If you are a Canadian citizen planning to do some online shopping south of the border, you should be aware of the import duties that may apply to your shipment.
Customs fees depend on several factors, such as the value of your items and the shipping method you choose. In this article, we’ll give you some tips on how to avoid customs charges from the USA to Canada and save yourself some money.
Ensure Goods Are Made in the USA
If you’re getting clothing products, textiles, leather, or footwear from the USA to Canada, you’ll get your items duty-free if they’re manufactured, assembled, produced, and packaged in the United States. The items must be shipped directly from the United States to qualify.
Basically, it will be enough if the goods are marked with “made in the USA” for the duty charges to be waived. The same goes for items made in Mexico, thanks to the United States – Mexico – Canada Agreement (USMCA) that replaced the North American Free Trade Agreement (NAFTA).
Unfortunately, if you plan to shop from online platforms such as AliExpress, you won’t be able to make use of this loophole.
Self-Clear Shipped Products
You can avoid brokerage fees and Canada’s duties on shipped items if you take a more proactive approach and clear the items with customs yourself. The first step is to call the courier company and tell them you will pick up the item and that you don’t need it to be delivered.
The necessary documents you need to provide are the invoice for your item, the waybill or manifest, and your ID. The manifest or waybill is provided by your courier company, and it contains the shipping information the warehouse needs to find your item.
Once you get all the documents, head to the customs office closest to the warehouse in which your item is stored. You may need to complete form B15, and once you’ve done that, the agent will stamp your manifest, confirming they released the item to you. Finally, you can go to the warehouse and take the product.
This method may require more effort, but you’ll be able to save the money you would usually pay if the courier delivered the package to your address. Even in cases where you live far away from the customs warehouse where your item is located, it might be worth the fuel or hiring a broker to claim the item for you, as customs charges can go quite high.
Send Your Item as a Gift
One way to avoid paying duties and taxes in Canada is to have someone send the item from the USA as a gift. However, remember that the person sending you the product needs to include a card or note indicating it’s a gift.
However, this will only work if you’re getting an item worth less than $60. Also, you won’t be able to get advertisements, alcohol, tobacco, or items sent by businesses as gifts and avoid fees. They will be subject to Canadian import fees no matter their worth.
If you want to receive multiple gifts and avoid the $60 limit, you should know that the total value of gifts sent at the same time from the USA is added together. For example, if the combined value of three separate items sent during one day exceeds $60, you’ll pay duties and taxes.
Import Cheap Items by Mail or Courier
If the item you want to get from the USA by mail is worth less than $20, you won’t have to ask anyone to send it as a gift, as you’ll be able to get these products tax- and duty-free. This does not apply to alcohol, tobacco, periodicals, magazines, beverages, or books.
However, it’s not enough to simply claim that the item is worth less than $20. To prove the item’s worth, ask for an invoice from your sender. The invoice should clearly state the value of the product and should include all required documentation, as well as USMCA certification (if applicable).
For items imported from the US by courier, there will be no duty or tax if they’re worth up to $40. When it comes to goods valued from $40 to $150, there will be no duty from the US to Canada, but you’ll pay taxes.
Understanding Import Fees in Canada
To better explain the custom charges that apply to the goods you import to the country, we need to cover each category separately. For starters, there are custom duties, import taxes, sales taxes, and brokerage fees.
Canadian Import Taxes and Custom Duties
Import taxes are imposed by the government, and they apply to all goods coming from abroad. This is a federal tax, and it depends on the specific features of your parcel. Taking into consideration the origin country, size, type, and weight of the product, the Canada Border Services Agency determines duties on the product you imported.
If you don’t want to self-clear your items and prefer to have a courier deliver them to your door, you’ll have to pay brokerage fees. These fees vary between providers, so it’s advisable to check which courier company will handle your package and how much it will cost to have it delivered. Brokerage fees cover service fees, paperwork, customs duties, and taxes.
When it comes to sales taxes in Canada, there are three types: Harmonized sales tax (HST), goods and services tax (GST), and provincial sales tax (PST). GST and HST are levied by the federal government, whereas PST, as the name suggests, is levied by provinces.
In most cases, GST on shipped products will be 5% of the value of the product in Alberta, British Columbia, Manitoba, Northwest Territories, Nunavut, Quebec, Saskatchewan, and Yukon. Other provinces only charge the HST: The charge will be 13% in Ontario and 15% in Prince Edward Island, New Brunswick, Nova Scotia, Newfoundland and Labrador.
If you live in Saskatchewan, Quebec, Manitoba or British Columbia, you’ll pay PST and GST. Provinces that pay GST only are Yukon, Nunavut, Northwest Territories, and Alberta.
What Are the Fees for Different Courier Companies?
If you’re sending goods from the USA to Canada, one of these courier companies is likely to handle the delivery. Let’s look at the fees you might have to pay.
Canada Post/USPS Fees
USPS is pretty convenient since it offers flat-rate options for shipping, which are fairly affordable compared to other companies. However, if you’re using USPS to send items from the USA to Canada, a downside you might face is the delay once Canada Post takes over your item. You might have to wait a few more days longer since your item will get a new tracking number and because customs clearance might take longer than usual.
When it comes to Canada Post, it will charge either an $8 handling fee for a parcel sent by Priority Courier or a $5 handling fee for collecting taxes and duty on behalf of the CBSA. You need to pay this amount at delivery either by Visa, cash, Canada Post commercial account, cheque, or Mastercard.
You won’t be able to find a list of all FedEx charges on their website, but they offer a handy tool that will help you calculate the shipment cost from the USA to Canada for the specific item.
When you type in the origin and destination country, and their postcodes, you can select the type of shipment. Then, you indicate how many packages you want to be shipped and the weight of each package. Finally, set the preferred date you want this item to be shipped, and you’ll get the rates and delivery dates for it.
What you can find on the FedEx website is the Clearance Entry Fee structure from the US to Canada, based on duty value:
|Value for Duty in Canadian dollars||Fee in Canadian dollars|
|$40.01 – $60||$15.45|
|$60.01 – $100||$19.30|
|$100.01 – $150||$25.50|
|$150.01 – $200||$29|
|$200.01 – $500||$45.35|
|$500.01 – $1,000||$50.75|
|$1000.01 – $1,600||$60.10|
|$1,600.01 – $3,300||$70|
|$3,300.01+||$70 + $6.03 per additional $1,000|
Since the customs authorities determine which taxes and duties in Canada apply to specific items, this information cannot be found on DHL’s website. However, you can find information on customs clearance. You’ll be charged $17.50 or 2.5% of taxes and duties (whichever is higher) if you don’t have a DHL brokerage account.
Mailing Goods to Canada While You’re Abroad
If you’re abroad for business, vacation, or just to spend some time in another country, you might want to send some items back home. This sounds simple, but you may be surprised by certain charges it entails.
If you sent the items while you were abroad, make sure you declare them on Form E24 (Personal Exemption Customs Declaration) upon your return to Canada. This way, you won’t pay duties and taxes, and you’ll get to claim your goods. Remember to keep a copy of the form when claiming the goods, as well as any additional documents and sales receipts.
When sending goods from the USA to Canada, you need to be aware of different taxes and duties. Even if the seller doesn’t include these in the shipping cost, they will still apply once your item reaches its final destination.
The strategies from this article can help you avoid some of these fees and thus save money, so, before you make your purchase and order your items, explore each tip we provided and whether it’s applicable.
What items need to be declared at Canada Customs?
You are required to declare items for which you have to pay duty, such as tobacco, alcohol, and any amount of money that exceeds $10,000. You must also declare plants, firearms, food, animals, and business goods.
How much can you ship from the US to Canada without paying duty?
With the USMCA agreement, the duty threshold has been raised to $150, so you won’t pay duties if your item is worth up to this amount. However, sales taxes will apply for anything worth more than $40 arriving by courier.
Can you clear your items yourself?
If you want to avoid brokerage fees, you can self-clear the items. This is one of the tips that can be found in our guide on how to avoid customs charges from the USA to Canada.
First, you need to notify the courier company and tell them you don’t want them to deliver the package to you. After that, you need to collect a few documents and head to the customs office closest to the warehouse where your item is stored. When you provide the documents to the customs agent, they will give you a clearance with which you’ll be able to get your item from the courier’s warehouse.