End Use Requirements, Taxes (PST & GST), and Duty

Overview

The Customs and Traffic Division will examine and interpret Federal (e.g. Customs Act) and Provincial Legislation with respect to all University imports. It is the responsibility of the purchaser to fully cooperate and assist the Customs and Traffic Division in providing specific information that may be required in order to accurately determine the end use, tax and duty status for certain goods.


End Use Information Requirements:

Certain goods may be exempt of taxes and/or duties depending on their end use. It is the responsibility of the purchaser to provide the specific end use of the goods on the Purchase Requisition Form. This information is vital for the correct application of tax and duty exemption certificates. The tax status of each item is determined by Purchasing Resources, and official exemption certificates are completed by the Purchasing Officers.

If the end use is not shown on the Purchase Requisition, delays may occur while the use is being determined, or taxes and/or duties may be applied incorrectly.


Duty Information:

Certain goods imported into Canada are assessed customs duties or tariff by the Government of Canada at the time of import.

It is imperative that the purchaser include a full description of the item on the Purchase Requisition such as the name of the apparatus or instrument. If parts are being ordered, please include the name of the apparatus or instrument that the parts will be installed.

National Customs Rulings (NCR) may be requested by Customs and Traffic for specific items to determine the applicable rate of duty. However, rulings should be obtained prior to importation, and rulings may take up to 90 days to receive from Customs authorities. If a purchaser would like to obtain a NCR, they must provide an accurate description of the item (including supplier’s specifications), as well as a detailed description of its end use.


Taxes:

Provincial Sales Tax (PST)

Provincial Sales Tax is and 8% tax imposed by the Provincial Government at the retail price level and is in addition to all other taxes.

Most items purchased by the University are subject to Provincial Sales Tax. However, there is a PST exemption on the purchase and repair of some equipment that is designed for and used exclusively in research, and will not be diverted to any other use for a period of 3 years. Also, PST is not applicable on some items including books, subscriptions, and memberships. Questions regarding the taxable nature of a particular item should be directed to the respective Purchasing Officer. PST is voluntarily assessed by Accounts Payable at the time of import based on the supplier’s invoice.

Goods and Services Tax (GST)

The Goods and Services Tax is a 5% tax imposed by the Federal Government that is applicable to all goods and services produced, manufactured, or imported into Canada.

Most University departments qualify for a 67% rebate of the 5% GST. Questions regarding the taxable nature of a particular item should be directed to the respective Purchasing Officer. The Importer of Record (owner or purchaser of goods; legally responsible for payment of duty, taxes, fees, fines or penalties issued by Customs or other government departments) is responsible for remitting any applicable GST to the government. GST will be assessed upon import into Canada by the respective importing agent (i.e. University’s customs broker, Canada Post). Any questions regarding GST with respect to imports should be directed to the Customs and Traffic Division.