CARM and Low-Value Imports: When Canada's De Minimis Thresholds Require Full CAD Filing

Key Takeaways

• Canada’s de minimis thresholds (CAD $20 duty, CAD $40 tax) apply only to personal imports; commercial shipments under CARM require a CAD regardless of value if you are the registered importer.
• CARM Phase 2 Release 3 eliminated the informal workaround for low-value commercial parcels by tying clearance to Client Portal registration and RPP bond posting.
• Courier brokers file CADs on your behalf for most parcels, but you are responsible for HS classification accuracy and CARM account setup before the first shipment arrives.
• Misclassifying commercial goods as personal to dodge CAD filing triggers AMPS penalties; CBSA verifies import purpose at entry and can reassess years later.

EU Ends Low-Value Parcel Exemption; Canada’s CARM Takes a Different Path

The European Union imposed a €3 customs duty on all e-commerce parcels starting July 1, 2025, eliminating the long-standing exemption for shipments valued up to €150. Air cargo carriers and cross-border sellers are adjusting to fragmented enforcement across member states, and the shift has triggered clearance delays and compliance confusion across European ports.

Canada has not followed the EU playbook. We still have de minimis thresholds: CAD $20 for duty, CAD $40 for taxes, per CBSA policy. But CARM Phase 2 Release 3, which went live in May 2024, changed the rules for commercial low-value imports. If you are a registered importer with a CARM Client Portal account, you cannot treat courier parcels as informal clearances just because the invoice is under CAD $100. Every commercial entry now requires a Commercial Accounting Declaration filed through CARM, tied to your Business Number (BN15) and your Release Prior to Payment bond.

The practical effect is similar to the EU’s intent: eliminate the grey zone where cross-border e-commerce sellers dodge formal clearance by keeping invoice values low. But instead of a flat per-parcel tax, Canada tied the gate to CARM registration and CAD filing. If you are doing business, you are in the system.

Canada’s De Minimis Thresholds Still Exist, But Only for Personal Imports

The CAD $20 duty threshold and CAD $40 tax threshold apply to non-commercial (personal) imports. A gift from a relative in the U.S., a personal-use item bought online for your own consumption, a one-time purchase with no resale intent: these can clear informally if the declared value is under the threshold.

Commercial imports do not qualify. CBSA defines a commercial import as anything imported for sale, lease, rental, business use, or as part of a commercial transaction. If you are a business entity importing goods, even a single parcel per month, CBSA expects a CAD and a CARM account. Courier brokers (UPS, FedEx, DHL, Purolator) will file the CAD on your behalf if you have given them your BN15 and CARM authorization, but the import is still tied to your Client Portal account and your RPP bond.

The shift happened because CARM replaced paper B3 forms with digital CAD submissions, and every CAD is linked to an importer’s CARM profile. There is no informal workaround for registered importers. If CBSA sees repeated low-value shipments to a business address, they will treat it as commercial activity and require full compliance setup, including HS classification, origin determination, and duty accounting.

When You Need a CAD vs Informal Clearance

Here is the decision tree:

• Personal import, value under CAD $20: No duty, no CAD. Informal clearance.
• Personal import, value CAD $20 to CAD $40: Duty applies, no GST/HST. Still informal if CBSA accepts the personal-use declaration.
• Personal import, value over CAD $40: Duty and taxes apply. Informal clearance if personal-use intent is clear, but CBSA may require proof.
• Commercial import, any value: CAD required, tied to your CARM account and RPP bond, regardless of invoice amount.

The key word is commercial. If you are importing to resell on Amazon, stock your retail location, fulfill Shopify orders, or supply your manufacturing line, it is commercial. CBSA does not care if the parcel is worth CAD $15 or CAD $1,500. The nature of the transaction determines the clearance path, not the invoice value.

Most Canadian importers handle this through courier-arranged brokerage. The courier files the CAD, pays duty and taxes on your behalf under your RPP bond, and invoices you afterward. But you are still the importer of record. You are responsible for HS 6-digit classification accuracy, CUSMA or CETA origin claims if applicable, and responding to CBSA verification requests. If the courier misclassifies the goods or you provided incomplete product details, CBSA will reassess and you will owe the difference plus interest.

CARM Registration and RPP Bonds for Low-Value Parcel Importers

If you are new to importing and your first commercial shipment is a CAD $80 sample order from Alibaba, you still need a CARM Client Portal account and an RPP bond before CBSA will release the goods. Setting this up takes time:

1. Register your Business Number (BN15) with CRA if you do not already have one.
2. Create a CARM Client Portal account at CBSA’s CARM portal.
3. Post an RPP bond with a surety or through a customs broker. Minimum bond amounts vary, but most brokers set a floor of CAD $5,000 to CAD $25,000 depending on your projected monthly duty and tax liability.
4. Authorize your courier or broker to file CADs on your behalf, linking their portal access to your BN15.

Once the setup is complete, every parcel clears under your account. CBSA tracks your duty and tax payments on the K84 monthly statement, which reconciles what you owe against your bond. If you consistently under-report or if your monthly liability exceeds your bond coverage, CBSA will ask for a higher bond or hold future shipments until you post additional financial security.

For importers bringing in small-value parcels weekly or monthly, this administrative load is a sharp increase from the old informal clearance days. But CBSA’s position is clear: if you are in business, you are a commercial importer, and CARM applies.

Comparison to the EU Parcel Tax and What It Means for Cross-Border Sellers

The EU’s €3 flat duty is simpler in concept but harder to enforce uniformly. Member states are implementing the measure at different speeds, and carriers report inconsistent clearance procedures across borders. The intent is the same as CARM’s: close the loophole where low-value parcels bypass formal customs processes.

Canada’s approach is more procedurally demanding but arguably more coherent. Instead of a symbolic per-parcel fee, CBSA requires full CAD filing, proper HS classification, and accurate origin and valuation documentation. The cost to the importer is not a flat tax; it is the brokerage fee (typically CAD $15 to CAD $50 per entry for courier-arranged clearance) plus the duty and taxes that would have applied anyway if the shipment were over the de minimis threshold.

For cross-border e-commerce sellers shipping into Canada, the takeaway is straightforward: you cannot dodge formal clearance by keeping shipments under CAD $100. If you are the importer of record, you need a CARM account, and every parcel will generate a CAD. If your customer is the importer (common for DDP Incoterms or Amazon FBA shipments), they need the CARM setup. Either way, someone is filing a CAD, and CBSA expects proper classification and origin documentation.

Misclassification Risk and AMPS Penalties

Trying to game the system by declaring commercial shipments as personal or undervaluing goods to stay under de minimis thresholds is not a viable strategy. CBSA runs automated risk scoring on all entries, and repeated low-value parcels to the same consignee trigger manual review. If CBSA determines you misrepresented import purpose or value to avoid CAD filing, you face Administrative Monetary Penalty System (AMPS) contraventions.

A Level 1 AMPS penalty for misrepresentation starts at CAD $1,000 for a first offence and scales up for repeat violations, per the CBSA AMPS penalty schedule. CBSA can also reassess the original entry within four years under Section 59 of the Customs Act, collecting the unpaid duty and taxes plus interest. The administrative cost and reputational risk of an AMPS file is far higher than the cost of doing it right from the start.

If your import volumes are growing and you are handling clearance in-house or through a courier, periodic compliance audits are worth the investment. Catching HS classification errors or missing origin claims before CBSA does keeps you out of the AMPS queue.

What Canadian Importers Should Do Now

If you are importing commercial goods, even small-value samples or inventory top-ups, and you do not yet have a CARM account, set it up before your next shipment. Courier brokers can arrange the RPP bond and file CADs on your behalf, but the account and BN15 must exist first.

If you are already registered and using courier brokerage, review your HS classifications and origin claims. CARM’s digital audit trail makes it easier for CBSA to spot patterns, and misclassification on low-value entries is just as risky as on high-value shipments. The duty difference might be small per parcel, but the AMPS exposure is the same.

For importers with warehouse consolidation needs or complex inbound freight routing, working with a licensed broker and a bonded facility can streamline CARM compliance and reduce per-entry costs. FENGYE LOGISTICS operates a CBSA sufferance warehouse in Montreal, handling release prior to payment and dock-to-stock under CARM for clients who need visibility and control over parcel and LTL inbound.

We file CADs daily for clients importing everything from FBA inventory to industrial components. Most of these entries are under CAD $500 in value, but every one goes through the same CARM clearance process as a full container. CBSA does not have a shortcut lane for low-value commercial parcels. If you are a registered importer, you are in the CAD filing system, and the only way out is to stop importing.

If your current clearance process feels opaque or you are not confident in your HS classifications, that is a fixable problem. Get in touch and we will walk through your shipment profile, classify a sample entry, and show you what a clean CARM setup looks like.

Frequently Asked Questions

What is Canada’s de minimis threshold for customs duty in 2026?

Canada’s duty de minimis is CAD $20 and tax de minimis is CAD $40 for personal imports. Commercial shipments do not qualify for de minimis treatment under CARM and require a Commercial Accounting Declaration filed through the CARM Client Portal, per CBSA’s Phase 2 Release 3 implementation in May 2024.

Do I need a CAD for every commercial parcel under CAD $100?

Yes, if you are the importer of record with a CARM Client Portal account. Courier brokers file the CAD on your behalf, but CBSA ties every commercial entry to your BN15 and RPP bond. Informal clearance is only available for non-commercial (personal) shipments below the thresholds.

Can I avoid CARM registration by keeping shipment values below CAD $40?

No. CARM registration and CAD filing apply to all commercial imports regardless of value. CBSA treats repeated low-value parcels to a business address as commercial activity. If you are selling, reselling, or using goods in a business, you need a CARM account and an RPP bond before the first clearance.

What happens if CBSA reclassifies my parcel from personal to commercial?

CBSA can reassess within four years under Section 59 of the Customs Act. Reclassification triggers duty and tax owing plus interest. If CBSA determines you misrepresented import purpose to avoid CAD filing, AMPS penalties start at CAD $1,000 for a Level 1 contravention and scale up for repeat offences.

How does the EU parcel tax compare to Canada’s CARM low-value rules?

The EU eliminated its €150 exemption and now charges €3 duty on all e-commerce parcels. Canada still has de minimis thresholds for personal imports, but CARM ended the informal loophole for commercial shipments. Both regimes now require formal clearance for business imports, but Canada’s CAD system is tied to Client Portal registration rather than a flat per-parcel fee.

Who files the CAD when I order samples from a Chinese supplier?

Your courier (UPS, FedEx, DHL, Purolator) files the CAD as your agent if you gave them your CARM BN15 and authorization. You are still the importer of record and responsible for HS classification, CUSMA or CETA origin claims, and duty payment. If the courier does not have your CARM details, the shipment will be held until you provide them or arrange brokerage separately.

Can I use informal clearance if I import one parcel per month worth CAD $50?

Only if the import is genuinely personal (a gift, personal-use item with no resale intent). If CBSA sees monthly shipments to your business address, they will treat it as commercial and require CARM registration. Frequency and destination matter more than value when CBSA decides import classification.

What is the RPP bond minimum for CARM low-value imports?

CBSA requires an RPP bond for release prior to payment under CARM. The minimum bond amount varies by importer and duty/tax exposure, but most brokers post CAD $5,000 to CAD $25,000 as a floor. Your monthly duty and tax liability, tracked on the K84 statement, determines whether CBSA will ask for a higher bond.

Source: The Loadstar