Why that package you ordered to Canada costs so much – Saving Yourself Money on Shipping/Brokerage
If you LIKE paying more than you should for things, stop reading now. If you think brokerage fees are a terribly blatant overcharge, carry on.
For those of you who receive packages from the US particularly: did you know you can save a lot of money on your shipments relatively easily?
Major shipping companies like UPS, FedEx Purolator, etc all routinely charge Brokerage fees to clear your shipments through Canada customs. These fees (for me personally) have ranged anywhere from $10-$50 or more on things like small hand tools, metals, clothing, food or or craft supplies, depending on the total value of what’s shipped, and what’s inside the box.
I feel like brokerage fees are a rip off; especially since I now know what’s involved in clearing a package through customs myself. After all, I’m already paying $20-50 in shipping charges for these folks to get me my package; am I really to believe that the 2-3 minutes of work for a shipping company employee is worth THAT much money??
What Brokerage Gets You
Essentially, the shippers are charging you a premium for getting your paperwork stamped. Yup. That’s it. And for collecting the duties and taxes on behalf of our lovely federal government. This is something you can quickly and easily do; I’ll even tell you how.
How To Clear Your Own Shipment – in YYC – in 6 Easy Steps
If you live in Calgary Alberta, as I do, here’s what you do:
1. If the shipment arrives at your door, ask the driver to detail the fees. (You’ll likely be paying duty, taxes including GST and a Brokerage Fee. Get that info BEFORE you sign for and accept the package. If you can’t get it from the driver, refuse the shipment, and call the shipper’s head office with your tracking number to get details.)
2. Decline the shipment by telling the driver you wish to clear the shipment through customs yourself. You can also do this by calling your shipper of choice if you’ve received a delivery notice (as I did), or even before the package arrives to your door.
3. The shipper will be required to give you a copy of the waybill or itemized packing slip, and this should include the country of origin itemization for each item. In some cases the shipper will ask you to come and pick it up (if they want to make life difficult for you). In my case, they offered to email it to me. This did me the kindness of saving me a trip. Another time I tried to self-clear, I had to ask for this information specifically, and for it to be e-mailled to me. fax is also an option the shippers seem to prefer.
4. Take the waybill/invoice to Canada Customs/Border Services Agency (**UPDATE: they’ve MOVED from 2588 27 St NE to a NEW location MUCH CLOSER to the shippers up by the Calgary Airport New Address (and it’s a new street some online maps won’t know yet) 22 Aero Dr NE). Take a number. I have yet to see a lineup in this office first thing in the morning when I usually go. The CBSA agent will input your stuff into their computer, calculate your taxes and duty and hand you a bill, that you take to the adjacent cashier and pay.
While in 95% of cases, I’ve saved a LOT of money self-clearing (saving anywhere from 15-, there was one occasion I came out basically even. My shipper told me my bill was :Taxes: $33.00, Duty: $1.56 and Brokerage: $24.60. CBSA told me my bill was Taxes: $34.02, Duty $20.21, and of course zero brokerage fees. So my total bill from the shipper was about $59. From CBSA: $54. I’ll get to why that is in a sec, but first the rest of the steps for my friends in a hurry.
On another package pick-up attempt, I was asked by CBSA to provide “Proof of Payment” on a dress. The agent politely but firmly said the shippers often “make up generic packing slips” and “lie about the value so duty is avoided. They think they’re doing the customers a favour”. She was insistent I provide either a copy of my credit card bill, bank statement, or a receipt. Since I had none of those (as they’d be INSIDE the box I was hoping to get cleared) I had to improvise. A quick phone call to the company I purchased the dress from and they were able to e-mail me a receipt that showed the value. Though it wasn’t technically a receipt, the CBSA agent was able to use it and verify what was on the “generic packing slip”. My total: $39 in tax and duty, and total avoidance of the additional FORTY DOLLAR brokerage fee UPS was going to tack on!
5. Take your paid bill (the CBSA agent will stamp it again as proof you’ve paid and they know it; Ahhh, yes, red tape and paperwork in triplicate!) and drive to your shipper’s headquarters near the Calgary Airport in the NE. This is now a 2 minute drive from the CBSA office. Go inside, present your shipping notification or tracking number, along with the completed/approved/stamped paperwork.
6. Getcher package, and drive all the way back across the city home.
And there’s always a but…
So WHY on that one occasion did I end up paying pretty much the same bill in the end by doing all the work? Well,1) it could be a CBSA mistake; getting them to re-calculate the duty “just to double check” did NOT go over well. And let’s be honest, they don’t have to justify anything, and won’t. Arguing with a federal agent is truly a waste of time and really just buys you a cavity search. 2) The CBSA agent could have been a little overzealous in applying the duty, or really just sticking to the EXACT letter of the law. 3) My shipper could also have miscalculated and undercharged me on *their* bill. Or 4) perhaps there is some kind of arrangement with the shippers and the federal government that the shippers can legally charge Brokerage Fees, in exchange for slightly lower duties? I have no knowledge of why, and not really a lot of desire to begin navigating several levels of government to find out over that particular $4 difference.
On another occasion, there was another odd wrinkle in my plans; when I went to pick up the package, UPS told me it had been “re-addressed”. The package had been forwarded to another random person in another random city in Alberta ( by “someone”, they don’t know or wouldn’t say who). I don’t know if this was a genuine mistake, or a cute joke to delay me further, or (if I were the suspicious, malicious type) if someone was giving me payback for cheating a giant multinational out of their brokerage fees and talking about it on Twitter. But I digress.
So out of the one dozen times I’ve now done this, I come out waaay ahead in 95% of the cases, like I said. If you want to be sure, you could try calling CBSA to get an accurate assessment of the duties BEFORE opting for self clearing, just to be sure it’s worth it.