Travelling to the USA?

September 19, 2014 Published by
Post Categories: Advice For YouTax Accounting

Do you know what your tax exemption spending limit is?On a recent trip to Niagara Falls, New York, my friends and I were stopped at the Rainbow Bridge border for overspending. Little did we know that our spending limits were so low, and that we would have to pay taxes and duties on what we brought back to Canada to the Canadian Border Security Agency (CBSA). It really put a damper on the trip and made the whole trip seem a lot less worthwhile from a savings perspective.

If you’re planning to do some cross-border shopping over a long weekend, some information from CBSA that might help you plan your trip and might make your trip a little more worthwhile than mine.

Effective September 2014, there are spending limits and personal exemptions.

Time Spent

Personal Exemption Limits

Alcohol Limits

Tobacco Limits


< 24 hrs

 $  –



24 – 48 hrs

 $ 200.00



If > $200, full amount is subject to duties/taxes

48hrs – < 7 days

$ 800.00

8.5L of beer; 1.5L Wine; or 1.14 L of liquor

200 cigarettes, 50 cigars, 200g of manufactured tobacco and 200 tobacco sticks

Goods must be in possession at time of entry into Canada

7 days +

 $ 800.00

8.5L of beer; 1.5L Wine; or 1.14 L of liquor

200 cigarettes, 50 cigars, 200g of manufactured tobacco and 200 tobacco sticks

Other than alcohol or tobacco, goods could also follow entry into Canada (mail, courier, etc) or be in possession at time of entry. $800 exemption total still applies and declaration amount includes amounts of the items that follow


Duties and taxes

It’s also important to note how this is calculated I made the mistake of thinking I could just add up the subtotals of my receipts. In fact, it is more complicated so here are a few things to take note of:

  • declare the final amounts in Canadian dollars, which  includes foreign sales taxes paid on those same purchases;
  • the total amount not covered by the personal exemption will be subject to both GST/HST and or any duty that applying;
  • duties vary depending on what you are importing, type of items being imported and what country the goods were made.

What should I declare or prepare for when returning from the US:

  • prepare all receipts of items purchased to facilitate any inspection upon arrival at the border
  • declare if you are bringing into Canada extra baggage, on you, or in your vehicle; cash or monetary instruments that exceeds $10,000 Canadian
  • declare all firearms and weapons as non-declaration could lead to prosecution and goods being seized
  • declare all explosives, fireworks and ammunition as some items might require actual written authorization and permits
  • declare food, plants, animals and related products as some items might carry diseases or cause for spread of insects

What happens if I make a false declaration?

  • CBSA can seize the goods
  • You could face penalties of 25-80% in order to get the goods back
  • CBSA could seize the vehicle you have driven to the border as it could be considered to have been used to import goods unlawfully
  • Permanent seizure of non-declaration of alcohol or tobacco items
  • Infraction record being kept in the CBSA computer system which might result in more detailed scrutiny when crossing the border in future instances

Overall tips:

Where it is feasible, try to stay more than 48 hours on your trip to gain maximum personal exemptions on the amount you spend. Also, by doing this, subsequent trips of 48 hours or more will provide for special duty rates under the “Most-Favoured Nation” tariff treatment. This will allow for just a 7% tax rate on the first $300 and $800 above the spending limits for 48 hour and 7-day trips respectively. Finally, always declare in full all items you are bringing into Canada as the penalties and possible infractions could certainly make your trip less enjoyable.