How to Sell on Amazon FBA Canada (Amazon.ca) in 2022
Updated in 2022 with up-to-date selling information for selling in Canada.
Are you looking to start selling on Amazon FBA Canada? If you're a Canadian, Amazon.ca is arguably the best marketplace to start with. And if you're from America or anywhere else who's already selling on Amazon.com, Amazon.ca is an easy way to boost your sales by 10 to 20%.
In this guide, I'll show you how to start selling on Amazon.ca, whether you're a Canadian or non-Canadian.
Topics Covered
Related Reading: How to Sell on Amazon.co.uk
Check Out Our FBA for Canadians Facebook Group
Are you a Canadian selling on Amazon? Check out our exclusive Facebook group for Canadian Amazon sellers.
Why Should You Sell on Amazon FBA Canada?
- Get around 10% to 20% boost in sales
- Much fewer competition compared to Amazon.com
- Build up your listings and reviews now while the competition is weak.
- Allows you to ship products from Canada to Canadians from non-Amazon sources
- Simpler sales tax
Canada has about 10% of the population of the US so by this, you can expect at least a 10% sales boost for any one product by selling in Canada. For example, consider the Instapot shown below. According to Helium 10, it has sales of roughly $535,000 in Canada. In the United States, the sales are roughly $2.5million for the same model. In other words, Canadian sales are roughly 20% of what they are in Canada.
The reason why many products punch above their weight in Canada (i.e., they get more sales than expected for a population of Canada's size) is the fact that the competition in Canada is much less fierce. You can potentially easily rank a product on Amazon.ca that you might have no chance of ranking for on Amazon.com.
As Amazon.ca becomes more popular with Canadians, the competition will continue to increase. For this reason alone, I think if you have goals of one day expanding to Canada, now is the time to solidify your reviews and rankings in Canada and get a first-mover advantage.
One of the other benefits of selling on Amazon.ca is that you can use multi-channel fulfillment to ship Canadian orders from your website to Canadians direct from Canada (you cannot use MCF for international orders). This avoids duties and long transit times and is a big positive for Canadians.
Canada's sales tax is also much more simple than many other regions (specifically Europe), and Amazon will collect federal sales tax for you in most cases (see more details in our sales tax section below).
What Is North America Remote Fulfillment and Should You Use It?
In 2019, Amazon rolled out something called North America Remote Fulfillment, otherwise known as NARF.
If you enroll in this program, it allows your Amazon.com products to show up on Amazon.ca, and Amazon will ship the products from America to Canada. Amazon will handle all aspects of shipping, taxes, and duties for you and charge them to the buyer. This is the downside with NARF – it adds on extra costs to the customer and the shipping times to the customer are far longer than with inventory physically stored in Canada.
This program is excellent for those people who don't want to actually go through the hassle of sending inventory directly into Canada. However, your sales can often be 90% lower or more when using NARF compared to physically sending inventory into Canada.
Read more about Amazon's NARF program.
How to Add Your Amazon.com Listings to Amazon.ca
Because Amazon now has a Unified North American account, you can easily transfer your listings from Amazon.com and Amazon.ca, and yes, your reviews will transfer.
The easiest thing to do is to use the Add a Product option from the Inventory menu and add your existing ASIN.
By default, Amazon will preload your existing bullet points, descriptions, and images. You can edit your bullet points and descriptions if you want. However, if you change your images, these will be global unless you use the country-specific image upload manager here.
Popular Misconceptions About Americans Doing Business in Canada
Here are some of the things people mistakenly think about Americans selling to Canadians:
- You will have to pay Canadian income tax.
- Product regulations are different and more complex in Canada than in the United States.
- You will need to set up a Canadian bank account.
- Americans can work in Canada without a visa.
We are not accountants, but normally, the income you make in Canada will be exempt via tax treaty (assuming you have no permanent establishment in Canada). The reverse is true for Canadians doing business in the US. Check with an accountant to be sure of your tax liabilities though. However, you will definitely be subject to a sales tax liability once you surpass a certain sales threshold.
As for product safety requirements, labeling, etc., they are normally very similar to the US (as opposed to, for example, Europe, where they are much different). As always, though, check with a customs broker to be aware of any potential importing requirements before importing.
Canadian French Labeling Requirements
Canada has a significant French population, particularly in Quebec. By law, all mandatory label information should be shown in English and French except the dealer's name and address. This normally includes the product name and net quantity/measurement information. Directions for use, promotional/marketing statements do not have to appear in French.
This information is generally not checked upon import and, for better or worse, many private label sellers do not adhere to these labeling requirements.
For more information, see here: http://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/01248.html
To sell on Amazon.ca, you can continue to use your American bank account and Amazon will simply convert the funds into US Dollars (normally with about a 3.5% commission). There's no need to set up a Canadian bank account.
As an American, you cannot come to Canada to work without a Visa. There are certain activities you can perform in Canada for business, like visiting an accountant, visiting a client, etc. In other words, you can sell your goods on Amazon.ca and essentially pay good Canadian employees to ship your products, but you can't open up your own warehouse and start shipping products yourself without getting the proper work visa.
Things to be Aware of When Selling on Amazon FBA Canada
- Amazon FBA fees may be higher in Canada.
- The exchange rate is volatile.
- Canadian duty rates are often higher than the US.
- No Amazon-partnered carriers are going to Canada
- You need a Business Number to formally import anything into Canada
- If sending UPS/FedEx etc. to Canada, make sure you send them DDP (Delivered Duty Paid) otherwise, Amazon will reject the shipment
- Canada has a federal sales tax (GST)
As you're trying to calculate your potential profitability in Canada, remember that Canadian FBA fees may be higher, depending on the products (especially smaller and lighter items). Make sure to calculate your Amazon FBA fees when deciding your list prices in Canada – don't just assume the Amazon.ca FBA fees are the same as Amazon.com.
You can more or less charge the price you charge on Amazon.com, converted to Canadian dollars, of course. In fact, you might even be able to charge more. However, the exchange rate is volatile. For example, in 2011 the Canadian dollar was actually worth more than an American dollar but in May of 2020, a single Canadian dollar is worth about $0.70US. You want to keep an eye on the exchange rate, if not monthly, then at least quarterly. We adjust our prices many times throughout the year to reflect changes in the exchange rate.
Canadian duty rates also tend to be 25 to 50 percent higher than in the US (ignoring the 2018 China-U.S. trade war).
If you import goods from China into the US and then re-export them to Canada, you have essentially double-paid duties for both Canada and the US (it's technically possible to file to get your US duties back, but the paperwork is very pricy).
Pro-tip: The country of origin of your products never changes. For example, if you import a widget from China to the US and then import it into Canada, Canada still considers that widget “Made in China.”
Also, with Amazon, there are no partnered carriers for shipping your goods from the U.S. to Canada. You need to arrange shipping from the U.S. to Amazon.ca warehouses on your own.
You will also need what Canada calls a Business Number to formally import into Canada. It's easy to file for though.
When you're shipping to Amazon.ca FBA, you must make sure that all duties and taxes are paid prior to arriving at Amazon.ca. With UPS and FedEx, you can ship via “DDP” (Delivered Duty Paid) which will basically have these charges passed on to you and keep Amazon from rejecting your shipment.
Sales Tax and GST/HST
Canada has a federal sales tax that is called GST/HST. Compared to the US, it is extremely simple. Each province sets its GST/HST rate (there are only 13 provinces/territories) and you remit everything in one form.
Furthermore, on July 1, 2021, things got even simpler as Canada rolled out marketplace tax collection (MTC) rules which means Amazon will collect and remit GST/HST for any seller who is not registered for GST/HST.
To complicate things slightly, four provinces set their own provincial sales tax rules: Quebec, British Columbia, Manitoba, and Saskatchewan (however, Amazon now collects sales tax for Saskatchewan. so there are really only three provinces you need to consider).
Not registering will not affect your ability to import into Canada or sell on Amazon.ca, but you are supposed to collect these. Further, Quebec has a significant economic threshold of $30,000 that you may not exceed and Manitoba has a total population of less than 1.4million. For better or worse, many international sellers never register to collect provincial sales tax.
5 Easy Steps to Get Started Selling on Amazon.ca
Here's the easiest way to get started selling on Amazon.ca.
- Send a small shipment to Canada – get your feet wet; Work it up to Pallets.
- List your products on Amazon.ca.
- Turn on Sponsored Ads for Canada!
- Monitor the exchange rate every month.
- Register for GST/HST.
Amazon unified accounts for the USA, Canada, & Mexico
For North America, Amazon has what they call a unified account. This means that within one Seller Central account you can:
- Manage inventory through one interface
- Pay one Professional selling fee
- Have payments remitted to your local bank account (Amazon will convert the funds for you)
This is contrast to selling in Europe, Japan, etc. where you will need to setup another separate seller central account for those countries.
Send a Small Shipment to Canada
As you probably did when you first started with Amazon.com FBA, you probably sent in a box or two of goods to test out FBA, and not a full 20′ container. The same goes for Amazon.ca. Send a box or two via UPS or FedEx to get your feet wet. The procedure is almost identical as sending to Amazon.com.
You will need to send your goods via UPS or FedEx or another service that allows you to be billed for any duties and taxes, also called DDP. Do not send via USPS. If you do Amazon will be asked to pay taxes when your product arrives and they will reject your shipment.
Pro-tip: In America, there is an $800 de minimis value (any orders less than this do not have to pay duties/taxes). In Canada, this de minimis value is just $40.
List Your Products on Amazon.ca
When you will need to select what inventory you want to list in Canada. Recently, Amazon has made it so that you can simply look up the Amazon.com ASIN in the “Add a Product” tool within Seller Central and all the listing data will be carried over.
Your reviews from Amazon.com will transfer over until you get your first review on Amazon.ca
There are also a few other settings like shipping that you need to set-up for Amazon.ca but the whole process should only take a few minutes.
Turn on Sponsored Ads
The first thing you should do once you get your inventory to FBA is start using Sponsored Products if you're using them for Amazon.com. You will pay dramatically less than what you pay for Amazon.com (see our stats below – we're paying just 0.2% ACoS!)
Monitor the Exchange Rate Every Month
When you price your products in Canada, you're likely simply converting from U.S. dollars to Canadian dollars and maybe adding a bit of a cushion. Monitor this exchange rate on a quarterly or monthly basis as it will change and you should change your prices accordingly.
Setting Up a Canadian Business Number
If you're sending goods up to Amazon.ca FBA via UPS or FedEx as a trial, you can likely avoid this requirement for your first couple of shipments. However, once you do any significant volume you need a business number.
If you're sending anything that requires a customs broker to clear (i.e. you're sending an LTL shipment) you will definitely need a Business Number. A business number is simply a number that you can use to collect/remit GST/HST and to import goods into Canada. It's similar to the U.S. EIN.
Registering for a Business Number in Canada is quite easy. You simply need to complete a form RC1. You can fax or mail it in (there's no option to fill it out online) OR just call 1-800-959-5525 and a person will ask you all the questions on the phone and get you setup very quickly. Once you fill it in, you'll be issued a Business Number within 10 days. When you register for this business number you can also get your GST/HST and Importer numbers – this is on the RC1 form you fill out. There are simply check boxes for each one.
Alternatively, your customs broker can register you for a business number for free or a nominal fee (under $500). Pacific Customs Brokers can help you with this (let them know that EcomCrew sent you).
The form is self-explanatory and should take no more than 5-10 minutes (when it asks for social insurance number, simply leave this blank). When it asks for your estimated taxable sales in Canada it's wise to enter something below $100,000 as otherwise you will be required to prepay half of your estimated GST (The Canadian Revenue Agency will determine in your second year if you need to prepay a percentage of your GST/HST).
Pro-tip: If you want someone to set-up your business number and help with your sales tax filings you can contact David at Small Biz Pro – he has a lot of familiarity with non-Canadian sellers on Amazon.ca and can help you get set up for those who don't want to self-register.
Getting Liability Insurance When You Sell on Amazon.ca
No seller wants to be on the receiving end of a product liability lawsuit. No matter how small the chances are of your products malfunctioning or causing harm to customers, it is always wise to be prepared when it does happen.
Liability insurance can be expensive, but there are insurance providers like Foxquilt that give reasonable rates and personalized coverage, i.e., you only pay for the coverage you need. The application is also done completely online, so whether you're selling in Canada, the United States, or both, you can be sure you have Amazon-compliant liability insurance.
Conclusion
Hopefully, this article has outlined my arguments for why you should be selling on Amazon.ca (as well as who shouldn't be) and also how to get up and rolling. Since late 2015, Amazon.ca has been a significant driver of growth for my company and I think it can do the same for a lot of other companies seeking 10-20% sales growth.
Have you had any experience selling on Amazon.ca or other Amazon market places? Do you have any questions about selling on Amazon.ca? If so, comment below.
Hi Dave. How do you gauge demand on Amazon.ca? Since reviews are so low I feel like it’s not the best metric. Do you use any Jungle Scout style tools like ASINspector?
Hi Danny,
The best way IMO is to divide the U.S.sales by 10 (or slightly lower like 8). You’re right – the reviews are really misleading.
Hi David,
Great info.
I’m just getting started in white labeling products. Do you think starting with Amazon.ca makes sense? I thought it might make sense since Amazon.com seems saturated.
Yes, if you’re Canadian.
I am curious, my company is planning selling our items on amazon.ca FBA. However what will become of the HST when we get a Canadian Business Number, I understand we will collect it from our sales, but we ship our item via Fedex so we will pay it when it come into the county. Will we get a refund for the second time paying the HST on the goods or just have to pay the HST effectively twice and only collect it once?
You mean the HST you pay for goods that you import into Canada? This is an input credit that you get back when you file your HST so you don’t pay HST twice.
Great article David. When shipping from your suppliers do you tend to send first to Canada or the USA and then split the shipment, sending a portion to the other country? Is there an advantage to shipping to Canada over the USA, or vice versa?
I tend to send to the U.S. first. Ideally if I can justify it, I’ll have a small LCL shipment shipped from China to Canada, although often I end up having to ship from the U.S. back up into Canada. The major downside to doing it the latter way is that you pay duties twice – in the u.s. and in Canada.
Hi David,
Thanks for a great article. I’ll be listing in Canada next month.
What about bilingual packaging? This seems like a legal requirement but seldom enforced?
Chris
I’m not 100% sure what the rules are around the Canadian bi-lingual packaging laws (and most of the visitors here aren’t Canadian so it’s irrelevant to them). I could be wrong, but I do not think this is something CBSA enforces at the time of import and other agencies enforce it when an item actually is for retail sale. Again, I could wrong though
Hi David, I’m Canadian and want to sell on both .com and .ca. Do I have to set up Seller Central acccount in both or can I set up a .com account only and use for both?
You can use one seller central account for Canada, the U.S., and mexico.
David,
Any advise for Merchant Fulfilled shipping? We don’t use FBA and would like to ship directly into Canada. Our items are low weight( under 1 lb) low $, (6-10) and small.
thank you. Ann
Do you mean shipping from the U.S. to customers in Canada? USPS is normally the cheapest.
Thanks David,
That is what I thought. I think I need to investigate. The whole tax situation by province and how I handle that. Plus whatever US customs needs me to include. Plus an import dues.
thank you.
Ann
Am I understanding it right: If i’ll send from China to Canada 1-2 boxes of 150 total units as a trial, I can avoid paying any taxes, correct?
Or should I still pay duties? If so: How do I get billed if shipment (Fedex, UPS) is made by China supplier?
Thanks.
I’m not sure where the $150 figure came from but Canada’s ‘de minimis’ threshold is $20 (meaning anything above this gets tax charged on ). Fedex/UPS will give you a bill upon delivery for the taxes/duties/brokerage.
Hi there great article! I have a question. On Amazon certain products like books can piggy back through a listing already made. Is that possible with Amazon CA?
Yes, you can piggy back on any existing listing on Amazon.ca as long as you’re selling that exact product.
David Such a uselful article. We are selling in Uk Europe since lat 7 years and in USA we setup FBA since last 4 years.
As a british citizien i formed a inc company in USA. We want to expand our business on Amazon.ca with FBA.
What do you suggest. Our volume is always high and we can easily go up to 100k in a year.
Please suggest
Short term you can ship in via Air Courier without really needing to do anything else. Long term you will need to setup a business number – a customs broker like pcb.ca can help with that.
Hey Dave,
Great article, thanks!
A couple questions:
1) Like many US sellers, we have drop shippers selling our products on Amazon.ca. The ASIN in the same, they are I guess using our same UPC etc. That means that I will need to take over their listings when going to Canada rather than creating new, correct? Have you ever heard of anyone having issues with this?
2) What is the status of Brand Registry in Canada? I would want it to lock off my listings from these drop shippers
3) This is a bit of an accounting question, but you touched on it so I will ask:) If I am a company registered in someplace overseas & I’m not American, do I need to pay profits tax to the CRA? I am getting conflicting feedback on this but if so it kind of kills all my eagerness.
Thanks a lot! Keep writing more great articles:)
1) You can try to take over the SKU, which will be messy, or just sell from the pre-existing sku. 2) I’m not sure actually. 3) I’m not a tax expert but I believe it will depend if the country you’re registered in has a tax treaty with Canada. If so (which most developed countries do) you would only need to pay sales tax.
Hi Dave,
Another great article as always.
Fellow Vancouverite here, I would really appreciate your input as I’m very stressed out:
I am a full-time gradute student just starting to import from China and selling on amazon via FBA.
As a trial, I just placed my first order on Alibaba for 120 bracelets worth of a total $98 being shipped by DHL/FedEx to Vancouver. I neither have a import/export account nor a registered business. Am I allowed to import as an indivisual with no business affiliations for resale? I am concerned this would be against the law.
Your answer is highly appreciated, thanks in advance.
You should probably be entering this as a commercial entry and have a business number. If it was me though I would do exactly as you’re doing and try to validate my product first and then worry about all the business stuff. You’re life is going to be a million times easier by spend the hour and a couple hundred bucks and getting a business number. Worst at worst, you won’t be able to clear the goods into Canada. I suspect the RCMP and CRA has better things to do than go after you $98 smuggling :)
David, this is very helpful and I didn’t have to go through a CPA who would charge at least $500 for tax issues in Canada. I thank you for your kind explanation for starting business in Canada via Amazon.ca.
You’re welcome – you can forward that $500 to Ecomcrew ;)
Hi David
i am selling my brand products since one year from amazon.com usa FBA. My sell volume reach $100 k per month.I am importing from China to my warehouse.i want to start sell through amazon.ca
do you advice me ?
Thanks
Sam jariwala
Easy – follow the steps here :)
Hi David
Thanks.I got BN number 15 digit as per your advice.Now should i apply GST/HST number and thenafter contact my freight forwarder to ship amazon warehouse in Canada? or i can apply GST/HST letter stage.I am confident to sell$100 k in one year to Canada
Thanks
Sam Jariwala
Business number and GST/HST number are more or less the same and I believe a business number is all you should need to clear into Canada. I’d contact pcb.ca and tell them what you’re trying to do. They can do your customs paperwork for you and also make sure you have everything you need.
Hi Dave,
Do you have the ideal number (in CAD$) you should purchase your products for from suppliers?
I know Amazon.com ideally your product cost should be around $5 per piece.
Thanks!
There’s no idea for .com or .ca. There’s lots of paddle board sellers making a ton of money on Amazon and their cost of goods is around $250 :)
David, thank you very much for all your efforts and support! We are planning to start doing business with Amazon.ca FBA.
Are the prices displayed on Amazon.ca including the taxes or are they net and the taxes are added once the customer has provided a delivery address?
The issue is how to calculate the price per item send to Amazon.
Thank you very much.
Sorry for the late reply. Tax is charged ON TOP of the purchase price.
Hi David Incredible Article very articulate and 1st I have seen that gives details from start to finish on amazon CA.
One question: I did UPS around 2 months ago from US to Canada via fba and the warehouse in Canada did not take the inventory UPS had to return it back to me.
How do I send it from my location in U.S. to amazon canada warehouse?
Yes, I had the same thing happen to me. You need to make sure the freight is going “DDP” aka all of the charges get billed to you and not Amazon.
HI David
Thanks for reply.One more question.My product has 18% custom duty in Canada and 5% gst to add.My other company sell to my NRI company at $10 per peace.Mean i have to pre pay duty $2.30 per peace in advance considering 22% total tax.Now when i sell through amazon.ca at $30 per peace,then after one year filling tax i have to pay tax 22% on $30 sell and credit for advance already paid at my cost of purchase at $10.This is correct.I have to pay income tax in Canada or only in USA .
Thanks
Sam Jariwala
Yes, paying the GST in advance sucks but you ultimately get it back. The duties are normally higher in Canada but this is because the U.S. is abnormally low not that Canada is abnormally high. Just price all of this in to your pricing in Canada and aim for the same margins you have in the U.S. – Canadians will pay for it :)
Hi Dave
Thanks for reply.As i want to add amazon.ca to my current amazon.com ,Amazon does lot of scrutiny and that my affect my current account.Some seller mention horror storey on seller forum about suspension of account.My account Health is very good.Is it easy to add amazon.ca
Thanks
Sam Jariwala
I’ve never heard of adding Amazon.ca adding more scrutiny to your .com. Maybe things have changed though.
Hi Dave, thanks for this great article it has helped us jump start our planning. For this one point we were wondering if there is anything that you would recommend us do to avoid the bad exchange rates at any given time:
To sell on Amazon.ca, you can continue to use your American bank account and Amazon will simply convert the funds into US Dollars, albeit with a terrible exchange rate (Amazon will take about a 3.5% commission). There’s no need to setup a Canadian bank account.
Would you recommend a bank account that transacts in CAD?
I would suggest looking into TransferWise’s crossborder bank accounts- you’ll get a much better rate when exchanging.
Thank you!
Hi Dave,
We are planning on starting international shipping for both our website and on Amazon after reading your article. Thanks for writing it, and for providing all of the helpful information. We think 10-20% growth is very achievable and appreciate you getting us motivated.
We would really appreciate it if you could help us with a couple questions.
Has FBA Export removed the need for shipping product into Canada for sale on Amazon.ca? If not, what are the pro’s and con’s of each method (FBA Export vs. Amazon.ca)?
Also, any recommendations for shipping to Europe? Australia? New Zealand?
Thanks so much for any help.
John
FBA export just ships from USA to Canada which can in no one compare to shipping from within Canada. They don’t get prime, pay a ton for shipping, have slow shipping times, and unpredictable duties and taxes. See our article on selling in the UK here: https://www.ecomcrew.com/how-non-europeans-can-sell-on-amazon-co-uk/
Hi Dave – was reading through your article as I am searching for more information about American’s sell on Amazon.ca (hard to come by so thanks for posting)
I am currently helping a US Corporate client move through getting tax and business accounts set up.
The one item I feel you may not be accurate on is that there are 5 sales taxes sellers may have to remit. HST/GST, BC Sales Tax, Saskatchewan Sales Tax, Quebec Sales Tax, and Manitoba Sales tax. So a warning – If you sell in those provinces you need to collect those sales taxes in addition the GST/HST. I believe Amazon.ca allows you to exclude selling in specific provinces (not absolutely certain).
Also just an FYI in response to some of the comments I read that may prove to be helpful for readers.
When an American individual or corporation applies for a CRA Business Number I would also note that at the same time they can apply for the GST/HST and Importer numbers – this is on the RC1-17e. Check boxes for each one.
American’s must collect HST/GST once their worldwide sales go over $30,000 (not just their Canadian Sales) and the threshold for Provinces that have sales tax is different or non-existent. So what this means for the vast majority of sellers is you should have your taxes accounts set up before you start selling on amazon.ca because you should be charging tax right away.
Apparently amazon.ca has told sellers from the US to just build the tax into their price until they get set up with tax accounts. Doesn’t seem the smart way to do things.
You will also be required to provide a security payment to Revenue Canada if you expect your Canadian Sales to be over $100,000. There is an exemption to this that can be signed off on.
It can take over a month to get all the provincial sales tax accounts set up. Each process is cumbersome, and different.
Thanks again for posting this blog, very helpful.
Thank you David for the excellent follow up. I will modify some of the information to reflect this. In regards to the different provincial sales taxes, I’ll clarify this regarding the provinces. I believe Saskatchewan has voluntary remittance for out of province sellers. BC and Quebec are the biggest provinces people should be aware of. Manitoba has a fairly negligible population and one has to weight the costs of selling there.
Good Day,
We are a amazon fba seller based in US. Based on my understanding, in order to sell on fba Canada, we need to register our business with Canada govertment, and register for import/export, then GST, and business income tax(unsure about this)
Do you have referal for any company for the follwing service?
1. help us to setup all IOR so we can import into amazon fba Canada warehouse(or if there is any way we can use third party IOR to import?
2. any sort of virtual mailbox service so we can receive legal letters from govertment
3. bookeeping and tax accountant, for us to pay/claim GST, and clarification on business income tax in Canada.
Thank you and have a great day!
David T
Hi,
Try david@smallbizpro.ca. For the mailbox, check out our list of third party logistics companies here: https://www.ecomcrew.com/the-ultimate-guide-to-finding-and-choosing-a-third-party-logistics-company-or-3pl/
Hi Dave, great article. I was wondering if I can get your thoughts on a couple of things:
I have an existing Amazon Seller Account in .com have been selling a few private products for about 4 years, doing okay.
My wife has a new Amazon Seller Account in .ca and would like to import and sell my .com products. Separate bank account and company name from the .com account. The Canadian Company is incorporated with Business Number and GST Number.
I have a couple of questions.
1. Do you foresee any problems with this?
2. Should we create a totally new listing? It will use the same labels and UPC code though.
Or should we just list the products from existing ASIN’s in .com
Thanks for your help.
1. You should probably technically get approval for this from Amazon. If you use the same IP to login they’ll probably flag and/or suspend one of your accounts pretty quick. 2. You’ll have to upload it as a new listing regardless (although 99% of the information will be the same like UPCs)
Hi Dave,
Thank you for your informative articles. I am a Canadian seller looking to launch my first product on Amazon.ca. Ideally, I’d like to get my first trial order shipped via air express (air courier) to avoid the hassle of finding a reputable freight forwarder and customs broker, plus avoid any hidden costs. I should say that the order will be shipped from my supplier directly to the FBA warehouse in Canada. As far as I know, all air express orders need to be shipped with DDP terms, is that correct? I just got a very expensive quote for air express from my supplier and I’m trying to make sense of it. Typically air express is about $7/kg but the quote she’s given me is a little over $12.5/kg. Can you provide any insight into why this would be so high? Is it because of the DDP terms?
I can provide additional information if you need it, but I would really appreciate your feedback and expertise because it can be a bit daunting and overwhelming trying to figure everything out myself.
Thank you so much and please keep up the good work!
Nicole
$7/kg is on the low end. $12.5/kg isn’t astronomically higher so it could be any number of factors, it’s a peak season, documentation and other fees are included. Suppliers generally don’t gauge on the shipping but they also do not shop around for the best rates so keep that in mind.
Hi Dave,
I am located in Canada and getting ready to place my first order from China which will be shipped directly to the FBA warehouse in Canada. I would like to get the first order shipped via air express so I don’t have to worry about finding a trustworthy freight forwarder right now. Is there a general rule of thumb for when it makes sense to ship air express instead of air freight or sea freight? The order weight is approx. 248kg (16 boxes) and my supplier has quoted me about $6.4/kg which seems pretty good to me. Can you provide any insights or thoughts on this? Also, am I correct in thinking that the shipping terms have to be DDP not FOB with air express to make sure there are no charges billed to Amazon upon delivery?
Your help and expertise is much appreciated.
Thank you,
Nicole
General rule of thumb is right around that 250kg mark sea freight starts to make more sense. You’re right at that limit so both rates are probably going to be pretty comparable. Yes $6.4/kg seems pretty good but sometimes the devils are in the details (i.e. surprise fees). I also assume that is to a local airport – keep in mind someone will still need to pick these goods up from the airport warehouse (it is NOT door to door delivery) and a customs broker will need to be used to clear customs for you.
Hi Dave,
Thanks for replying. Wouldn’t it be door-to-door delivery if it’s shipped via UPS Express Courier? Wouldn’t UPS handle the customs clearance for the order?
Thanks,
Nicole
Sorry I was just thinking it was air freight. If it’s going UPS it is normally quoted door to door and that rate is very good. And yes, they should handle the customs (but they’ll be charging you for it).
No problem, thanks Dave!
Dear Dave,
You are a wonderful resource!!
We are a small 501(c) 3 church-owned publishing company (Bibles, Prayer Books, Hymnals, etc). We import these from Asia printers. We understand about becoming an Non Resident Importer, the 5% Federal tax, and Provincial taxes. (We believe that books are exempt from Provincial taxes.)
If we use a fulfillment service in Canada to receive the imported books and sell them in e-commerce to our denomination’s Canadian churches and members, will we have to pay Canadian Income Tax on the money the fulfillment service remits to us in the US?
Can’t find the answer elsewhere, so your help will be much appreciated!
Thanks,
Ron
I
I can’t say for sure but normally if your country has a tax treaty with Canada it will make a lot of it null. I’ll give the obligatory- talk to a tax professional.
Great article, Dave, thank you for sharing. We are looking to expand to Amazon.ca (currently .com) but are trying to decide on FBA or FBM. Anything you can suggest to help us decide/what is best for tax purposes? Our product is made in the USA so we don’t have int’l suppliers to ship directly to CA, all products come directly from us. We use FedEx and will continue to. Is any of the info. in the article different than if we chose FBM (as it relates to paying GST/HST)?
If you do FBM from the U.S. to Canada you don’t have to worry about collecting GST/HST. If you fulfill from within Canada, whether or not you use FBA, you’ll still have to pay GST/HST on all orders so there’s not a significant difference.
HI Dave,
I am thinking of sending my goods directly to Canada to a 3PL warehouse and from there into Amazon. Do you have any recommendations for Canadian 3PL who are familiar with Amazon prep and processes?
Hi Charlotte – most 3PLs are familiar now with Amazon. Try http://www.integratedfulfillment.com though – they’re good people.
Hi Dave,
Great article and great podcast!
Do you have a general rule of thumb on how much to increase the US price of a product when listing it for sale on Amazon.ca?
In your podcast you mention the HST tax, duty fees to import into Canada, customs fees, currency conversion fees, the difference in currency exchange rates and the higher cost of shipping. Is there a ballpark percentage that can be used to add to the current US price to get close to what you should be charging in Canadian dollars?
Thank you.
Increasing them 50% is a safe bet. It’s going to vary though depending on the duty rate of the item and the currency exchange at that point in time.
Hi Dave,
Our company is currently selling on the .com site in the US and we are a US LLC. We are thinking of selling on the .ca site but have no idea how to approach this which is why we really appreciate this article and may even reach out to the Canadian accountant you listed. We don’t have a high volume of sales yet in the US so I’m a little skeptical about creating listing on the .ca site for all the other expenses that we will have to incur. I had a few questions about using .ca FBA:
1) Do most companies that do CA FBA use an accountant to handle all the GST/HST and provincial tax filings? Is that were David comes in?
2) Does getting a BN for our US company create nexus there where we have to file Canadian income tax returns?
3) How does this affect the partners of our US LLC…would that income flow down to them that would require them to file Canadian tax returns too?
Thanks for the help! Any advice would be appreciated!
Best,
Darrell
1. Yes most people would use an accountant at least for registration (remitting is very simple). Registration is simple though and can definitely be done on your own.
2. Not my expertise but normally tax treaties avoid you being double taxed.
3. Ha- Now you’re really over-estimating my taxation knowledge :-)
Hi Dave,
Is the dave at smallbizpro.com right email address? I of course changed the at to @ and took out the space. But the email was bounced back to me.
Thank you!
Thank you for the heads up !! It should be smallbizpro.ca (not .com). I’ll correct the article.
Hi Dave,
Thanks for the great article!
Maybe I’m not understanding this correctly but what if I’m buying from Amazon.com FBA and selling the same product to buyers on Amazon.ca,
1. I would need a brokerage company to bring the product over correct?
2. is the product still fulfilled by Amazon?
3. Would the product still be under warranty?
1. If you’re shipping to FBA in Canada, and not shipping it directly to the customers in Canada.
2. If you ship it to FBA in Canada.
3. Not sure – depends on the product’s warranty.
Hi Dave,
This week I received the Canadian Business number for my company along with the Import – Export account and a Corporation Income Tax Account which I didn’t request. I’ve been calling Canada Revenue and they insist that even though I have a U.S. coporation I need to have Corporation Income Tax account and the obligation to file an income tax return once a year, is this the case with you? I only requested a GST/HST and an Import-Export account when I requested my business number but they automatically enrolled me in the Corporation Income Tax as well which I think is not correct.
I’m not an accountant but I wouldn’t be surprise that you have to file a tax return, even if null. Again – filing and having tax due are two different things. I’m not sure which boat you fall into. You’d be best to talk to an accountant in Canada about this (there’s a link to a good one here).
Hello Dave,
I am a seller in amazon canada who is GST registered and I was wondering if I can set up pricing that can automate Gst/Hst/Pst for different province. My listing price is 20.99 and it gets taxed between 5% – 15% per sale for different province. Is there a way I can set up the pricing adding the specific GST/HST for the specific province? For example, listing price is 20.99, if a customer purchases my product from a province that taxes 15%, listed price changes for that province.
GST/HST is generally added after the sale (not within the sale price like Europe). This is pretty standard functionality in most shopping carts and Amazon. If you want a GST included price that differs, you’re really complicating your life.
Hi Dave,
excellent article!
I’m just trying to confirm one thing.
I’m a US seller and I would like to send a small shipment to Canada just for a test run. (about 100 items)
I will send via DDP (probably UPS or FedEx) but I don’t quite understand the Tax requirements.
As this is a test run. Do I need to register for Taxes in Canada or can I just send the first shipment, see how it goes and then go thru all the of that?
Thanks
Yes, you shouldn’t meet the sales tax threshold.
Hi Dave,
great article, thanks so much for the info. I am a US seller and finally going forward with Canada FBA. I tried to ship a pallet and it looks like I can’t do it without a Canada FBA phone number since the freight company actually needs to call and make a delivery appointment. I can’t seem to find this information anywhere and filing a ticket gets me no where. Any idea which number I need to provide to the Shipper to call?
Thanks so much,
Ed
You probably should find a different forwarder. Most forwarders/shippers now know the entire process of getting into FBA through and through.
Hi David, Great article, whish I had read it sooner! I live in the US and ship some products to Amazon.ca ( FBM and FBA ) Looks like the “easier” way is to just keep it at FBM as the customer will pay the taxes. However FMA in Canada sells much faster for me. Importing cases of products into Canada with UPS paying the fees does this relieve me of the GST and HST tax that the customer pays when I fulfill by FBM? Thank you for your help! Ron
If you’re sending individual shipments across the border to customers, then UPS should bill the customer for all applicable taxes. If you’re sending in cartons to Amazon for FBA, then no, no one is collecting tax for the customers.
Hi Dave
I want to start selling on amazon.ca. I may have a silly question, please bear with me :). But this is what i want to do. Order a small quantity, say about 20 units of a product from ali baba.com to get started . Get it shipped to an FBA warehouse in Vancouver (delta). Set up my listing and hope this product sells. Question 1) will ali baba ship directly from china to the warehouse here in vancouver? and if i choose DDP, will all the costs be included in that. Just regarding bringing the shipment over, what else should i be thinking about?
Don’t have it shipped directly from China to FBA. Your supplier most likely won’t actually ship it DDP and a bunch of other issues can occur (especially in Canada where our de minimis is so low) – ship it to yourself and then ship it in with partnered carrier.
Hi Dave, great article, wish I found this a couple years ago. I’ve been selling a few products on Amazon.ca (I am Canadian). I noticed only one of my items is Prime eligible – I have four products which are very similar variations, and all four are in stock at Canadian fulfillment centers. Prices range from $26 – $35. It’s the $35 one that has the Prime eligible sticker on the listing. Any idea why this would be?? Thanks very much!
Check what address you have entered in Amazon. Could be Canadian location dependent.
Hi David, this is a really helpful article. Question for you. You wrote: “Furthermore, on July 1, 2021 things got even simpler as Canada rolled out marketplace tax collection (MTC) rules which mean Amazon will collect and remit GST/HST for any seller who is NOT registered for GST/HST.”
This sounds great, because I don’t think I’d have the bandwidth to do sales tax filings and remittance myself.
What confused me is that, later in the article, you wrote that the 5th step in getting started is to “Register for GST/HST”. Don’t I want to *avoid* registering for GST/HST, because NOT being registered for GST/HST is what will allow me to have Amazon file and pay sales tax to the Canadian government on my behalf? Thanks for any clarification.
If you meet the legal threshold for having to register to collect GST/HST you still have to do it. Canada knows many sellers won’t, so they put the burden on Amazon to collect if the seller doesn’t. There’s also often tax advantages to registering for GST/HST (i.e. you get back most GST/HST paid during the year)
Hi Dave,
Thank you very much, it is indeed very informative and encouraging. Three questions:
1) With regards to the MCT rule, do I need to apply with Amazon in any way for Amazon to collect the tax on my behalf? Or I just list the product, and Amazon will deduct the FBA fees + taxes + etc automatically every time I sell a unit?
2) Also, for my product, there is really no instructions or anything really.. It’s just a wooden box, wrapped in bubble wrap and packed in a kraft box, and the supplier in China helped me print the FNSKU and shipping labels.. I think that’s about it. So do I still need to do the French labelling thing?
3) If I send10 cartons which has 4 units each (total 40 units), by sea shipping, do you reckon I can get away without a Canadian business number just yet?
Thanks a lot Dave.
1. Too complex for me to answer here.
2. Legally, probably. There’s certain elements that are required to be bilingual. See the link in the article.
3. Value will be more contingent the the number. As long as you can get someone (i.e. the 3PL) to pay the duties on arrival for you and forward you the invoice, you should be OK.
Hi Dave, thanks so much for the rich content and article. Very helpful!
My team has some more questions on the topic of bi-lingual product regulations.
Context: we are a large US personal care brand (soap, shampoos, etc.) selling mostly DTC & Amzn US. We’ve launched our Canadian DTC business ~14 months ago and doing well. Our products only have English packaging at this time.
Questions:
1) We understand there is a risk of product takedowns in the case of ample customer complaints. However, do you know the process of how this would work? Specifically, how many customer complaints would it take? Would we likely get fair warnings before Amzn forced delisting? Would we have the chance to pause all of .CA to not risk the US listings/business?
2) Are there known precedents for this occurring? (i.e., examples of this in the past you’ve seen)
3) Is there a way to suppress sales and/or ad spend in Quebec province to mitigate this risk further? Basically we disallow sales to Quebec at checkout or some other mechanism?
Thanks so much for the help!
I’ve never heard of products getting suspended for bi-lingual issues. You’re right that hypothetically a bunch of customer complaints could trigger it, but this doesn’t seem to be a ‘thing’ that customers complain about often (I’ve personally never seen such a complaint). There’s no way to exclude certain regions for sale on Amazon unfortunately.
Hello Dave
Thank you for the great article which helped me to process FBA Shipments for Canada.
Couple of questions that I like to ask to make sure.
1- Do I need to make Commercial Invoice for FBA Shipment to Canada? If so, is there a certain format that I need to follow?
2- Since I can’t use the Amazon Partnered Labels other than UPS Labels, when I write down the receiver’s address, is it okay for me to list my contact number since I can’t find the Amazon Warehouse number?
Hope to receive the answer from you soon and have a great one.
1. Any format is really fine. Just find any invoice template and it should be fine as long as it shows the item totals and overall total.
2. Yes
Thanks for the info, Dave, great stuff. I don’t really understand the role of customs brokers and you don’t mention them.
I applied for BN + NRI (RM) for US LLC with CRA. I won’t touch GST/HST registration until there’s annual $30K in Canada.
1. I’m confused about the next steps. Do I just register an account with US UPS and ship DDP through them (US 3PL to Canada FBA)? And pay the duty through my CBSA account and send proof to UPS?
2. I talking to a shipping company/agent that says after NRI registration is done I need to apply for a Canadian Brokerage Account ($250). At the same time, they mention that UPS will act as a customer clearance broker (I don’t understand what that means and if that is different from a customs broker). I am lost, so what exactly do I need this shipping agent for, when the UPS will be the broker. Is the broker just paying the CBSA and submitting commercial invoice on my behalf? Do I need some kind of a broker other than UPS for this kind of situation (US 3PL to Canada FBA via UPS)?
3. Since Amazon is collecting and remitting GST/HST on our behalf now, do I even need to deal with GST/HST registration after $30K is crossed? I mean I probably want to do that when there’s a revenue of a couple of $100K, but what if it’s like $50-200K.
Thank you and have a great day