Calculating Duties and Taxes

Identify the Harmonized System (HS) code associated with your product

The Harmonized Product Description and Coding System (HS) is used to describe products for customs purposes. This coding system ensures that customs officials all around the world are referring to the same item when classifying a product and applying a tariff rate. The HS assigns six-digit codes that represent general categories of goods. All countries adhering to the HS use the same six-digit code for each product. However, a country can assign its own additional four numbers, making the entire code 10 digits.

You can find the HS code for your product online using FedEx Global Trade Manager®, the Statistics Canada website or the United States International Trade Commission website (for US imports). Remember the first 6 digits of the HS code is recognized by all countries under the WCO (World Customs Organization).

Calculating Duties and Taxes


Most countries use the CIF (Cost, Insurance and Freight) method to calculate duty charges. CIF is a pricing term that means the cost of the goods, insurance and freight (shipping charge) are included in the quoted price. The total duty and tax charge is calculated by adding all costs together. (For more information about VAT, see the Value-Added Tax section.)

Some examples of calculating duties and taxes:

To the U.S.

Value of Goods* US$2290
Duty Rate (7%)
Merchandise Processing fee
Advancement fee
US$160.30
US$25.00
US$5.21
Total Landed Price US$190.51
Convert to Canadian dollars if Canadian Payer @ 0.995* CAD$189.56

 

Inbound to Canada

Value of Goods* CAD$2290*
Duty Rate (7%)
Duty Charge
Duty Paid Value
GST (5%)
CAD$160.30
CAD$2450.30
CAD$122.52
Total Duty and Tax
Advancement fee
CAD$282.82
CAD$8.30
Total Landed Price CAD$291.12

 

To Europe

Value of Goods* US$932
Insurance Charge
Freight Charge
US$16
US$52
Total CIF Value
Duty Rate (7%)
Duty Charge
Total Duty and Tax
US$1,000
x.07
US$70
US$1,070
VAT (18%)
VAT Charge
x.18
US$192.60
Total Landed Price US$1,262.60
Convert to Canadian dollars if Canadian Payer @ 0.995* CAD$1256.29

 

*Conversion rates may fluctuate.


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