Are you importing from China to Canada and.
Today’s ultimate guide will walk you through all the vital stages of this process.
From customs rules and regulation, classification of imports, finding freight forwarder, shipping process, etc. – It covers everything you need to know when importing from China to Canada.
What are the different types of sea freights available when importing from China to Canada?
The types of sea freight will bring us to discuss the different types of ships available for transporting cargo.
The main types of sea freight available include:
Containers are ships that carry goods in different container sizes.
Bulk carriers which carry goods that do not have special packages such as coal
Tankers specialize in the transportation of liquid such as vegetable oil and wine
Reefer ships are responsible for transporting perishable products such as fish and meat.
RORO ships are for transporting goods that have wheels such as cars.
What are the charges that I will incur for transporting cargo from China to Canada?
The cost of transporting cargo from China will also depend on the mode of transport and the types of goods.
Air freights will cost more than sea freights because they are faster.
Perishable and fragile goods will require more care thus increasing the cost of transport.
How long will it take for me to receive my goods in Canada?
The time it takes for the cargo to reach you will depend on the mode of transport for the goods.
You can either decide to use air freight which will take under five days or sea transport.
Sea transport will take around one month before you get the goods.
So, let’s get to the key subject of this guide:
- Get a Business Number from CRA
- Know How to Classify Imports from China to Canada
- Understand Canadian Import Rules and Regulations
- Hire Freight Forwarder from China to Canada
- Consider Finding a Licensed Customs Broker
- Determine Canada Import Duties from China
- Identify Goods to Import from China to Canada
- How to Find Chinese Supplier when Importing from China to Canada
- Importing from Alibaba to Canada Step-by-step Process
- Importing Personal Goods to Canada from China
- How Ship Imports from China to Canada – Choose Reliable and Cost Effective Mode of Shipping
- Importing from China to Canada FAQs
Get a Business Number from CRA
There are many businesses in Canada that have been importing cargo from China to Canada to sell to the locals.
According to some of them, the process may seem to be difficult at the beginning but you will adjust well.
It is a complete process that requires determination and full adherence to the rules and regulations for easy movement.
The first step in getting the cargo from China to Canada involves getting a business number from CRA.
CRA is an initial for Canada Revenue Agency and they are responsible for issuing import and export accounts.
You will not pay any fee for the account and the department will provide you with the information very fast.
i. A business number is the tax ID number that you will use when you have to pay for the import duty. The account number has three main parts which include:
ii. The business number consisting of nine digits for the identification of your business
iii. An identifier with two letters that will show the type of program you are dealing in
iv. A reference number of four digits for the account of your program
The process of getting a business number from the Canadian Revenue Authority is straightforward.
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The registration is free and you can do it through the following services:
i. Business Registration Online Service (BRO) which involves logging in to the website and applying for the business number.
ii. Making a call to the CRA and verbally communicating your request for the business number. You will answer the questions on part A of the RC1 form and get the business number as soon as possible.
iii. Filling the form RC1 requesting for the business number before mailing it to the nearest tax office.
Whenever you are registering for the business number, remember to apply for other tax identification numbers.
These include registration for GST/HST, payroll, and corporate income tax accounts for your business.
Apart from that, it is obligatory to have the GST/HST for imports or exports.
Know How to Classify Imports from China to Canada
The Harmonized system of classification of imports is customs classifications that you can use internationally.
Many countries in the world use the harmonized tariffs or codes whenever they intend to trade with other countries.
It is a factor that you will identify with whenever you intend to import cargo from China to Canada.
The customs tariff in Canada follows the same procedure set by the World Customs Organization (WCO).
You can also identify it as the Harmonized Commodity Description and Coding System (HS).
The World Customs Organization (WCO) is responsible is an intergovernmental organization that is responsible for developing the HS guideline.
In Canada, HS compliance is an obligatory process of declaration and classification of goods coming and leaving the country.
As an importer, you should use the HS to correctly declare and classify the goods that you are importing.
Consequences of Non-compliance or Malpractice
i. Delays when it comes to releasing the imports
ii. Suspension of certain privileges such as the privilege to import
iii. Fines that are in accordance with the Administrative Monetary Penalty System
iv. You have to provide the HS data when you are declaring the imports. The data is important for:
v. Determination of the appropriate duty rates for the goods you intend to import
vi. Negotiation of trade agreements
vii. Maintenance of the trade statistics
viii. Identification of shipments and goods that are risky to human safety, health, and security.
New traders may not be in a position to understand the HS rules and can get more information from CBSA.
Canada Border Service Agency (CBSA) has different programs, and service for educating new traders about the Harmonized System.
It is also in support of voluntary compliance for the Harmonized System from the traders.
Canada is one of the members of the World Customs Organization since 1971.
It is also part of the Harmonized System Committee and the Harmonized System Sub- Committee.
It, therefore, means that they are strict about the rules of this system and importers should respect the regulations.
Apart from understanding the Harmonized System, it is important to know how to classify the merchandise that you will import.
This includes determining the right classification number of the goods.
Knowing the country where the goods come from and the classification number will help in determining the amount of duty to pay.
Understand Canadian Import Rules and Regulations
Import of goods from a foreign country into another country is under regulation and you have to respect the rules.
The country where the goods are going to has certain rules governing the import of merchandise and Canada is no exception.
It is the responsibility of the person importing the merchandise to make sure that cargo complies to the rules and regulations.
Apart from that, the importer should make sure that the cargo has the right documentation before importing it.
Importing unsafe goods, or goods that violate the regulations set by the country attracts fines and penalties from the government.
Before you engage in importing goods from China, make sure that you understand the following rules and regulations.
Avoid Canada Prohibited Imports
There are certain goods that the government of Canada will not allow into the country as imports.
The goods can be as obvious as child pornography or less obvious as some types of motor vehicle.
The type of goods that you will not bring into Canada is in the following paragraphs.
Prohibitions mean that the item you want to import does not have access by law into Canada.
The law states clearly that there is a certain type of goods you should not bring across the Canadian border.
The prohibited goods in Canada include:
i. Fresh fruits
ii. Firewood is also prohibited and campers will have to purchase firewood in the country. They will use it on site and then leave the surplus at the camping site.
iii. Weapons such as munitions, pepper spray, tasers, and brass knuckles
iv. Certain types of knives such as the ones you will use for fishing or hunting
v. Radar detectors
vi. Obscene material such as child pornography, and hate propaganda.
vii. Certain types of food material such as live birds, poultry meat, poultry manure, feathers, and other poultry related products.
viii. Nuclear materials
ix. Narcotics
x. Softwood lumber and sugar
The Canada Border Service Agency is responsible for guiding the importer on the type of goods he can import.
They will also guide you and let you know about the goods that require certain permits before importing them.
Acquire Special Permits on Canada Restricted Imports
There are certain types of goods that require special permission before they come into the country.
The goods that are under control by the government and require special import permits are the restricted goods.
These goods will require permission, certification or inspection from different departments of the government.
The CBSA is responsible for the administration of the import requirements on behalf of the different departments of the government.
There are certain goods that will require the input of more than one section so make sure you contact every department.
Some of the goods that require special permission before importing them include:
i. There are certain items that you cannot import through the mail services. These items include perishable items, perfumes, inert munitions, replica, and flammable liquids.
You have to contact the Canada post to get further clarification on these imports.
ii. Firearms also require special permission from the Canadian Firearms Program
iii. The cultural property will require a permit or certificate for import from the Canadian Heritage
iv. The Canadian Food Inspection Agency is responsible for the provision of permits for the importation of food products. Plants, food, and animals that are either terrestrial or aquatic, food labeling and recalls, wood packaging are under this department. It is also responsible for controlling user equipment or machinery and international waste coming into the country.
v. Nuclear equipment, material and technology, and radiation emitting devices are under the control of Canadian Nuclear and Safety Commission.
There are quite a number of products that require special permits due to their nature and sensitivity.
Such goods require the involvement of the government in the whole process of procurement and importation.
Tobacco or alcohol products will require special permission from the province where you are taking the products to.
The restrictions further state that there are some goods that will need special stamps and labeling from the origin country.
There are certain goods that are subject to SIMA or the Special Impact Measures Act.
The special measures include:
i. Anti-dumping duties
ii. Countervailing undertakings and duties
There are certain goods that are subject to domestic control and that is an area that requires your attention.
Apply for Relevant Inspection, Certificates, and Permits
Canada, just like any other country in the world has to know the type of goods that you intend to import.
You will have to contact the relevant agency and inform them of your intention to import certain goods.
It will be useful as it is an early application and preparation for import inspection in Canada and for the timely offer of permits.
The first step in this process is letting the authorities know about the type of goods that you will import.
The authorities will then check against their database and see if the cargo is relevant for import.
After that, they will help you in processing the relevant documents as you apply for the certificates and permits.
The Export and Import Controls Bureau will take the responsibility of providing the relevant import permits.
Normally the restrictions on getting the import certificates and permits allow the country to restrict certain types of imports.
The inspection also allows them to check on the type of goods you are bringing into the country.
Apart from that, the process of inspection involves checking if you have all the relevant documents for imports.
It goes further to see if the labeling is bilingual and the packaging is according to the right standards.
Besides, it is also important for determining the amount of tax and duties that you must pay before you get the goods into the country.
There are certain types of certificates, permits or documents that you must have as an importer.
As an importer, you should know that different provinces in Canada have different regulations on imports.
The type of documents you that will need, depends on the mode of shipping and the type of goods.
The list of the most important type of goods for imports into Canada include:
i. Canada commercial invoice or customs invoice
ii. Bill of lading
iii. Sales contract
iv. Packing list
vi. Insurance policy
vii. Customs declaration
viii. Certificate of origin
You will get some of the documents from the supplier and some are available at the customs office in Canada.
As an importer, you need to understand the regulations and the impacts of breaking the rules.
You might end up paying heavy fines and risk jail terms if you break the rules which are a waste of resources.
Hire Freight Forwarder from China to Canada
As an importer, the process of going through the customs regulations and the import requirements may be tedious.
It might also take a huge chunk of your time making the process very unreliable for your business.
Well, if you are unable to work it out on your own, you can decide to hire a freight forwarder to handle everything.
A freight forwarder is a company that is responsible for the arrangement of shipping goods from one place to another.
It takes care of the transport and storage of the goods within the country of origin as preparations are underway.
Note that hiring a freight forwarder is optional as you can do all the activities that they do.
The main activities of the freight forwarder include:
i. Taking care of the transport of cargo from the supplier and tracking it all the way to the stores.
ii. Storage of the cargo as they prepare the relevant documents for export and transport
iii. Preparing the documents that will be relevant for the shipping of the cargo
iv. Organizing for the type of transport and booking space for your goods on the ship or plane
v. Negotiations of the charges of freight or the charges for transporting the cargo
vi. Freight consolidation
vii. Organizing the relevant insurance for the cargo and filing of insurance claims if possible
viii. Most of the freight forwarders will ship your cargo under their personal air waybills or bill of lading.
Their agents in Canada will take care of the necessary documentation before the goods arrive in the country.
They will organize for delivery of documents, deconsolidation, and services of delivering the cargo.
Freight forwarders will not be the actual movers of the cargo but will be the intermediary between the relevant companies.
They will negotiate deals with the relevant transport agencies on the shipping of cargo, trucking, and air shipments.
The good relationship that a freight forwarder has with the transport agencies will help in getting a good price.
There are certain instances when the client decides to use the freight forwarder as the shipping agent.
They will offer the client with the relevant advice on how to move the cargo from one place to another.
The knowledge and experience that a freight forwarder has on regulations, banking and documentation ease the process of importing cargo.
The process of hiring a freight forwarder is straightforward even though you have to go through special considerations.
Some of the factors that you need to look at include:
i. The experience of the freight forwarder in the transportation of the goods from China to Canada.
ii. In many cases, you should use the freight forwarders that another importer recommends as they are reliable.
You can easily get a good freight forwarder online with the reference from importers you can trust.
Most of them are available in Canada even though they handle issues in China.
You can take advantage of Tj chinafreight to assist you in getting a reliable freight forwarder in Canada.
Consider Finding a Licensed Customs Broker
In the line of importing goods from China to Canada, you can also get assistance from a licensed customs broker.
A customs broker will assist you in preparing and submitting the relevant documents to obtain the necessary permits from the government.
They can also organize for transshipment of the cargo within the country through different provinces such as trucking services.
As an importer, you need to look for a customs broker who specializes in the type of cargo you need.
Customs brokers have specialties in clearing and transporting different types of cargo such as perishables, apparels, among other types.
You can easily find a customs broker situated at the destination port ready to receive a different form of cargo.
Be careful when looking for a customs broker as they need to obtain the necessary license before acting as customs brokers.
Some of the duties of the customs brokers include:
i. Advising you on the proper procedures of importing certain types of cargo.
ii. Transacting the business of customs clearance for the client as they have the necessary knowledge and experience.
iii. They will submit the necessary documents to the relevant authorities for processing. The process of submission can be electronic through mails or fax and then wait for feedback.
iv. They will follow up on the clearing process of the goods at the port and organize for warehousing for the goods. In certain circumstances, they can arrange for the transport of the goods all the way to the point you will specify.
v. The customs broker can either decide to pay for the goods and bill the client later. Apart from that, they can be in direct contact with a client who will be paying when it is necessary.
vi. They should also be careful with the documents and keep them well for future reference.
The customs broker has to have the relevant license and keep permits that will allow them to operate in certain provinces.
They should also get the relevant authority or power of attorney from the client to transact business on their behalf.
There are clients who allow the customs broker to have unlimited power of transacting business on their behalf.
Determine Canada Import Duties from China
Import duty is the tax that you will pay to the customs authorities of Canada for importing goods into the country.
The amount of import duty that you will pay will depend on the type and value of the goods.
You can refer to import duty as the tariff, customs duty, import tariff or import tax depending on the context.
Canada charges import duty on goods to raise income for the country and also to discourage import of certain goods.
The country will try as much as possible to discourage foreign product and give more advantage to lo0cal goods.
It is important as an importer to get goods that will not attract high import duty.
Importing from China to Canada Taxes
You will have to pay a certain amount of tax for the goods that you import from China into Canada.
With the right tariff classification number, you are in a position of determining the right tariff for your goods.
It will, in turn, be important in determining the amount of duty you will pay for importing cargo from China.
Goods originating from China will fall under the Most Favored Nation tariffs as they are subject to reductions and trade agreements.
You are most likely to enjoy the bene
fits of the trade agreement as it covers certain costs but you have to provide proof of origin.
It is also important to find out if the cargo is subject to goods and service tax (GST).
GST is chargeable on the goods at a rate of 5% of the total value of the goods under the Canadian law of excise tax and duty.
There are certain types of goods that do not require you to pay any form of tax as they enjoy tax exemption.
In case your goods fall under this category, you should indicate the code of tax exemption clearly on the documents.
Some of the goods that are subject to excise tax include air conditioners, certain passenger vehicles, and certain fuels.
Certain goods subject to excise duty are certain alcohol and tobacco products.
After determining the tariff treatment that your cargo will receive, it is important to know the value of duty to pay.
In many cases, you pay the value of duty to the vendor and he will give you a sales invoice or a receipt as proof.
The document from the vendor has to:
i. Provide a complete description of the goods that you are importing
ii. Indicate clearly the cost of purchasing the goods or the selling price of the cargo
iii. State clearly the terms and conditions for transacting the business.
Remember to indicate the value of the duty in Canadian dollars for easy reference and calculation.
There are six methods of valuation for the goods and you will have to go for the first method of valuation.
To get the real value of duty, make sure that you satisfy all the requirements in the transaction properly.
How to Use Canadian Duty Calculator
With every detail in check, you are now able to calculate the value of the duty that you must pay to the customs department.
Look at the value of the goods on the receipt and convert it to Canadian dollars using the exchange rate of the payment date.
Many importers often think that purchasing the product at a cheap price will be the end and not considering tax.
To avoid a blow when you arrive in Canada make sure you calculate the amount of duty that you should be paying.
You can use the Canadian duty calculator to assist you in getting the right value of duty to pay the customs department.
Before doing the calculation make sure that you have the following:
i. Original value or cost of the cargo
ii. The charges you will pay for the inspection
iii. Logistics and brokerage fees
iv. The complete cost of shipping
v. Province where you reside or where you have the business
vi. Category of the goods that you intend to import such as electronics, baby items, automotive among others.
vii. The type of product that you want to import
viii. Decide on the type of product and also the sales tax on the product
After filling in the entities with the information you will get an estimate of the value of duty to pay.
The value of duty will vary depending on the type of product that you intend to import.
You should know that goods will attract GST, PST and or HST according to the province the goods are going.
What are the two main classifications of incoterms available?
Identify Goods to Import from China to Canada
Business or trade is all about getting goods from one place and selling it for a profit.
In this case, you are getting goods from China to Canada for reselling.
First, you have to identify the type of goods you are importing from China to Canada.
To avoid wasting your money and time, you have to know the type of goods you need for your business.
Gather all the information about the type of merchandise you intend to import before making the order.
When you are identifying the goods, you need to look at the following:
i. Descriptive literature about the goods that you need
ii. Information about the composition of the products
iii. Samples of the product that you intend to import from China.
This information will help you when you will be determining the classification of your tariffs.
It will help you in getting a tariff classification number or the HS code.
This will be useful when identifying the rate of duty for your merchandise.
There are certain recommendations about the type of products you can choose from and they include:
i. Getting products that you are passionate about working with
ii. Getting products that are unique and will enable you to resell at a higher value
iii. Getting products that ship in bulk and have low shipping cost per unit
Apart from knowing the type of goods that you intend to import, there are other things to worry about.
You should find out if the goods you are importing are going to get access into the country.
There are some goods that Canada will not allow into the country and that has to be on your mind.
How to Find Chinese Supplier when Importing from China to Canada
Having the knowledge of all the information on tax and freight forwarding may not be useful without a supplier.
As an importer, you have to go through all the logistics of finding a credible supplier for your goods.
Finding a supplier is not so difficult as you can take a trip to China or find one in Canada.
The type of supplier that you need to find will vary depending on the type of goods that you need to import.
There are goods that are already available but there are others that require manufacturing from scratch.
These are the types of goods that wi
