Starting an Import/Export Business in Canada: Complete Guide for Newcomers

Canada's position as a trading nation makes import/export one of the most promising business opportunities for newcomers. With access to trade agreements covering countries representing over 60% of global GDP — including the United States-Mexico-Canada Agreement (CUSMA/USMCA), the Comprehensive Economic and Trade Agreement (CETA) with the European Union, and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) — Canada offers unparalleled access to international markets. For newcomers who have existing business connections in their home countries, an import/export business can leverage those relationships into a profitable Canadian enterprise.

This guide walks you through every step of starting an import/export business in Canada, from business registration and obtaining the necessary permits to understanding customs duties, trade regulations, and financing options. Whether you plan to import consumer goods, food products, textiles, or technology, or export Canadian products to international markets, this comprehensive guide provides the specific information you need.

Step 1: Register Your Business and Obtain Required Accounts

Before you can import or export goods, you need several registrations:

Business Registration

Register your business as a sole proprietorship, partnership, or corporation with your provincial registry. For an import/export business handling significant volumes, incorporation is strongly recommended for liability protection. See our guide on federal vs. provincial incorporation for details.

CRA Business Number and Import/Export Account

Register with the Canada Revenue Agency for a Business Number (BN) and specifically open an import/export program account. This is essential for clearing goods through customs. Register at the CRA business registration portal. Your import/export account number will be your BN followed by "RM0001."

GST/HST Registration

If your annual revenue exceeds $30,000 (or you expect it to), register for GST/HST. You will need to pay GST on imported goods at the time of entry, and you can claim these amounts as input tax credits.

See also: GST/HST Credit Guide for Newcomers

Step 2: Understand Canada's Customs Requirements

The Canada Border Services Agency (CBSA) administers Canada's customs laws and collects duties and taxes on imported goods. Key concepts include:

Harmonized System (HS) Classification

Every product that crosses an international border is classified using the Harmonized System — an international coding system. The HS code determines the duty rate, whether any permits are required, and which regulations apply. You can look up HS codes using the CBSA Customs Tariff.

See also: How to Get Your SIN Number in Canada

Customs Duties

Duty rates vary widely depending on the product and its country of origin. Some examples:

• Clothing and textiles: 0%–18% depending on the specific item and origin
• Electronics: Often 0% under various trade agreements
• Food products: Highly variable, 0%–300%+ (dairy, poultry, and eggs are subject to supply management tariffs)
• Furniture: 0%–9.5%

Canada's trade agreements can significantly reduce or eliminate duties. For example, goods from the EU may enter duty-free under CETA, and goods from CPTPP countries (including Japan, Australia, Vietnam, and others) benefit from preferential rates.

Anti-Dumping and Countervailing Duties

Some products are subject to additional duties if they are found to be "dumped" (sold below fair market value) or subsidized by a foreign government. The Canadian International Trade Tribunal (CITT) determines these duties. Check the CBSA website for current anti-dumping measures before importing.

Step 3: Obtain Required Permits and Licences

Many products require specific permits or licences to import into or export from Canada:

• Food products — Regulated by the Canadian Food Inspection Agency (CFIA). You need a Safe Food for Canadians (SFC) licence to import food. Annual licence fee is approximately $250–$10,000+ depending on your business size.
• Health products — Regulated by Health Canada. Importing pharmaceuticals, medical devices, natural health products, or cosmetics requires specific licences and compliance with Canadian regulations.
• Controlled goods — Products like firearms, cultural property, hazardous materials, and certain technologies require export permits from Global Affairs Canada.
• Textiles and apparel — Require proper labelling under the Textile Labelling Act (fibre content, care instructions, dealer identity — all in English and French).
• Consumer products — Must comply with the Canada Consumer Product Safety Act. Products must meet Canadian safety standards and labelling requirements.

Step 4: Choose a Customs Broker or Self-Clear

When goods arrive at the Canadian border, they must be "cleared" through customs. You have two options:

• Hire a customs broker — A licensed customs broker handles all paperwork, classification, duty calculations, and CBSA interactions on your behalf. This is strongly recommended for newcomers. Broker fees typically range from $50–$150 per shipment for standard entries, plus any applicable duties and taxes. For complex shipments, fees may be higher.
• Self-clear — You can clear goods yourself, but this requires a thorough understanding of customs procedures, HS classification, and CBSA requirements. Mistakes can result in penalties, seizures, and delays.

Step 5: Plan Your Logistics

Shipping Methods

• Ocean freight — Most cost-effective for large volumes. Transit times from Asia: 15–30 days. From Europe: 10–20 days. A full container load (FCL) 20-foot container costs approximately $2,000–$5,000+ depending on the route.
• Air freight — Faster (1–5 days) but significantly more expensive. Best for high-value, low-weight, or time-sensitive goods. Costs $4–$8+ per kilogram.
• Courier services — UPS, FedEx, DHL for smaller shipments. These companies handle customs clearance for shipments, which is convenient but more expensive per unit.

Incoterms

International Commercial Terms (Incoterms) define the responsibilities of buyers and sellers in international trade. The most common are:

• FOB (Free on Board) — Seller delivers goods onto the ship. Buyer is responsible for freight and insurance from that point.
• CIF (Cost, Insurance, and Freight) — Seller pays for freight and insurance to the destination port. Buyer handles customs clearance and inland transport.
• DDP (Delivered Duty Paid) — Seller handles everything, including customs clearance and duties, delivering goods to the buyer's door.

Step 6: Understand Your Financial Obligations

• Duties and taxes at importation — You must pay applicable customs duties plus GST (5%) on the value of goods at the time of importation. Some provinces also collect provincial taxes at the border.
• Value for duty — The customs value is typically the transaction value (the price you paid for the goods), plus certain adjustments such as freight costs to Canada and royalties.
• Payment methods — Duties and taxes can be paid at the time of release, or you can apply for a Release Prior to Payment (RPP) privilege from CBSA, which allows you to defer payment.
• Record keeping — CBSA requires you to keep import records for six years. This includes purchase orders, invoices, bills of lading, customs documentation, and proof of payment.

Exporting from Canada

If you plan to export Canadian products, the process includes:

1. Research your target market — Understand the regulations, tariffs, and consumer preferences in your destination country.
2. File export declarations — Goods valued over $2,000 require a Canadian Export Declaration (CED) filed through the Canadian Automated Export Declaration (CAED) system.
3. Obtain certificates of origin — To benefit from trade agreement preferential tariff rates, you need proof that goods qualify as Canadian-origin products.
4. Leverage government export support — The Trade Commissioner Service (TCS) provides free advice, market intelligence, and connections in over 160 countries. Access at tradecommissioner.gc.ca.
5. Consider Export Development Canada (EDC) — EDC offers export credit insurance, financing, and bonding to help Canadian exporters manage risk and access international markets.

Financing Your Import/Export Business

• BDC loans — The Business Development Bank of Canada offers working capital loans and lines of credit for import/export businesses.
• EDC Working Capital Guarantee — EDC can guarantee a portion of your bank line of credit, making it easier to obtain financing from your bank.
• Letters of credit — Banks issue letters of credit to guarantee payment to foreign suppliers, which is essential for building trust with new international partners.
• CanExport program — Provides up to $50,000 in funding to help small businesses explore new export markets.

Starting an import/export business in Canada requires careful planning and attention to regulations, but the opportunities are substantial. With Canada's extensive network of trade agreements and government support programs, newcomers with international business connections are well-positioned to succeed. Explore our guide to grants and funding programs for additional financing options, and use WelcomeAide Chat for personalized guidance on your import/export business plan.