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Shipments entering Canada may require additional documents:

  • The most common is a NAFTA Certificate, note the NAFTA review above, that can be prepared by the manufacturer for each shipment or a blanket certificate can be prepared and kept on file by you, and the importer, but not your broker.

  • Also, certain commodities entering Canada are controlled / restricted for various reasons, food products, textiles, medical goods, used articles, as examples, and may require permits or approval forms from other government departments (OGD) prior to customs clearance. Health Canada and the Canadian Food Inspection Agency are two such departments.

  • For shipments valued at $1600.00 (CDN) or less, a commercial invoice is usually acceptable for customs purposes.

  • Shipments over $1600.00 (CDN) require a Canada Customs Invoice (CCI) to accompany the shipment OR a commercial invoice which contains the same data elements as the CCI.

  • Since the selling price would be comprised of the goods itself, transportation, insurance, brokerage, duty and GST. These components should be shown separately, where possible, to avoid paying unnecessary duty on pricing elements which, if identified, are duty free.

Goods & Services Tax (GST)

The GST is a value-added tax in which each stage of the production/distribution system is assessed. It is not a retail tax or a one incident tax that is charged to a consumer when a sale is made. GST is a business transfer tax that flows through the businesses to the consumer.

  • Most goods imported into Canada are subject to the Goods and Service Tax (GST) or the Harmonized Sales Tax (HST).

  • The GST was implemented in Canada on January 1, 1991. Most Canadian businesses and Non- Resident Importers are registered with the Canadian government to collect the GST/HST.

  • GST is applied at the border to all imported Commercial goods destined or supplied to all provinces within Canada.

  • Registered firms collect the GST on the sale in Canada of taxable goods and services supplied to all provinces with the exception of New Brunswick, Nova Scotia or Newfoundland at a rate of 5%.

  • Registered firms collect the HST on the sale in Canada of taxable goods and services supplied and destined to New Brunswick, Nova Scotia and Newfoundland at a rate of 13%.

At times a company may find itself in the desirable position to collect a refund. This happens when a company pays more GST that it collects. As the Importer of Record, you will be responsible for payment of the GST on any taxable commercial goods entering Canada. Your option is to register or not to register.

(Gst collected on Invoice) – (Gst Paid on Entry) = Gst Remitted to Canada Revenue Agency (CRA)

Should I be GST Registered?

You must collect 5% GST on the sale of all taxable goods and services supplied to all provinces with the exception of New Brunswick, Nova Scotia or Newfoundland or collect 13% HST on sales destined or supplied to the provinces of New Brunswick, Nova Scotia or Newfoundland.

Advantages:

  • Enjoy a tax credit or rebate of tax paid on the purchase of taxable services, or the purchase or

importation of taxable goods.

  • Easier for Canadian customer to take Input Tax Credit (ITC).

  • Able to recover GST paid on sample shipments.

  • Quicker recovery of tax paid on rejected or damaged goods.

  • Easier paper flow.

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