The thought of Canada import duties can be overwhelming. You're not the only one. Many Canadians also find it complicated.

But don't let it stop you from shopping online at your favourite stores outside Canada; this blog will help you understand what these import duties are all about.

Looking to calculate import duties for your shipment? Try using our handy calculator.

Key Takeaways

• Canadian customs duties are government-imposed fees on certain goods entering the country. The amount you pay depends on the type of product, its value, and the country of origin.
  
  
• You can pay customs duty in different ways: cash, cards, checks, or through your shipping carrier. The Canada Border Services Agency (CBSA) collects these duties and checks if the package follows customs regulations.
  
  
• Consider using a reliable package forwarding service for a hassle-free cross-border shipping experience.
  

What Are Customs Duties in Canada?

Canada import duties are charges imposed by the Canadian government on goods from other countries that enter the country. These fees help generate extra funds for the government, which is used to fund public services and infrastructure projects.

Additionally, these customs fees also help protect domestic industries and ensure fair competition.

The amount of duty you pay is determined by several factors:

• The type of good. Different product categories have varying duty rates.
  
  
• The value of the good. The higher the value, the higher its duty.
  
  
• The country of origin. Canada has trade agreements with other countries that affect duty rates. It is the Canada-United States-Mexico Agreement (CUSMA) that helps reduce duty fees when trading between the three countries.
  

Calculation of Import Duties

Import duties in Canada are calculated based on the value of your purchased goods. It's essential to accurately declare your package to have its Harmonized System (HS) classification, which CBSA uses to determine its duties and taxes.

So, preparing for your duty rates can help you budget for your purchases. The CBSA website and some shipping carriers offer a duty calculator tool you may use to estimate the potential charges for your specific item. Below is an example:

With that product declaration above, the following will be its estimated additional customs fees:

Applicable CBSA Tax: CAD 18

Applicable CBSA Duty: 0

Estimated Total of Additional Customs Fees: CAD 18

While, suppose the product above isn’t from a CUSMA country, wherein it won’t be applicable to any tax exemption, below will be its computation.

Applicable CBSA Tax: CAD 19.17

Applicable CBSA Duty: CAD 9.75

Estimated Total of Additional Customs Fees: CAD 28.92

Remember that minor adjustments to the total fees may happen based on the updates of CBSA.

Exemptions and Reductions

There are some exemptions and reductions that you can apply to your goods. Here's a breakdown:

Note that this can change at any time, thus constantly being updated with the list of exemptions; it's always best to refer to the CBSA's website.

Difference of Duties And Taxes

As noted above, customs duties apply only to goods you bring to enter Canada. On the other hand, taxes are broader charges that apply to various products within the country. There are many different tax types, such as the following:

While customs duties and taxes are forms of taxation, they serve different purposes and are calculated differently.

How to Pay Duty on Imported Goods?

Paying the applicable customs duties and taxes for your shipment after your customs declaration is crucial. It is highly recommended that you settle your item's total duties as soon as you know the amount. Here are some ways to do it:

Remember that these payment options may change at any time, so it's best to always check the CBSA's website for more updated information.

What Are The Consequences of Not Paying Customs Duty?

Bringing goods to Canada but neglecting to pay for its applicable duties can lead to several consequences:

Financial Penalties

Failure to pay customs duties and taxes can result in financial penalties. The fine may vary depending on the value of the goods and the nature of the violation. Sometimes, you may also be required to pay interest on the unpaid amount.

Seizure of Goods

One of the severe penalties you can receive is when customs holds your package. This means they will take possession of the goods until all outstanding amounts, including duties, taxes, and any applicable penalties, are paid in full.

While in worst-case scenarios, if this isn't settled immediately, they may dispose of your package.

Delays in Delivery

Expect delays in your package delivery if you still haven't paid your duties. If the CBSA isn't releasing your goods, they won't be delivered. These delays can disrupt your plans or cause inconvenience, especially if you expect the items for a specific time.

Damaged Reputation

Not paying customs duty can hurt your reputation as a shipper. Ignoring these rules may cause customs officials to see you as unreliable. This could lead to more checks and problems with future shipments.

How Can A Package Forwarding Service Be Helpful When Bringing Items to Canada?

As mentioned earlier, you can pay your customs fees with a package forwarding service. Still, aside from that, they can further help you with your shipments. Here are the helpful factors they provide:

1. Simplified Shipping Process

Package forwarders handle your package's entire shipping process. From receiving your items at their provided international address to forwarding them to Canada, they manage it all.

This means you can enjoy the perks of online shopping using their international address while being stress-free about the delivery.

2. Expertise with Customs Duties

Package forwarding services are just as expert as traditional direct package shipping companies; they are all knowledgeable about the customs process, including paying duties. They can help you understand the duties of your items to avoid unexpected fees.

Additionally, they can automatically apply your personal exemption for purchased products. They can also assist you in determining which personal use goods are tax-exempt. This knowledge can help you save time and money while keeping your shipments within the rules.

How Can Shippsy Help with Your Shipment Needs?

When it comes to a reliable and cost-effective package forwarding service, Shippsy is the answer! Our experienced team can smoothly handle your goods' customs clearance, ensuring your shipments follow Canadian regulations and minimizing the chance of delays.

Additionally, Shippsy has budget-friendly and transparent fees, so you know what you are paying for! If you have any questions, contact their customer support.

Final Thoughts

Customs duties can be tricky, but they don’t have to be! By learning how these fees work and what exemptions apply, you can easily manage your cross-border shipments.

With Shippsy as your shipping partner, you can take the stress out of the process. They’ll handle everything, including your shipments and customs duties, so you can just sit back and enjoy shopping!

Aman Chopra

Aman looks after the content marketing department at Stallion Express. He is passionate about helping businesses grow by providing informative and up-to-date trends in the eCommerce industry. Outside the office, you can find him on the soccer field cheering on Real Madrid.

Read all posts written by  Aman Chopra