Importing Business into Canada: 7 Must-Know Facts

Almost 40 million people call Canada home. As the country’s population continues to tick upwards and Canadians ascend the ladder of international affluence, importers and exporters are taking notice.

Since you’re reading this post, we assume that you’re considering expanding your business’s market into Canada. Before you start coordinating the shipment of products, there are a handful of things that all importers and exporters need to know about the realities of getting goods across Canadian borders.

Here are seven of the key considerations to keep in mind:

1. You’ll Need a Canadian Business Number

If you’re not based in Canada and are looking into importing business into the country, you’ll need a Canadian Business Number (CBN) to get started. A CBN is similar to an EIN which US-based companies carry. This number allows those that are making money off of the Canadian economy to be tracked so that Canada can collect relevant taxes and fees.

When you get issued your business number, you’ll automatically be registered for an import/export tax account. This account is managed through the Canada Revenue Agency. From there, you can register for corporate income tax and payroll tax accounts if they are relevant to your operation.

2. Some Goods Can’t Be Imported Into Canada

Like most countries, Canada has several restrictions on the goods that cross its borders. Before you go off and purchase palettes of a product that can’t make it into the Canada, brief yourself on what is and isn’t allowed.

Food importers/exporters can discover more information regarding safe food legislation. This legislation puts tight controls on comestibles. Importers of other classes of goods can find more information regarding restrictions here.

3. You Must Know Your Good’s Origin

If you’re a United States-based importer/exporter and you send a palette of goods into Canada, you can’t claim that your good’s origin is the United States.

There are a number of regulations, many of which are outlined in the “Rules of International Commerce” or “Intercoms”, which stipulate the accurate disclosure of a product’s creation. Given the number of hands that certain products go through to get to their final destination, determining an item’s origin can be difficult.

Work with whoever supplies your goods to understand your product’s production pipeline. If you misidentify your product’s place of origin, you may be liable to pay steep fines. You may even be prosecuted for fraud.

4. Imported Goods Will Likely Incur Fees

Most countries have tariffs/additional fees that they impose on external goods. These fees exist to help promote the purchase of locally sourced products.

Tariff classification. Rates of duty. Tax classifications… These are just a few of the factors that will determine how much you’ll have to pay per imported good.

Importers/exporters that manufacture goods in certain countries may be able to circumvent some import-related fees. This is accomplished through “Free Trade Agreements”.

For example, NAFTA makes it simpler (and cheaper) for North American countries to pass goods between one another.

5. Finding a Reputable Exporter Is Important

Many businesses that send goods into Canada don’t touch their goods themselves. They, instead, contract a manufacturer to send goods on their behalf.

If you’re simply coordinating shipments rather than producing goods, it’s imperative that you do business with an experienced exporter. Exporters that are shipping goods into Canada on your behalf will need to produce packing lists, bills of lading, certificates of origin, and customs invoices.

The more accurately that gets done, the smoother shipments will go. Inexperienced exporters are among the most common shipment bottlenecks that businesses encounter.

6. The More Canadian Shipping Experience Your Carrier Has, the Better

Your exporter isn’t the entity that transports your goods from a whorehouse to Canada. The job of moving your goods belongs to commercial carriers.

Depending on where your goods are coming from, commercial carriers might be trucking companies. They could be ocean freighters. They might even be railroad organizations.

No matter which mode of transportation your carrier uses, ensure that the carrier is experienced in moving goods into Canada.

By doing business with a Canada-savvy carrier, you’ll run into fewer snags. Common problems surrounding things like cargo control documentation and the CBSA will, consequently, be nominal.

7. Customs Brokers Can Help Navigate the Importing Maze

Are you feeling overwhelmed by all of the importing business information that we’ve shared with you? If you are, you’re not alone.

As a matter of fact, so many businesses feel overwhelmed when importing/exporting goods that a whole industry was built around aiding with this process.

Customs brokers are third-parties that work with your company to support your good’s shipment into Canada. They can help with filling out documentation and ensuring that other necessities are in order to ensure a smooth process.

When issues arise with shipments, a skilled customs broker is instrumental. They can work closely with Canadian officials to remedy problems.

Importing Business Into Canada Is an Acquired Skill That Pays Incredible Dividends

As with most things worth pursuing, mastering the process of importing business into Canada can present a steep learning curve for importers/exporters. Once you’ve gone through the process a couple of times though and have mastered its intricacies, you’ll find that the Canadian market offers rewards that are well worth the effort.

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