DIFFERENCES BETWEEN SHIPPING IN THE USA VS. SHIPPING IN CANADA

 Canada is currently the United States’ second-largest trading partner. One of the most significant differences in shipping to Canada versus from Canada is the vast size of the country and the unique shipping considerations required. 

To help you with your shipping needs to the United States from Canada, AFM Logistics has in this article explored some of the key differences between shipping to the US and shipping within Canada, shedding light on important factors that businesses should consider. Whether you are an everyday shopper or a business, best shipping company in India can easily make you save up to 50% on your international shipping costs by way of accessing our group buying power.

 

1.     Differences in Taxes

Taxes play a significant role in shipping operations, and the tax systems in the United States and Canada differ in various aspects. There are no taxes imposed on freight shipping in the USA for regular-sized shipments. 

On the other hand, Canada has a Goods and Services Tax (GST) and a Harmonized Sales Tax (HST), which vary depending on the province or territory. For shipping purposes, you only need to worry about the GST which is applied to all shipments within Canada and varies depending on the province.

Understanding these tax systems and ensuring compliance is essential for accurate cost calculations and legal compliance when shipping within each country. Of course, as with everything else shipping-related, our mission is to make it easier, which is why the HST is automatically calculated for you during checkout when shipping within Canada with AFM Logistics.

2.     Customs Clearance and Documentation

Shipping cross-border requires adherence to customs regulations and proper documentation.  This process requires the necessary paperwork, including commercial invoices, a bill of lading, and sometimes, customs declarations. 

Shipping experts at AFM Logistics  are here to help you every step of the way, and our easy-to-use system helps make sure that even a brand-new shipper has an easy time getting everything in order ahead of time.

One difference between shipping to the USA from Canada and to Canada from the USA is that in one instance you will use a customs invoice, while in the other you’ll use a commercial invoice. They serve the same purpose and often look the same, but a difference exists nonetheless.

When you ship items from Canada to the US, the Customs and Border Protection (CBP) service will oversee the process to prevent illegal and potentially risky items from entering the US.   

You are required to pay customs duty and tax on the items you want to ship items across the US border. There are exemptions on certain items from specific countries due to various international trade agreements. 

A customs entry can be a Section 321 entry, a formal or an informal entry:

Section 321: Items with a valuation of $800 or less are generally duty-free and fall under the Section 321 entry.

Commercial or Formal Entry: Commercial or formal entries are shipments with a valuation of more than $2,500.

Informal Entry: Generally, informal entries have valuations of more than $800 but less than $2,500.

According to the CBP, all shipping freight forwarding companies associated with formal shipments  from Canada to the US should have the following:

An Importer ID Number: It is either your social security number or IRS business registration number.

Bill of Lading (BOL): A Bill of Lading is a requirement when picking up a shipment and your freight company provides it.

A Commercial Invoice: A Commercial Invoice outlines a description of the shipped item (s), including their estimated value. You need to send a copy of the invoice with the BOL and one with the US-bound freight.

An Import/Export License: Special import or export license might be required if your shipped item is regulated.

The USMCA Certificate of Origin: Countries such as Canada, the US, and Mexico use the USMCA Certificate of Origin. It certifies that a shipment is eligible for the preferential tariff treatment agreed between the USMCA. 

Informal entries usually require a commercial invoice only. However, a USMCA Certificate of Origin can make the shipment seamless. 

Along with the difference in nomenclature, both countries have different processes and requirements for customs clearance. 

 Transit Times and Carrier Networks

Transit times can vary between shipping within the USA and shipping in Canada due to factors such as distance, and carrier networks. While both countries have well-developed transportation infrastructure, USA’s railways, for example, are unmatched and you may find lower rail coverage within Canada than in the USA. 

Another difference between Canadian and US carriers is the truck height. Some USA-based carriers have slightly taller trucks than their Canadian counterparts, allowing them to move taller freight. This, of course, doesn’t apply to all of them, but it’s important to be aware of this difference in case you’re looking to ship something slightly taller than the standard.

 

Shipping Tips: What You Should Know Before Shipping Between Canada and the U.S.

Cross-border shipments between Canada and the United States require a lot of time and pre-planning. Here are some tips to help you have a better experience:

 

Do your research: Make sure you have taken advantage of all available free resources. Both Canada and the United States trade embassies have made shipment and border clearance requirements accessible online.

Allow for an extended transit time: In winter months, send out your shipment several days early if possible in case there are delays. 

Remember the paperwork: Missing and incomplete documentation is among the top causes for border clearance delays — make sure you fill out all paperwork ahead of time and consult with your broker, if applicable.

Consider insurance: If you are shipping high-value or fragile items, consider insuring your shipment to be safe.

Keep records: The Canadian Border Services Agency recommends you keep records of your exports for at least six years following the date of export.

Use a trusted service: Use a delivery and logistics service with experience in cross-border shipments between the United States and Canada, like Purolator International. An experienced company with knowledge of Canadian procedures will streamline the shipment process and give you valuable peace of mind.

 

CONCLUSION

Shipping in the USA and shipping in Canada present unique challenges and considerations. From the National Motor Freight Classification system in the US to the differences in tax systems, customs clearance, and transit times, understanding these distinctions will help you make more efficient and cost-effective decisions. 

Top freight forwarding companies in India   stays  informed about the specific requirements and regulations of each country so that businesses can navigate cross-border logistics successfully and provide exceptional service to their customers.