Avoid Brokerage Fees (UPS et al)
EDIT: Moderator move to general, didn't mean to put this here.
There are a lot of posts on beyond.ca about UPS. Duty, GST and specifically brokerage fees seem to be the largest area of complaint.
Unfortunately, the opinion that brokerage fees are a 'scam' or 'ripoff' are largely formulated on ignorance of the process. They are very lucrative for the companies doing the brokerage work, that I would conceed. But they are not a 'racket'. Duty and GST are unavoidable, however, I will point out a way to 'cheat' on duty a little bit, if you wish to try. (See end of post)
DUTY AND GST (OUCH!)
"Other" shipping companies are still required to charge the same things for Duty and GST. Duty charges vary depending on the type of item you are importing. These are fixed percentages based on the amount and classification of the item. Please note that your government has established the rates applicable - not some shipping company. Duty and GST are not charges the shipping company is making up - they are actually charges from Canada Customs. The shipping companies merely collect this from you because they incurred these charges when they cleared the packages for you.
BROKERAGE FEES TOO... (UGH!)
The only variance in what you will pay to import your goods will be brokerage fees. But likely you will still pay brokerage fees of some level while it may vary from shipping company to shipping company. You may also find it increases based on the quantity and value of goods imported.
So, for all those people who don't understand how to NEVER PAY BROKERAGE FEES AGAIN, this post is special for you. Read on...
POWER OF ATTOURNEY
First, shipments to businesses are different than shipments to individuals. When you ship via UPS, UPS has a little thing called Power of Attourney over personal shipments. This gives them the ability to automatically clear your package through customs. They fill and file the paperwork, and charge you a brokerage fee.
For businesses, Power of Attourney is not automatically given to UPS. So, UPS will contact the business asking who the broker for the company is. Large businesses will likely have a brokerage company do the work. OR the business can fill out a form which will give Power of Attourney to UPS for purpose of clearing the package(s) through customs as another option.
THIS IS WHERE IT GETS IMPORTANT
Whether your shipment is a personal thing, or a business thing, you have the option of "Self Clearing". What this means is that you are going to have to do the filling and filing of the paperwork yourself. In the case of a personal shipment, you MUST notify UPS as soon as you have the tracking number that you intend to self clear. In the case of a business, they will contact you - at which point you indicate you are going to self clear.
SELF CLEARING - THE BASICS
Once you have indicated that you are going to self clear...when your package 'arrives' at your shippers warehouse, they will prepare the necessary forms for self-clearing. You must then go to your shippers warehouse, and pick up these forms. You won't even require a pen! The forms are filled out already with the necessary information from the computer. So, off you go...
Once you have the clearing forms, you must then proceed to Canada Customs. (It's just off 32nd Avenue, N.E. - you turn left just before Staples, then right, then right in to the parking lot). This is handy, because pretty much all the shipping companies have warehouses just minutes away from this location.
Keep in mind you must be the person who the shipment is to, or you must be an individual with Power of Attourney over the Company if it is a business shipment.
Once you are inside, you will find a computer - and a book. The book contains all the line codes you may require to understand in order for you to fill out the forms correctly. Kind of like doing your taxes! (Same idea). When you have entered all the information, which will usually include ports of exit and port of entry, method of shipment, costs of goods, classification of goods, importer name, shipping costs, etc. The computer will then print out the finalized forms which will indicate how much you must pay in Duty and GST for your imported goods.
They have agents there who will then have a quick once over of your information, and then you will proceed to pay what you owe at the cash desk.
Once you have paid what you owe, your papers will be stamped "cleared". You return to your shipper with these papers, and they will retrieve your packages. You have just brokered your own packages, and have avoided brokerage fees completely.
SOUNDS LIKE TOO MUCH WORK
Then pay the damn brokerage fee and don't bitch!
AS PROMISED, CHEATING THE SYSTEM
All goods imported in to Canada have different DUTY rates applied to them depending on the type of good. Even within the automotive realm, duty rates are not all the same. For example, importing a flywheel, may have a higher duty rate than say, 'automative transmission components' - now, you're just a silly chump filling out the forms, so if you know which areas require less duty, you can 'work' the system slightly to allow a lower rate of duty to be applied to your imported goods. You're only going to save a few percentage points. But it can be done. Uhm, and if for some reason what you are doing gets questioned, you'd be likeBut more often than not, you're not going to be questioned unless you are completely re-classifying the goods.
Cheating the duty by a couple percentage points isn't the point of this thread. Completely removing brokerage fees is the point!
Hope some people find this helpful. If brokerage fees annoy you, this the way to avoid them. If you think it's easy, power to you. If you think, my god, why would I do that? Pay your brokerage fees but at least understand the process so you know what it is you are paying for...
Enjoy
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