Tax - Customs Verification

IMPORTANT FOR IMPORTERS

Are you at risk for penalties?

Every year, the Canada Border Services Agency (CBSA) targets importers of certain products to verify that the information reported about them was correct. This information includes the tariff classification, value, and origin of the goods. Getting even one of those pieces of information wrong can lead to either an underpayment or overpayment of duties, penalties, and interest.

When Canadian companies are non-compliant with the Canadian import rules, they are at risk for hidden costs that could impact their bottom line. BDO Canada’s Customs & International Trade Services (CITS) Team can help you navigate CBSA’s verification process to help mitigate the risks of penalties. Whether you have already received your verification letter or need to get ahead of an audit by conducting a review before you are selected, we want to help try to reduce your exposure.

Some of the priority goods that are targeted for verification this year are:

Tariff Classification

Spent fowl
LED lamps
Furniture for non-domestic purposes
Batteries
Footwear (>$30/pair)
Parts of lamps
Pasta
Cell phone cases
Pickled vegetables
Gloves
Bags
Other mountings and fittings, suitable for furniture
Air heaters and hot air distributors
Flashlights and miner's safety lamps
Stone table and counter tops
Parts of machines and mechanical appliances
Other chemical products
Bicycle parts
Parts of ruse with Machinery of Chapter 84

Valuation

Apparel
Footwear

Origins

Contact the CITS team to help you navigate CBSA's verification process and mitigate the risks of penalties

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VERIFICATION PROCESS

What does the CBSA verification process involve? The following is a step-by-step overview of the process:

Importer will receive notification from CBSA that the importer will be audited.
CBSA chooses a sampling of import entries and asks the importer to provide documentation in respect of those entries (invoices, descriptive literature, etc.)
CBSA reviews the requested information and issues an interim report of findings to the importer.
The importer is given the opportunity to dispute the findings or provide further information within 30 days of receipt of the interim report.
After the 30 day time frame has elapsed, CBSA will issue their final report.
If errors have been noted by CBSA, the importer will be required to correct all entries of the same or similar goods, retroactively up to four years. Duty and interest, if applicable, will be assessed against the importer.
Monetary penalties may also be assessed, depending on the infraction.

CURABITUR FAUCIBUS MAGNA

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We’re here to help. Contact one of our Customs & International Trade Services (CITS) professionals today to receive the latest information on customs and tariffs, and help you navigate the CBSA verification process.

BRIAN MORCOMBE

Partner, Indirect Tax Practice Leader

905-946-5406
[email protected]

CHARMAINE GODDEERIS
Senior Manager, Customs and International Trade

905-946-1066
[email protected]