As a Non-Resident Importer, your company does not pay corporate income tax in Canada unless it has what’s called a permanent establishment (such as a staffed office, company-run warehouse, or Canadian employees under your direct control). 
When operating through a third-party logistics partner, most brands do not meet that threshold. 

However, all brands selling goods into Canada will handle Goods and Services Tax (GST) or Harmonized Sales Tax (HST) — a value-added, flow-through tax collected on behalf of the government. 

• GST is a 5% federal value-added tax on most goods and services sold in Canada. 

• HST combines GST with provincial sales tax in certain provinces (e.g., Ontario, Nova Scotia, Newfoundland & Labrador, New Brunswick, Prince Edward Island). 

• Non-resident sellers must register for a GST/HST account if they sell directly to Canadian consumers or store inventory in Canada for sale. 

• Once registered, you charge GST/HST on sales and remit it to the Canada Revenue Agency (CRA). 

Business Number (BN): Your BN doubles as your GST/HST registration. When you apply for a BN, simply indicate that you’ll be collecting GST/HST; the CRA will assign a suffix (e.g., RT0001) that becomes your GST/HST account number. 

GST/HST is not a cost to your business — it’s a pass-through mechanism designed so that only the final consumer bears the tax burden. 

Here’s how it works in practice: 

1. At import: You pay GST on the declared value of the goods when they enter Canada. 

1. At sale: You collect GST/HST from your Canadian customer, calculated on the higher sale price. 

1. At filing: You remit the difference between the tax you collected and the tax you paid — meaning you recover all GST you’ve already paid at import. 

This ensures GST/HST has no net impact on your margins or landed cost. It’s fundamentally different from duties or tariffs, which are true costs and cannot be recovered. 

Additionally, you can claim Input Tax Credits (ITCs) to recover GST/HST paid on legitimate Canadian business expenses — for example: 

• GST on hotel stays, meals, and transport during Canadian business trips. 

• GST/HST on Canadian professional services (legal, marketing, accounting, etc.). 

• GST paid on inbound freight, samples, or display materials. 

At the end of each filing period, the CRA calculates the total GST/HST collected minus the total paid (including import GST and business expenses). 

• If you collected more than you paid, you remit the balance. 

• If you paid more than you collected, you receive a refund. 

For detailed reference: CRA – GST/HST for Non-Residents 

Canada maintains a broad network of bilateral tax treaties to prevent double taxation and clarify cross-border tax obligations. 
The most commonly applied agreements for NRI-model brands include: 

• 🇺🇸 United States – Canada Income Tax Convention (1980) 
  Ensures U.S. companies are not taxed in Canada unless they maintain a permanent establishment. Dividends, royalties, and interest benefit from reduced withholding rates. 

• 🇬🇧 United Kingdom – Canada Tax Treaty (1978) 
  Protects UK businesses from double taxation and clarifies income sourcing. 

• 🇦🇺 Australia – Canada Tax Treaty (1980) 
  Limits Canadian tax exposure to income earned through a Canadian establishment. 

• 🇳🇿 New Zealand – Canada Tax Treaty (2012 update) 
  Provides relief on cross-border royalties, dividends, and business profits. 

• 🇫🇷 France – Canada Tax Treaty (1975, amended 2013) 
  Clarifies tax treatment of business income and capital gains for French entities. 

• 🇩🇪 Germany – Canada Tax Treaty (2001) 
  Follows the OECD model to prevent double taxation and define “permanent establishment.” 

• 🇩🇰, 🇸🇪, 🇳🇴 Nordic Treaties (1983–2002) 
  Offer equivalent protections and consistent tax definitions for Scandinavian businesses. 

Full list available via the Department of Finance Canada: 
Canada’s Tax Treaties – Department of Finance 

Under Canada’s treaties, a company is only tax-resident in Canada if it maintains a fixed place of business or dependent agent here. 
Most brands using a 3PL like NRI do not qualify as having a permanent establishment. 
Therefore: 

• No Canadian corporate income tax applies. 

• Only GST/HST returns are typically required. 

• All other tax obligations remain with your home-country entity. 

• The Non-Resident Importer model enables full Canadian participation without a Canadian entity. 

• GST/HST is a flow-through tax, not a business expense. 

• Tax treaties prevent double taxation and protect non-resident sellers. 

• Maintain clear records of import GST, Input Tax Credits, and sales tax collected to ensure smooth compliance and refunds.