With the arrival of Harmonized Service Tax (HST), a number of goods and services have been affected. Customs Brokerage fees are one of those services that importers will now have to pay the greater tax of HST rather than GST (in most cases). Whether or not you pay the HST is based on the rules of supply and if you are importing commercial or personal goods. The Canada Revenue Agency (CRA) Bulletin B-103 on the rule of supply is a good source. It is recommended all importers with questions take a few moments to review here.

A basic breakdown of whether or not you pay GST or HST is below:

GST/HST On Customs Brokerage Charges

Non-Commercial Imports

  • GST/HST on Brokerage charges will be the same rate as the Customs GST/HST rate (the rate imposed by the recipient resident's province).

Commercial Imports

GST/HST On Brokerage Charges Applies As Follows

  • Non-Resident Importers (NRI) will continue to be zero rated if not registered for GST/HST
  • Resident Importers are subject to the GST/HST rate in the province of entry (where actual Customs clearance takes place).
  • Refunds/drawbacks/consulting fees are subject to place of supply rules, meaning GST or HST rate is charged based on recipient?s province.

GST/HST On Imported Goods

  • Non-commercial (casual) goods - GST/PST/HST applies to imported goods at the rate imposed by the recipient resident?s province.
  • Commercial goods- only subject to the GST at time of import. HST and/or PST are not applicable to the commercial goods.

If you have questions feel free to contact our Client Services Team at 888.538.1566.

Trade Advisor Compliance Regulations
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About Author
Ronnie Rai
CCS

Ronnie Rai is a Business Relationship Specialist with Pacific Customs Brokers, Canada she has over 25 years experience in logistics, customs and supply chain management. Ronnie had her start in running small freight company in the early nineties. Ronnie has vast experience in distribution, lumber, and manufacturing industries. Her credentials include the following Office Administration Diploma at CDI, Certified Customs Specialist Designation (CCS) and Certified Trade Compliance Specialist Designation (CCTS) with the Canadian Society of Customs Brokers.

While we strive for accuracy in all our communications, as the Importer of Record it is incumbent upon your company to ensure that you are aware of the requirements under the new regulations so that you maintain compliance as always.