Shipping to Canada involves more than just freight costs. To avoid surprise charges upon delivery, shippers and importers must understand the "Landed Cost"—which includes Duty, Taxes, Brokerage, and Carrier Surcharges.
Quick Summary: The 4 Main Import Costs
- Government Duty: Determined by the product type (HS Code) and origin.
- Sales Tax (GST/HST/PST): Applied to the duty-paid value of the goods (5% to 15%).
- Carrier "Brokerage" Fee: The cost to prepare the customs entry (often extra for Ground shipping).
- Disbursement Fee: A fee charged by the carrier for paying duties on your behalf (~2.5%).
Our team has updated this guide for 2026 to help you navigate duty-free thresholds, free trade agreements (CUSMA/USMCA), and the new CARM system.
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Duty-Free Thresholds: When Do You Pay?
The "De Minimis" threshold determines the value at which goods can enter Canada without duty or tax. This varies depending on the shipping method and the country of export.
| Shipping Method | Origin: USA and Mexico (CUSMA) | Origin: Rest of World |
|---|---|---|
| Courier (FedEx, UPS, DHL) | Under CA$40: Duty and Tax Free CA$40 to CA$150: Duty Free (Taxes Apply) Over CA$150: Duties and Taxes Apply |
Under CA$20: Duty and Tax Free Over CA$20: Duties and Taxes Apply |
| Postal Mail (USPS, Royal Mail) | Under CA$20: Duty and Tax Free Over CA$20: Duties and Taxes Apply |
Under CA$20: Duty and Tax Free Over CA$20: Duties and Taxes Apply |
Important Note: The CUSMA (USMCA) thresholds apply to the place of shipment, not just the origin of goods. However, to qualify for 0% duty on items over $150, the goods must be "Made in the USA" or Mexico.
Breakdown of Import Fees
1. Customs Duties
Duty is a tax on imported goods established by the Customs Tariff. It is calculated based on:
- The Value: Usually the transaction value (price paid).
- The Commodity: Determined by the HS Code classification.
- The Origin: Where the goods were manufactured (not just shipped from).
Example: Clothing often has high duty rates (16% to 18%), whereas electronics like laptops are often duty-free.
2. Sales Tax (GST, HST, PST)
Even if an item is duty-free, it is rarely tax-free. The government collects tax on the Duty Paid Value (Value of goods + Duty).
- GST (5%): Applied to most imports.
- HST (13% - 15%): Applied in participating provinces (ON, NB, NS, PE, NL).
- PST: Provincial tax applied in BC, MB, QC, and SK.
Essential Tools and Resources
Carrier and Brokerage Fees
This is the most common source of confusion. When you ship via FedEx, UPS, or DHL, they act as the customs broker on your behalf.
"Entry Preparation" Fees
Air / Express Shipments: Usually, the brokerage fee is included in the shipping price.
Ground Standard Shipments: The brokerage fee is not included. For ground shipments from the USA, carriers charge an "Entry Preparation Fee" based on the value of the goods.
Download: 2026 FedEx and UPS Ground Fee Chart (PDF)
Disbursement and Admin Fees
If the carrier pays duty and taxes to Customs on your behalf, they will charge you a fee to recover that money. This is typically 2.5% of the amount advanced, with a minimum fee of around CA$15 to CA$20.
CARM: The New Standard for Importers
The CBSA Assessment and Revenue Management (CARM) project has modernized how commercial goods are imported. All commercial importers must register in the CARM Client Portal (CCP).
Why it matters:
CARM changes how importers view their accounts, pay duties, and authorize customs brokers. Without registering, your shipments could be delayed at the border.
Frequently Asked Questions
How can I avoid brokerage fees on ground shipments?
You can "self-clear" the package at a local CBSA office. You will need the manifest or waybill number from the carrier. Alternatively, upgrading to an Express/Air service often includes the brokerage fee in the shipping rate, which can sometimes be cheaper overall than Ground + Fees.
What is the difference between "Shipped from USA" and "Made in USA"?
This is crucial for CUSMA/USMCA duty-free benefits. "Shipped from USA" means the goods crossed the border from the US. "Made in USA" means the goods were manufactured there. Only goods made in the USA/Mexico qualify for 0% duty under the trade agreement (if over CA$150). Goods merely shipped from the US may still be subject to duty if they were made in China or Europe.
Do I pay import fees on personal gifts?
Gifts sent to Canada worth CA$60 or less are generally duty and tax-free. If the gift is worth more than CA$60, you must pay duties and taxes on the excess amount.
Why are fees lower via Canada Post?
Canada Post charges a flat CA$9.95 handling fee per dutiable package, which is often lower than commercial carrier brokerage fees. Additionally, anecdotal evidence suggests that random inspections occur less frequently on low-value postal items compared to courier shipments, though the legal obligation to pay duties remains the same.
How do I register for CARM?
You must obtain a Business Number (BN9) and an Import-Export Program account (RM) from the CRA. Then, visit the CARM Client Portal to link your business account. View our Full CARM Guide.
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