Running a business is rewarding and can be full of challenges at times, especially if you import goods into Canada. As long as you stay on top of the latest changes in policies with the help of a trusted team and have the basics down right, you’ll encounter fewer mishaps along the way. We have 10 easy steps to follow to get you started right.
- Are your goods eligible to be imported into Canada?
It all starts here and determining the eligibility of the goods you want to import is the basis of your business.
What you will need to do:
- An accurate description of the goods you plan to import.
- The country of origin, manufacturer, and exporter of the goods.
- Review Canada’s Import Control List (ICL) and Export and Import Permits Act as Canada has import controls on a variety of goods.
The next step will be to determine whether your goods are controlled, regulated, or prohibited by Other Government Departments (OGD). There are over 10 OGD departments and a few include the Canadian Food Inspection Agency (CFIA), the Department of Fisheries and Oceans, and Health Canada. These OGDs regulate goods that relate to their agencies. You may have to provide special permits, certificates, licenses, labelling, and packaging if your commodity is regulated.
- Taxes and Duties
All goods imported into Canada must have an accurate and correct Harmonized System Classification (tariff classification) applied when it clears through customs. The classification code identifies the item and the rate of duty to CBSA. You will want to classify your goods correctly in order to apply the correct duty and to avoid paying Administrative Monetary Penalty System (AMPS) penalties or having your shipment seized.
Determine:
- Tariff classification
- Applicable tariff treatment
- Rate of duty
- Taxes payable upon import
- Are your goods part of a Free Trade Agreement?
Free trade agreements allow goods flowing between countries that are part of the agreement to receive preferential duty treatment in order to help reduce trade barriers. There are quite a few advantages if your items qualify and Canada has free trade agreements with several countries.
- Understanding the logistical process and surrounding yourself with a competent team
You’re good at what you do and that may not necessarily include being a pro in all the rules and regulations surrounding importation. That’s where hiring a competent team that you can trust comes in. From enlisting the help of freight forwarders, customs brokers, to hiring trucking companies that have access to all major ports and rails, you’ll want to make sure that you surround yourself with a team that delivers and stays on top of their game.
Having a good understanding of customs regulations and requirements is also greatly beneficial as you can spot errors if problems arise.
- Getting your import license
You are required to obtain an import license/account before you can import goods into Canada. The process includes registering with municipal, provincial and federal governments to secure a Business Number (BN), registered business name and a GST/HST account.
- Submitting your Import Declaration to CBSA
Although you can arrive in person at the port of entry to meet your goods and make a declaration or have your in-house team submit the documents via Electronic Data Interchange (EDI), this is often more time-consuming and expensive compared to hiring a customs broker. Customs brokers can help you reduce cost, improve efficiency, and mitigate risks or problems that may arise.
- Determining how you will pay your duties
You can prepare the release and accounting documents yourself or a customs broker can take care of all the paperwork for you.
The three different payment methods include:
- Direct Security – posting a bond and security yourself
- GST direct – you will be able to opt into paying customs on the last day of the month without posting a bond or obtaining security, but this does not cover duty, only GST
- Using a customs broker’s bond – customs brokers have bonds in place with Canada Customs and you will be charged a fee to use their bond
- Transportation of your goods
Depending on the origin of your goods, you’ll need to identify the mode of transport (sea, rail, air, truck) for bringing your shipment to Canada. You can once again organize the carriers yourself or enlist the help of a freight forwarding company. You’ll also want to keep in mind the logistics of transporting your goods once it arrives in Canada.
- Know your Terms of Trade
Incoterms are terms of sale and internationally recognized rules that clearly define the responsibilities of the sellers and buyers. Incoterms specifies who is responsible for paying for and managing the shipment, insurance, documentation, customs clearance, and other logistical activities. This is extremely important as you will need to know what you are responsible for.
- Staying on top of Customs Compliance
Maintaining your customs compliance including monitoring your customs activity and working closely with your customs broker ensures that the goods you need for your business flow smoothly. Staying on top of changes and having everything in place is key to the success of your company.
As the demand for goods skyrocketed from a change in spending habits due to the pandemic and a lack of containers worldwide, companies that are not well-equipped with a strong support network may experience additional challenges and unexpected delays. Having a good team working for you is worth every single penny. Do what you do best and outsource the rest!
At Sandhar Trucking, we strive to provide our customers with above and beyond service that ensures each and every shipment arrives on time and safely. As a leader in the trucking and warehousing industry in Metro Vancouver, our experienced team is always ready to answer any questions and is well-versed in the latest logistical changes happening worldwide. We also have trusted industry partners in customs brokerage and freight forwarding that can help you with your import and export needs. Whether you’re in need of container trucking, LTL/FTL services or a bonded sufferance warehouse, you can count on us to deliver the best.
Contact us today at (604)-276-9044 or info@sandhartrucking.com today to learn more.