If you’re an e-commerce seller outside of Canada, the Non-Resident Importer (NRI) program means you can sell to Canadian customers, even if you’re not based there physically. This is a significant opportunity to expand into this market and grow your online revenue.
In this guide, you’ll learn all about the program, including key benefits, responsibilities and how to get started. As a result, you’ll be able to import into Canada with ease, avoid customs delays and pave the way for business growth.
What is a Non-Resident Importer (NRI)?
A Non-Resident Importer (NRI) is a business that imports into Canada and acts as the Importer of Record, even though they aren’t based in the country physically. This means you’re responsible for customs clearance and requirements. The program is a cost-effective way to reach Canadian customers for e-commerce sellers, and comes with many benefits for businesses and consumers alike.
Benefits of Being a Non-Resident Importer
If you’re based outside of Canada and import your goods, then you don’t pay for employees, warehousing and distribution in the destination country. As an NRI, you also have complete control over shipping, meaning you can consolidate shipments. This can, in turn, significantly reduce your business costs.
With the NRI program, you control the entire shipping process door-to-door. This means you can create an efficient and consistent process. As a result, you can reduce delays and improve delivery times for customers.
By taking part in the program, you can deliver directly to customers, without the additional costs usually associated with buying products from other countries. With Delivered Duties Paid (DDP) shipping, you pay the costs of delivering to the customer, and they only pay the online price. In other words, the customer incurs no hidden fees. They also don’t have to be involved in the importing process, making it a much smoother process for them.
One of the main advantages of being an NRI is that the cost of your imported products is similar to domestic products. Therefore, you can sell to Canadian customers at the same – or better – prices, all without the overhead costs of employees and a physical office.
Responsibilities of Being a Non-Resident Importer
Canada provides tariff classification via the Harmonized System (HS) from the World Customs Organization (WCO). Your HS code is required to determine your taxes and duties. Therefore, you need to make sure yours is correct on any documentation you submit.
North American Free Trade Agreement (NAFTA)
NAFTA is a treaty between Mexico, USA and Canada. It eliminates trade barriers and gives preferential tariff treatment to these countries, as long as they meet the necessary requirements. If you’re based in the USA or Mexico and you’re eligible, you may have to submit additional documentation to prove your country of origin.
All shipments require a commercial invoice. This should include information about the buyer and seller, country of origin, price paid and a description of the goods. If your goods are valued over a certain threshold, you may also have to provide a Canada Customs invoice (CCI).
Certificate of Origin
If you want to take advantage of NAFTA and other preferential tariff agreements, you’ll need to produce a Certificate of Origin.
You may need a permit if your goods are restricted from entering the country. If you’re unsure, check Canada’s import control list for more information. As an NRI, it’s your responsibility to provide this at customs.
With an accurate valuation, you can avoid delays and penalties at customs. And, as an NRI, it’s your job to provide this information.
The most common valuation method is the ‘transaction value method’. This is where the value of the goods on the invoice is the same as what the customer paid for the item(s). However, if the goods aren’t sold for export, or the purchaser isn’t in Canada, then you’ll need to use an alternative method.
Valuation can become complex very quickly, which is why it’s advisable to work with a customs compliance specialist to help you.
As the Importer of Record, you’re responsible for paying the duties owed on imported goods. Duties are determined by your tariff classification and country of origin.
You’ll need to pay Goods and Services Tax (GST) at a rate of 5 percent. This is calculated based on the value of the goods, including the value of any customs duties.
How to Become a Non-Resident Importer
1. Apply for a Business Number (BN)
You need a Business Number (BN) from the Canada Revenue Agency before you can begin importing into Canada. This means your business can interact with the Canada Border Service Agency (CBSA) and Canada Revenue Agency (CRA). To get started, register for a Business Number online.
Once you register for an import/export account, your account number will include your BN. This account should only be used when importing and exporting.
2. Register as a Non-Resident Importer
To become an NRI, businesses must register with the Canada Border Service Agency (CBSA).
3. Register to CARM
You need to register and make duty and tax payments via the CARM Client Portal. As of October 2023, it will be mandatory for you to manage customs/payments via this method.
You must also post your financial security, or surety pond, to be part of the Release Prior to Payment Privilege (RPP) program.
How Zee Can Help
There are lots of complex laws, regulations, taxes and duties you need to be aware of when importing into Canada. If you’re a seven-figure e-commerce business, there are risks if you don’t have customs expertise. If managed incorrectly, you could face penalties, fees and legal action.
By partnering with Zee, you can enjoy smooth customs clearance to over 200 destinations, including Canada. Leverage our extensive experience to get your goods cleared, every single time.