Clearit.ca's Blog on Customs Brokerage and News Updates
Customs compliance can be confusing no matter which country you’re shipping to. Many businesses in the United States believe expanding and shipping to Canada will be a breeze. This is not always the case. Many manufacturers and importers have found the compliance process in Canada to be quite cumbersome.
The key to navigating the compliance process and ensuring your products don’t get stuck at the border is hiring a qualified logistics provider to help your company through the process. With a little help, you’ll find:
- Border compliance isn’t complex once you know what is needed
- S. & Canadian governments use these compliance programs to ease and eliminate duty obligations
- Proper valuation and correct classification will make the process much smoother
- Most U.S. companies initially need the help of a customs expert when shipping into Canada
Here are a few more tips to ensure you don’t get stuck at the border when shipping to Canada.
Using Non-Resident Importer Status Gives Businesses from the U.S. Easier Access to the Canadian Markets
A program issued by the Canadian government allows U.S. businesses to claim Non-Resident Importer (NRI) status. This levels the playing field and allows U.S.-based businesses to collect sales tax at the time of purchase and makes clearing goods through customs easy. The issue is that the program is not widely known. Without the help of a Canadian customs expert, most U.S. businesses don’t know much about the program.
Duty Drawback Opportunities
Another opportunity for importers to Canada is the duty drawback. This opportunity allows refunds for all duties paid for any goods eventually exported. This goes for U.S. businesses too. Many businesses can recoup millions of dollars through this opportunity. Yet the filing process is complicated and most businesses don’t file for their duty drawbacks. It is estimated that over two billion dollars in drawback funds are left unfiled each year.
Are You Down with NAFTA?
The North American Free Trade Agreement (NAFTA) virtually eliminated tariffs throughout all North American countries. The United States, Canada, and Mexico have all agreed not to tariff goods produced or originating in a North American country. The issue stems from “origination” and what exactly that means.
Any good produced in the U.S., Mexico, or Canada can be eligible for NAFTA benefits. If a good has parts produced in other nations it can still be eligible. This is determined by a percentage of non-NAFTA materials included. In order to determine if a good is NAFTA eligible, an importer/exporter needs detailed knowledge of the product – often including production information about every single part used in the product.