*Disclaimer: By no means am I an expert in this field. I find myself repeating a lot of what is said here and upon request I decided to make a thread for Canadians so they know the types of charges they will have to pay when buying online. As well, tips and ways of avoiding most of these fees.
Before I begin, it’s important to understand the types of fee you will have to pay and what they all mean. For more information, you can look at the Canadian Border Service Agency (CBSA):
www.cbsa-asfc.gc.ca/publications/pub/rc4051-eng.html
Duties: This is what you will have to pay most of the time. It is the fee that our government charges to preserve our domestic economy. That means any product that the origin manufacturer is outside of North America, you will have to pay duties. It is typically 20% of the declared value. This fee is a fixed percentage and the CBSA has an entire index for every type of good imported into the country. So basically they just look in the index, find out what type of good it is and slap a flat rate % on the value.
Brokerage fee: This is the fee that couriers such as UPS, FedEx, and DHL will charge for declaring customs on your behalf. Basically this is their personal service charge for signing papers that takes 5 minutes of their time and the money to front for you. If you live close to the border which is Fort Erie in my case, then you can call the courier and tell them you will declare customs yourself. This must be done prior to your package entering our borders.
Taxes: I’m sure we all know what this is by now. You will have to pay taxes if the declared value is more than $20. If it is declared as a gift, it is more than $60. So to avoid paying taxes, the package must be less than $60 CAD and marked as gift. If it is over $60 and they believe that it is a gift, you will only be taxed the difference.
Couriers:
USPS: The best shipping option for Canadians. They charge a flat rate of $5.00 for every parcel that requires the payment of taxes. So that means if it is a gift valued less than $60 CAD you won’t have to pay a single thing! From all my experiences, I have not lost a single package which seems to be one of the reasons why online retailers will not use them. They claim it’s unreliable and they have lost packages from experience. I have never had to pay duties for products made outside of NAFTA.
The most economical method of shipping is First Class International. It typically takes 15 business days to arrive at your local post office. The most popular is Priority Mail which takes around 12 business days. Depends if you really want to save every penny or want it to arrive at a decent rate.
FedEx: In terms of cost, they are practically the same as DHL. They charge a processing/brokerage fee of $7.00 per package. You’ll also have to pay duties and taxes on top. From experience, I’ve had to pay around 30% on the declared value of the package.
My closest pick up location is on Nugget, near Scarborough Town Center. I find it inconvenient since I’m never home when they deliver. FedEx will deliver before 2pm. After that, they do pick ups.
UPS: In terms of fees, UPS is the highest out of all the couriers. I used to think they were terrible and avoided all orders that used them. However, after doing more research I find a method that would make them very ideal. When you use UPS Standard (Ground), expect to pay a ton. Their fees can be found here:
www.ups.com/content/ca/en/shipping/cost/zones/customs_clearance.html?srch_pos=3&srch_phr=brokerage+canada
If you use UPS Expedited, you pay more up front of the shipping cost. However, you will save more all together assuming your order is at least $200 declared. You won’t have to pay brokerage fee of $40.30 + advancement fee 2.7% or $5.85 min whichever is higher + $4.25 C.O.D. fee. You only have to pay duties and taxes.
DHL: They charge a $7.00 flat rate fee for processing your package past customs. This is the courier that Karmaloop uses. I’m not very fond of DHL, despite the same fees they charge as FedEx. My local DHL facility while it’s closer than FedEx, it looked very ghetto. No signs, a small room with a kiosk. The person working there had to go to the back to get me change for $2.42. It took her 10 minutes. What kind of business has no float or cash worth $2.42? This was the beginning of the day too.
Their pickup facility was at 14th and Warden which is really close if you live in Markham or Richmond Hill.
Summary: Buy from retailers that will use USPS and are willing to mark down the value for you. Second option would be to use UPS Expedited, recommended for orders over $200. The last option would be FedEx/DHL, this is personal preference and will depend on how close the pick up facility is to your house.
Online Stores: This is a list I have compiled which I found uses USPS and will mark down the value. Very often they do this automatically, but it is always nice to e-mail them ahead of time or make note of it at PayPal. You also need to understand that it has to be believable. If you’re ordering a quantity of 6 items, it’s hard to believe that it is worth $60.00 combined.
www.eastwestworldwide.com – They have a toll free number. I like the fact that I can place my order with a human being and even get discounts at times.
www.boundlessny.com
www.ftkonline.com
www.digitalgravel.com/
shop.80spurple.com/
www.oneanthem.com/store/pc/home.asp
www.turntablelab.com/ - They use UPS ground, but they pay for all the brokerage fees for you. So the price you pay is the final price.
www.karmaloop.com - DHL
*Will update as needed.
