With all of the COVID-19 talk on the news and elsewhere, it’s easy to overlook the fact that Canada recently ratified the new updated North American Free Trade Agreement (NAFTA). It was the last of the three countries (Mexico, Canada, USA) to do so and it paves the way for implementation in all three countries. And among other things, it will affect online shopping for mountain bikers.
We all win when we can easily get our bike parts, beer, and even the odd souvenir across the border as quickly and easily as possible.
There is a large and ever-growing amount of goods crossing the border through online shopping. On top of that, riders from both the US and Canada criss-cross the border in search of great riding. Knowing the basics of what you can bring across the border duty/tax-free, both in person and online, can save you money and headaches. We all win when we can easily get our bike parts, beer, and even the odd souvenir across the border as quickly and easily as possible.
How much can I order ONLINE before I have to pay taxes and/or duty?
One of the biggest changes to take place since the signing of the original 25-year-old NAFTA is the proliferation of online shopping. As such, there have been some changes to the value of goods purchased through online shopping that mountain bikers can order and have shipped across the Canada/US border.
The amount Canadians can order from the USA duty/tax-free has increased. This is important because the selection of parts, accessories, and even bikes available online is much larger south of the border. In many cases, the prices are also lower.
For US residents ordering online from Canada, the duty/tax-free amounts remain the same. But the amount the United States allows was, and remains, significantly larger than Canada’s.
How much can Canadian residents order online from the United States duty/tax-free?
- $40 worth of goods duty AND tax-free (up from $20 in the original NAFTA agreement)
- $150 worth of goods duty-free (up from $20 in the original NAFTA agreement)
The tax-free limit refers to the amount that is not subject to federal or provincial sales tax. Above $40 and below $150, sales taxes may be charged, but not duty. Above $150 both duty and taxes are charged.
How much can United States residents order online from Canada duty/tax-free?
- $800 worth of goods duty-free (no different from original NAFTA agreement)
The US federal government does not have a sales tax, so there is no limit on what can be shipped across the border tax-free. However, state and local taxes may be charged depending on where in the country you live.
It’s also worth noting that although the duty-free amount allowed by the US is much higher than Canada’s, Canadians are more likely to order from the US than vice versa. According to the Retail Council of Canada, 67% of Canadians report having made online cross-border purchases while only 22% of Americans report the same.
How much alcohol and other goods can I bring back when I cross the border?
In addition to online shopping, many riders physically cross the Canada-USA border in search of great mountain biking. In short, the value of goods a person can bring with them across the border hasn’t changed in the updated NAFTA agreement. But it is worth reviewing.
Maybe you’re an American crossing the border to visit the mountain biking mecca of British Columbia. Or maybe you’re a Canadian looking to escape winter and ride somewhere warm.
Either way, souvenirs are an important part of any mountain bike trip. And with the explosion of craft breweries in North America and the proximity of many mountain bike towns to wine-producing regions on both sides of the border, there’s a good chance you’ll want to bring some alcohol home with you as a souvenir. Not all mountain bikers drink of course, but it is undeniable that beer has become ingrained in the culture.
How much alcohol can I bring from the United States back to Canada duty-free?
- If in the United States for less than 48 hours: no exemption
- If in the United States for more than 48 hours: 1.5 litres of wine, or 1.14 litres of alcohol, or 8.5 litres of beer
The amounts of different alcohols listed above cannot be added together. For example, you can’t bring back 1.5 litres of wine and 8.5 litres of beer—only one or the other.
How much alcohol can I bring from Canada to the United States duty-free?
- 1 litre of alcohol of any kind
The amount of alcohol you can bring from Canada back to the United States is smaller than the amount that can cross the border in the opposite direction. But there are a few other differences to note as well.
There is no minimum time period that you have to spend in Canada in order to bring back alcohol duty/tax-free. Also, it is likely you can bring back more than one litre. You would just have to pay taxes and/or duties on the additional amount. And finally, it would seem that US border agents are able to use their discretion when it comes to how much alcohol they allow into the country. As such, depending on the circumstances, they may allow more than one litre to cross the border duty/tax-free.
What is the value of goods I can bring from the United States back to Canada duty-free?
- If in the United States for less than 24 hours: no exemption amount
- If in the United States for 24 – 48 hours: up to $200
- If in the United States for more than 48 hours: up to $800
Time periods cannot be combined to allow for larger exemption limits when bringing goods back to Canada. Also, if you are in the United States between 24 and 48 hours, and bring back more than $200 worth of goods, duties will have to be paid on the full amount, including the first $200. And exemption amounts are calculated in Canadian dollars, so the price of any items must be converted from US dollars before being reported.
What is the value of goods I can bring from Canada back to the United States duty-free?
- If visiting Canada for less than 48 hours: $200
- If visiting Canada for more than 48 hours: $800
In addition to the raw numbers, there are two clarifications you should be aware of. First, using the 48 hour/ $800 limit is only allowed once every 30 days. And second, members of the same household can combine duty-free limits; you just need to be traveling together.
Save yourself a headache and some money!
Cross border online shopping by mountain bikers between the United States and Canada is big business. And while trade between the two countries is relatively free, there are rules. Nobody likes border hang-ups, or ordering something online only to find the price has been inflated by duties and taxes. Luckily, being familiar with the guidelines above can save shoppers border headaches and money. So, whichever side of the border you live on or visit, don’t be afraid to buy those bikes parts and beer!
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