Tax representation in Canada, better known as NRI (Non Resident Importer), refers to a company established in a third country that wants to import goods to Canada.
What is NRI?
NRI refers to the status of a business established outside Canada that sells goods to customers in Canada, ensuring that all customs obligations are respected. NRI status allows a company to be competitive on the Canadian market without opening offices locally and without making investments.
The status of NRI takes into consideration a number of factors:
- Canadian customs (customs obligations including HS Tariff Classification and tariff treatment that apply to imported goods)
- The business number
- Maintenance of records
- GST (Goods and Services Tax), the Canadian equivalent of VAT, on imported goods
Before importing to Canada, a company must obtain a Business Number and register with the GST with the Canada Revenue Agency (CRA) if its annual revenue exceeds CA$ 30,000. All non-established businesses importing goods into Canada have to pay the GST, even if they are not registered.
Importer of record
The importing company can appoint an Importer of Record (IOR) responsible for all accounting duties relating to import: taxes owed to the Canadian state, keeping of all required documents. The IOR is responsible for the obligations related to the company’s import activities.
Advantages of tax representation / NRI
NRI, by limiting the number of intermediaries and eliminating the need for a facility in Canada, allows a company to reduce costs and delivery times while centralizing procedures and obligations.