In Canada, any goods imported into the country are subject to a duty fee or tariff. This fee is set by the Department of Finance and it is collected by the Canadian Boarder Services Agency (CBSA). The amount charged depends on many things such as, what you paid for the item, shipping fees, insurance, where it was made as well as many complex international trade agreements that Canada has entered into with other countries. This often misunderstood fee is one of those hidden charges that can catch a Canadian online shopper off-guard when they see the added shipping expenses. Since it is so complex, you will need some help calculating the amount to pay.
There is some good news. If the item that you are importing (buying online) was made in Canada, the United States of America or Mexico, then the North American Free trade agreement (NAFTA) exempts the item from any duty. You will still have to pay the federal and provincial taxes but no duty. Many American online merchants have duty calculators built into their shopping carts so you can see exactly what you will pay along with shipping and taxes. If they don't calculate duty for you, then you should. It's not that difficult. There are many different calculators available for free or even a slight charge.
The Canadian Boarder Services Agency provides a tax and duty calculator located at http://www.cbsa-asfc.gc.ca/travel-voyage/dte-acl/est-cal-eng.html. It is free to use and it even estimates the federal and provincial taxes for you.
Our favourite duty calculator is http://www.dutycalculator.com/new-import-duty-and-tax-calculation/.They have data on over 380,000 different products. This is the same site that we use to power our own Canbuy.ca Canadian Duty Calculator. It allows you to do up to ten free duty calculations per month. If you need more, they offer a paid service too. Click here to view our Canadian Import Duty calculator.
Another great site is http://www.thefinalcost.com/. This Canadian duty estimator is totally free with no maximum and it is very simple to use. One great feature of this site is that if you know the method that your purchase will be shipped, they also estimate brokerage fees! Very nice indeed. http://www.borderbuddy.com/usRegularItem.html is another duty estimator but they require you to enter your email address and they send your quote to you by email.
No matter which duty calculator that you chose, don't forget that Canadian duty fees are only one part of the overall shipping expense. You should also be considering the shipping costs themselves, insurance, entry preparation (brokerage) fees, bonds and any hidden handling fees.