CBSA within the designated time frame, by either the importer or their customs broker. Once it has been submitted, the CAD will be posted to the importer’s CCP and any party with access can then view the entry or request an adjustment. CBSA will calculate the duties and taxes owing based on the information submitted in the CAD and that amount will be posted on the importer’s accounts receivable ledger in the CCP.
So What’s Going to Change?
If you’re an importer, you will have greater visibility and access to your shipments through the CCP, even if they are submitted by your customs broker. A customs broker with designated access through the CCP will still be able to take the lead in managing most of the clearance process: they can declare an entry to customs, submit the CAD and let you know how much is owing on the shipment.
The CAD allows importers to decide how directly they want to be involved in their own customs clearances and accounting. CARM offers importers the flexibility to be as hands-on or hands-off as they prefer.
By Robin Smith, M.A., CCS
– Robin is a trade industry professional based in Victoria, BC.
