Some Info on Buying Online…“I buy stuff online all the time! Why are they saying I need a customs broker this time??”
As the Christmas season kicks off, and the frantic phone calls start to roll into the King Bros office, here’s what you should know if you’re planning to do your holiday shopping online.
Buying online is so common now that it’s easy to forget that goods coming from outside of Canada need to go through the import process.
Depending on how you shop online, you might be used to the import charges being handled behind the scenes, and it can seem like some shipments are selected at random for extra customs charges. In fact, everything that is imported into Canada goes through the customs process at some point.
When you shop online from the US and you aren’t required to provide a customs broker or declare the goods to customs yourself, it means that the customs process was handled by the party who sold or shipped the goods.
Clearing items through customs involves submitting a declaration to CBSA (The Canada Border Services Agency) and also paying any duties and taxes owing. If you buy goods online from outside Canada, and a customs declaration has not been filed and the customs charges paid by the time your shipment arrives at the border, the carrier bringing it into Canada will contact you as the importer and request that you provide a customs broker.
The broker can then submit the declaration and pay the charges, which they will then bill back to you. Sometimes the shipper will have completed only part of the customs process: For example, if they declared the goods to customs, but did not pay the customs charges, the shipment might be delivered to you along with a bill for unpaid duties and taxes.
Here are some reasons why some of your purchases might arrive with customs charges owing, and others might not:
• First of all, shipments valued under $20 can be imported duty and tax free. Very low-value purchases or gifts still have to be declared to customs, usually on a customs form filled out by the shipper, but no duty or tax is collected.
• If you buy from Amazon.ca, the order might be fulfilled from within Canada. This means that the vendor, even if they are an American company, has imported the goods into Canada to be stored at a fulfillment centre or warehouse. Since the vendor has already gone through the import process and paid the duties and taxes, the process doesn’t need to be repeated when the goods are sold to the customer. However, don’t assume that just because you are buying from a web address ending in “.ca” that the order will be fulfilled from within Canada. When in doubt, check with the seller.
• If you purchase something on Amazon that is not going to be fulfilled from within Canada, Amazon will usually include an import duties deposit in the total when you check out. This is their estimate of how much will be owed to customs. You are charged the amount of their estimate at checkout, and if the actual duty is lower they will refund you the difference. When you check out, you authorize Amazon and the carriers they work with to file the customs declaration, as well as to collect the customs charges and remit them to CBSA on your behalf.
• Big courier companies often have their own customs brokers, so if your goods are delivered to you by a courier such as UPS, Fedex or DHL, they might have done the customs brokerage in-house. Sometimes the customs charges are rolled into the shipping cost, but other times they will have to be handled separately. This is why you will sometimes get a bill for customs charges from the courier when your goods are delivered: the courier company was authorized to set up the customs clearance, but no arrangements were made in advance for how the charges were going to be paid.
• If you purchase from a large company that exports a lot of goods to Canada, they might have a system in place to avoid every single one of their customers having to get a customs broker. A US-based company might register in Canada as a Non-Resident Importer, which means that they act as the legal importer and pay all the customs charges. They also collect the Canadian taxes and remit them back to the Canadian government.
As a general rule, if you purchase something from the USA to be shipped to Canada and you are not charged the Canadian GST, you might be required to pay customs charges. If you aren’t sure, ask the seller before you purchase anything. If the seller doesn’t have any measures in place to deal with the customs charges, as the importer of the goods you will ultimately be responsible for them.
CBSA offers an online duty and tax calculator that you can use to estimate the import costs for a shipment.
It’s worth noting that there is a difference between duties and taxes. Duties are charges levied on specific goods by the Canadian government. Not all goods incur duty, and duty can sometimes be removed if Canada has a free trade agreement with the country that the goods come from. Under the new Canada-US-Mexico Free Trade Agreement, goods shipped to Canada from the US or Mexico that are valued under $150, regardless of where they were manufactured, can be imported duty-free. Goods that are shipped from, and also manufactured in, the US or Mexico are duty-free under $3300, and duty-free over $3300 with a valid certificate of origin. In all of these cases, however, GST and PST/HST still apply.
Foreign vendors who sell goods to Canadians are usually anxious to find ways to minimize the inconvenience of importing for their customers. Bigger companies often already have systems in place to prevent their Canadian customers getting stuck with additional charges and leaving them angry Google reviews, and even smaller sellers will often be happy to work with you on an importing plan that you’re both comfortable with.
Ultimately, however, the legal responsibility for making sure the customs declaration is submitted and customs charges paid lies with the importer within Canada. As the purchaser, you are legally liable for any unpaid duties and taxes. If you’re not sure what customs arrangements are in place, always check with the seller. Ask if they have shipped to Canada before and how they have handled the customs process in the past, and find out if they have their own Canadian customs broker or if you will need to get your own.
And if they don’t have any idea what you’re talking about, maybe keep shopping around.
Any questions? We are always here to help. Contact us here…
By Robin Smith, M.A., CCS
– Robin is a trade industry professional based in Victoria, BC.
“I buy stuff online all the time! Why are they saying I need a customs broker this time??”
As the Christmas season kicks off, and the frantic phone calls start to roll into the King Bros office, here’s what you should know if you’re planning to do your holiday shopping online.
Buying online is so common now that it’s easy to forget that goods coming from outside of Canada need to go through the import process.
Depending on how you shop online, you might be used to the import charges being handled behind the scenes, and it can seem like some shipments are selected at random for extra customs charges. In fact, everything that is imported into Canada goes through the customs process at some point.
When you shop online from the US and you aren’t required to provide a customs broker or declare the goods to customs yourself, it means that the customs process was handled by the party who sold or shipped the goods.
Clearing items through customs involves submitting a declaration to CBSA (The Canada Border Services Agency) and also paying any duties and taxes owing. If you buy goods online from outside Canada, and a customs declaration has not been filed and the customs charges paid by the time your shipment arrives at the border, the carrier bringing it into Canada will contact you as the importer and request that you provide a customs broker.
The broker can then submit the declaration and pay the charges, which they will then bill back to you. Sometimes the shipper will have completed only part of the customs process: For example, if they declared the goods to customs, but did not pay the customs charges, the shipment might be delivered to you along with a bill for unpaid duties and taxes.
Here are some reasons why some of your purchases might arrive with customs charges owing, and others might not:
• First of all, shipments valued under $20 can be imported duty and tax free. Very low-value purchases or gifts still have to be declared to customs, usually on a customs form filled out by the shipper, but no duty or tax is collected.
• If you buy from Amazon.ca, the order might be fulfilled from within Canada. This means that the vendor, even if they are an American company, has imported the goods into Canada to be stored at a fulfillment centre or warehouse. Since the vendor has already gone through the import process and paid the duties and taxes, the process doesn’t need to be repeated when the goods are sold to the customer. However, don’t assume that just because you are buying from a web address ending in “.ca” that the order will be fulfilled from within Canada. When in doubt, check with the seller.
• If you purchase something on Amazon that is not going to be fulfilled from within Canada, Amazon will usually include an import duties deposit in the total when you check out. This is their estimate of how much will be owed to customs. You are charged the amount of their estimate at checkout, and if the actual duty is lower they will refund you the difference. When you check out, you authorize Amazon and the carriers they work with to file the customs declaration, as well as to collect the customs charges and remit them to CBSA on your behalf.
• Big courier companies often have their own customs brokers, so if your goods are delivered to you by a courier such as UPS, Fedex or DHL, they might have done the customs brokerage in-house. Sometimes the customs charges are rolled into the shipping cost, but other times they will have to be handled separately. This is why you will sometimes get a bill for customs charges from the courier when your goods are delivered: the courier company was authorized to set up the customs clearance, but no arrangements were made in advance for how the charges were going to be paid.
• If you purchase from a large company that exports a lot of goods to Canada, they might have a system in place to avoid every single one of their customers having to get a customs broker. A US-based company might register in Canada as a Non-Resident Importer, which means that they act as the legal importer and pay all the customs charges. They also collect the Canadian taxes and remit them back to the Canadian government.
As a general rule, if you purchase something from the USA to be shipped to Canada and you are not charged the Canadian GST, you might be required to pay customs charges. If you aren’t sure, ask the seller before you purchase anything. If the seller doesn’t have any measures in place to deal with the customs charges, as the importer of the goods you will ultimately be responsible for them.
CBSA offers an online duty and tax calculator that you can use to estimate the import costs for a shipment.
It’s worth noting that there is a difference between duties and taxes. Duties are charges levied on specific goods by the Canadian government. Not all goods incur duty, and duty can sometimes be removed if Canada has a free trade agreement with the country that the goods come from. Under the new Canada-US-Mexico Free Trade Agreement, goods shipped to Canada from the US or Mexico that are valued under $150, regardless of where they were manufactured, can be imported duty-free. Goods that are shipped from, and also manufactured in, the US or Mexico are duty-free under $3300, and duty-free over $3300 with a valid certificate of origin. In all of these cases, however, GST and PST/HST still apply.
Foreign vendors who sell goods to Canadians are usually anxious to find ways to minimize the inconvenience of importing for their customers. Bigger companies often already have systems in place to prevent their Canadian customers getting stuck with additional charges and leaving them angry Google reviews, and even smaller sellers will often be happy to work with you on an importing plan that you’re both comfortable with.
Ultimately, however, the legal responsibility for making sure the customs declaration is submitted and customs charges paid lies with the importer within Canada. As the purchaser, you are legally liable for any unpaid duties and taxes. If you’re not sure what customs arrangements are in place, always check with the seller. Ask if they have shipped to Canada before and how they have handled the customs process in the past, and find out if they have their own Canadian customs broker or if you will need to get your own.
And if they don’t have any idea what you’re talking about, maybe keep shopping around.
Any questions? We are always here to help. Contact us here…
By Robin Smith, M.A., CCS
– Robin is a trade industry professional based in Victoria, BC.
