Duty is charged on a different number than most people expect, and GST is charged on top of the duty. Work out the real landed cost below, then read what customs clearance needs before the goods move.
Work out duty, GST and the real landed cost of importing goods into Canada. The duty rate comes from your tariff classification, so you enter it rather than have it guessed for you.
Enter the invoice value of the goods and the duty rate from your tariff classification. The rate is not guessed for you: duty depends on the HS code and the origin, and getting that wrong is what triggers a reassessment.
Enter a goods value to see the numbers.
Commercial imports. GST is charged on the duty-paid value, and a GST registrant normally recovers it as an input tax credit. The provincial portion of HST is generally not collected at the border on commercial goods. Excise duty, SIMA duty and other levies are not included. This is an estimate to plan with, not a customs entry: a licensed customs broker files the entry and confirms the classification. How we handle customs.
Three numbers decide the bill and they are calculated in sequence, not in parallel. First the value for duty: normally what you paid for the goods, converted to Canadian dollars at the rate in force on the date of direct shipment. Then duty, a percentage of that value. Then GST, five per cent of the value for duty plus the duty.
The two mistakes that cost money are both in that order. Adding international freight into the duty base inflates the duty, because Canada values on an FOB basis rather than a CIF one. Charging GST on the invoice rather than on the duty-paid value understates the cash you need at the border.
Freight, brokerage and terminal charges are real costs and belong in your landed cost, which is why the calculator above carries them. They simply are not part of what duty and GST are calculated on.
| Step | What it is | Worked example |
|---|---|---|
| Value for duty | Price paid for the goods, converted to Canadian dollars | USD 25,000 × 1.37 = $34,250.00 |
| Duty | A percentage set by your tariff classification and origin | 6.5% of $34,250.00 = $2,226.25 |
| GST | Five per cent of the value for duty plus the duty | 5% of $36,476.25 = $1,823.81 |
| Payable to CBSA | Duty plus GST, due on your accounting timetable | $4,050.06 |
| Landed cost | Duty-paid value plus freight, brokerage and fees | $41,500.06 |
Illustration only, using a 6.5 per cent rate and $3,200 of freight and fees. Your own rate depends on your classification and the origin of the goods.
There is no single Canadian duty rate. There is a tariff classification, and a rate that hangs off it. The classification is an HS number that describes what the goods are, and the rate then depends on which tariff treatment the country of origin qualifies for. Goods from a free trade partner may enter free where the same goods from elsewhere carry six or seven per cent.
That is why this page does not print a rate for you. Any site that offers to guess your duty from a product name is guessing, and the reassessment lands on the importer of record, not on the website.
Look the number up in the Customs Tariff, ask your supplier what they declare on export, and have it confirmed before the goods ship rather than after. Classification turns on what the goods are, what they are made of and what they are used for, and two products that look identical on a website can sit in different headings for reasons that are not obvious from a photograph.
Origin is a separate question from where the goods were shipped. A container that leaves Shanghai may hold goods that originate in three different countries, and preference under an agreement depends on the origin rules being met and certified, not on the port of loading. Where a rate looks surprisingly good, the certification behind it is usually the thing worth checking twice.
Whoever is named as importer of record is responsible for the declaration being right, for the duty and GST being paid, and for the records that support both. Engaging a broker or a forwarder does not move that responsibility. It buys you people who do this daily and who will tell you when something does not look right, which is worth a great deal, but the legal position stays where it started.
CBSA can reassess an entry well after release. When that happens the demand goes to the importer of record, and it is for the difference plus interest. This is why a classification decided quickly on a first shipment can turn into a bill on the fiftieth, and why the cheapest moment to get the position right is before any of them move.
Keep the supporting records for six years: invoices, proof of payment, origin certifications, and whatever you relied on for the classification. The obligation is to be able to show your work. An importer who can produce the file usually settles a reassessment far more cheaply than one who cannot, because the argument is then about the merits rather than about the gap.
Most held shipments are held on documents, not on inspection. The set is short and the failure is almost always the same one: a description that does not let anyone confirm what the goods are. Everything below travels with a commercial import, and every line of it needs to agree with every other line.
Description, quantity, unit and total price, currency, country of origin, terms of sale, and the full legal names and addresses of buyer and seller. A line that reads parts, samples or goods is what gets an entry stopped.
Piece count, weights and dimensions that match the invoice and the bill of lading. Where the three disagree, the entry waits until somebody reconciles them, and that somebody is rarely available at the moment it matters.
The contract of carriage, and the document the release is matched against. The consignee shown here needs to be consistent with the importer named on the entry.
Required to claim a preferential rate under a free trade agreement. Without it the goods pay the general rate, whatever their origin actually is.
Food, plant and animal products, some electronics, textiles and steel carry other government department requirements that are confirmed alongside the customs entry rather than after it.
The entry is submitted before arrival. For a truck crossing from the United States that is a PARS barcode sent to the broker ahead of the driver; for ocean and air it is the release request filed against the arrival notice. CBSA either releases the shipment or asks a question.
Release is not the same as accounting. Goods are typically released first and the duty and GST are accounted for afterwards, on the timetable that comes with your importer account. That gap is useful for cash flow, and it is also where importers who have not registered properly discover they have nowhere to account from.
If the entry is referred, the practical question is how quickly the answer can be produced. An importer who can send the classification reasoning and the origin certification within the hour usually sees the hold cleared the same day. An importer who has to go and ask the supplier loses days. This is the whole argument for having the file in order before the goods move.
Qeep keeps the clearance and the freight on one timeline. The customs filing is prepared by a licensed customs broker while the equipment is being arranged, so the release is not waiting on paperwork and the truck is not waiting on the release.
A first import goes badly far more often than a fiftieth, and almost always for administrative reasons rather than freight ones. There are four things to have in place, and every one of them takes longer to arrange from a terminal than from a desk.
Get a business number with an import-export account, and register in CARM so you can see your own statements of account and pay CBSA directly. Decide who the importer of record is and make sure that party is the one registered. Settle the classification and the origin position with your supplier while you still have leverage, which is before the goods are paid for. Then price the landed cost rather than the invoice, so the margin you quoted survives contact with the border.
None of this is difficult. It is simply sequential, and the sequence is unforgiving if you start it in the wrong order. If you are working out whether a first shipment is viable, run the numbers in the calculator above before you agree a selling price, not after.
How clearance is coordinated with a licensed customs broker, on both sides of the border.
Read more →PARS, PAPS and the document set that keeps trucks moving at the Canada–US border.
Read more →Ocean and air movement into Canada, with the customs entry filed alongside the freight.
Read more →Container moves off the marine terminal or rail ramp once the goods are released.
Read more →Shifting ocean containers into domestic trailers so inland freight costs less per pound.
Read more →Clearance for freight arriving through Pearson, the GTA rail ramps and the Ontario crossings.
Read more →Duty is a percentage of the value for duty, which is normally the price paid for the goods converted to Canadian dollars at the rate in force on the date of direct shipment. International freight and insurance are not part of that base, because Canada values on an FOB basis rather than a CIF one. The percentage itself comes from the tariff classification of the goods and the tariff treatment their country of origin qualifies for.
Yes. GST is five per cent of the duty-paid value, which is the value for duty plus the duty. Charging five per cent on the invoice alone understates the cash you need at the border. If you are registered for GST you normally recover it as an input tax credit on your next return, so it is a cash-flow cost rather than a permanent one.
On commercial goods the provincial portion of HST is generally not collected at the border. CBSA collects the five per cent GST and the province is accounted for through your regular sales tax filings. Casual and personal importations are treated differently, which is where most of the confusion on this comes from.
The importer of record is the party legally responsible for the accuracy of the customs declaration, for paying duty and taxes, and for keeping the records behind both. That responsibility does not move to your freight forwarder or your customs broker because they handled the filing. If CBSA reassesses the entry two years later, the bill goes to the importer of record.
A non-resident importer arrangement is possible and is common where a supplier wants to quote delivered prices. It is a deliberate structure with its own registration, record-keeping and GST consequences, not something that happens by writing DDP on a purchase order. If nobody has set it up, the Canadian buyer is the importer of record by default.
A clear description of the goods, the quantity, the unit and total price, the currency, the country of origin, the terms of sale, and the full legal names and addresses of buyer and seller. A vague description is the single most common reason an entry gets held, because a classification cannot be confirmed from a line that reads parts or samples.
You can file your own entries, and some high-volume importers do. Most do not, because the classification, valuation and origin decisions carry the liability and the filing windows are short. Qeep coordinates clearance with a licensed customs broker who files the entry, and keeps that filing tied to the movement of the freight so neither waits on the other.
When the paperwork is complete and submitted ahead of arrival, release is often minutes rather than hours. What creates delay is almost never the border itself. It is a document that arrived late, a description that does not match the freight, or a classification question nobody raised until the shipment was already at the terminal.
CARM is the CBSA system through which commercial importers manage their own account, see their statements of account and pay duty and GST directly. If you are the importer of record you need your own business number with an import-export account and your own CARM registration. It is worth doing before your first shipment rather than while it sits at a terminal.
Not automatically. A free trade agreement gives a preferential rate to goods that both originate under that agreement's rules and are supported by a valid certification of origin. Goods that are merely shipped from a partner country do not qualify. Claiming preference without the certification on file is one of the more expensive mistakes to unwind on reassessment.
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