If you're shopping a U.S. web site, there are things you should know before plugging in your credit card number. Unless the merchant or its shipping center are based in Canada, you may need to figure in shipping, exchange rates, customs, taxes and custom brokerage fees.
Here are seven factors you should consider before finalizing that purchase at a U.S. website. Keep them in mind for a happy and safe online-shopping venture.
1. Shipping to Canada Availability: Before you even begin to shop, you'll want to check whether the site offers shipping to Canada. It's incredibly irritating to reach the last page of your purchase and find you'll have to make a trip south of the border if you want to pick up that purchase.
2. Shipping Charges: Valid sites list their international shipping policies and procedures up front, usually on the Q&A, Customer Service or Help pages. Some sites charge a flat fee for purchases under a set amount and offer free shipping for purchases above that figure. Others determine shipping charges by weight, size, distance and speed of delivery. Read the details carefully.
3. Exchange Rate: Remember to factor in the exchange rate as well as the cost of the merchandise. Yahoo offers an easy-to-use currency converter. Your credit card company may also add a charge for currency conversion.
4. Customs Duties: The North American Free Trade Agreement ensures Canadians don't have to pay duty on most American and Mexican manufactured items. Beware, however, as items purchased from a U.S. merchant aren't necessarily made in that country. Duty will have to be paid on items imported into the U.S. The U.S. merchant you are shopping with may cover the duties, so check before you buy.
Duties vary widely, depending on the product and the country in which it was manufactured. Depending on the item, other charges and duties may also apply. For example, excise duty and excise tax apply to such luxury items as jewelry. In general, Canada Customs doesn't assess goods from a foreign retailer unless they can collect at least $1 in duties and taxes. For more about Canada customs and duties, contact your regional Canada Border Services Agency office or the Border Information Service.
5. Taxes: Nearly everything imported into Canada is subject to a 5-percent Goods and Services Tax (GST), calculated after customs duties have been applied.
Your purchase may also be subject to a Canadian Provincial Sales Tax (PST) or Quebec Sales Tax (QST). The provincial retail sales tax rates vary from province to province, as do the goods and services to which the tax is applied and the way the tax is applied.
Residents of New Brunswick, Nova Scotia, Newfoundland and Labrador pay a flat 13-percent Harmonized Sales Tax (HST), instead of the separate GST and PST.
6. Canada Post: Canada's primary postal operator automatically applies a processing fee for each package that clears customs. The U.S. merchant you are shopping with should have included this in their shipping fees.
7. Customs Brokers Fees: Customs brokers service fees can catch you by surprise. Courier companies and postal services use customs brokers to get packages processed through Canada Customs at the border and pass that charge on to you.
Customs brokers fees for courier companies are usually a good deal higher than fees charged by Canada Post. Some courier companies roll the custom brokers fees into the courier service price, depending on the level of courier service you select. Others will add the customs brokers fees on top and you'll pay those charges before receiving your purchase.
If you select a courier service, check whether the you'll also be charged a customs broker fee. If you can't find information detailed on the merchant's web site, check the service guide on the individual courier company site or call the courier company's local phone number.