There are many goods that on getting imported get levied upon by import taxes such as the GST pursuing to the Excise Tax Act. This is levied at about 5%. Many non-residential importers are having problems related to these import tax payment issues.
- Many provinces of Canada have harmonized their tax slab rules. They have included the sales tax rules with the GST and are imposing HST at very high rates of about 13-15%. Any individual who is associated with the GST or the HST authorities might claim an input tax credit to claim back these taxes. But for that to happen, they must obtain a business number. Only then can they apply or register to the GST or HST departments.
- Two points of the Excise Tax Act assign tax points to the non-resident importers. But the confusion in these tax points is the biggest drawback for these importers.
- The 2nd division of the tax act imposes GST and HST on the domestic supply of goods. These are only applicable to these tax registrants but also include the non-resident importers in it. But the tax act does not specify when and where to pay the taxes. This is another confusing point for non-resident importers.
- The 3rd division of the tax act imposes GST and HST on imported goods. But these taxes are paid and collected under the customs act where the interests and penalties get calculated. However, this creates a difference of information that leaves the importers perplexed about the levy of the customs duties.
- There are several traps laid for the non-resident importers to recover their GST. They must be well aware of the complex constructive importer provisions that the tax acts bear. This solely entitles to let the importer find out if they are entitled to claim any ITC. These are mostly applicable in cases when the supplier supplies goods to importers outside Canada, agrees to perform both as an importer and a supplier or pays import GSTs.
- A solution to these issues is not that overtly complex. It is easy for a recipient to claim the ITC if their supplier can provide it with the necessary import documents. A registered supplier will also be able to deliver goods in Canada.
With such complex rules and traps on the list, it is always better to hire experienced professionals and this is where Clearit customs clearance solutions will keep you aside from these troubles.