CARM Release Prior to Payment: What Canadian Importers Need to Know

Since May 2024, every Canadian importer has dealt with CARM — the CBSA Assessment and Revenue Management system — whether they wanted to or not. One feature that confuses our clients more than almost any other is carm release prior to payment, often called RPP. If you’re bringing commercial goods into Canada and your broker mentions RPP or financial security deposits, this is what’s actually happening behind the scenes.

What Release Prior to Payment Actually Means

Release prior to payment is not new. Before CARM, brokers could post security with CBSA and release your shipment before duties and taxes were paid, giving you 30 days to settle the account. What changed in May 2024 is where that security lives and who manages it.

Under the old Revenue Management system, brokers held their own bonding arrangements with CBSA. Now, under CARM, financial security must be posted through the CARM Client Portal by the importer of record or by the broker on your behalf. The mechanic is the same — goods clear, payment follows — but the administration shifted entirely.

When your broker submits a CAD (Commercial Accounting Declaration, formerly the CAD Canada Customs Coding Form under CARM) and selects RPP as the payment method, CBSA checks that sufficient security exists in the portal before releasing the shipment. If the security is there, your freight moves. If not, the release is held until payment clears or security is posted.

Who Needs Financial Security and How Much

CBSA requires financial security equal to your estimated duties and taxes over a rolling payment cycle, typically 30 days. For most mid-market importers, that means calculating your average monthly duty bill and posting that amount.

If you import $200,000 in goods per month and your blended duty and GST rate is around 15%, you’re looking at roughly $30,000 in monthly obligations. CBSA will typically ask for security in that range, sometimes with a buffer. The exact figure depends on your import history, compliance record, and whether you’re using a broker’s security or posting your own.

Security can take three forms: a cash deposit held in the CARM portal, a bond or surety issued by an approved financial institution, or in limited cases a guarantee. Cash ties up working capital. Bonds cost an annual premium, usually 1–3% of the bond value depending on your creditworthiness. We see most established importers opt for bonds once their import volumes justify it.

Using Your Broker’s Security vs. Posting Your Own

You have two paths: use your customs broker’s financial security, or post your own.

Most of our clients at CanFlow rely on our bonding capacity, especially in the first year of importing or when volumes are unpredictable. We maintain substantial security with CBSA specifically so our clients don’t need to tie up their own capital or navigate the bonding process. You pay for the service as part of your brokerage fee structure, and we manage the compliance and reconciliation.

Posting your own security makes sense if you’re a high-volume importer, you want direct control, or you’re working with multiple brokers. The trade-off is administrative burden. You’ll need a Business Account Number, a CARM Client Portal account with the right delegation roles, and someone internal who understands how to monitor your security balance and reconcile statements when CBSA debits your account.

Either way, the security must cover your exposure. If you run out of security mid-month because of a spike in imports, releases stop until you top up. We’ve seen that happen more than once in the first six months of CARM, particularly with clients who underestimated their seasonal peaks.

How RPP Affects Cash Flow and Payment Deadlines

The headline benefit of release prior to payment is timing. Your shipment clears the border immediately — no waiting for funds to transfer, no holds while accounting cuts a cheque. For perishable goods, time-sensitive inventory, or just-in-time manufacturing, that speed matters.

The trade-off is you now have a 30-day payment obligation. CBSA debits your security account or invoices your broker, and you settle up on the payment cycle. Miss a payment or underpay, and CBSA will freeze future RPP privileges until the account is current. We’ve seen penalties and interest compound quickly — section 33.4 of the Customs Act allows CBSA to charge interest on overdue amounts, currently pegged to prescribed rates that change quarterly.

If you’re used to paying duties on a transactional basis — one shipment, one payment — RPP requires tighter cash flow forecasting. You need to know what’s clearing this week and what the bill will look like in 30 days. Our clients who sync their CARM portal access with their accounting software have the easiest time. Those who rely on monthly broker statements sometimes get surprised.

Common Problems and How to Avoid Them

The biggest issue we see is security shortfalls. An importer posts $25,000 in security, imports $200,000 worth of goods in a busy month, and suddenly releases stop because the duties exceeded the available balance. CBSA does not front the money — if your security is exhausted, you’re back to paying per transaction until you replenish it.

Second is delegation errors in the CARM Client Portal. If you want your broker to manage RPP on your behalf, you need to delegate the right authorities in the portal. Missing or incorrect delegations mean your broker can’t post security, can’t see your balance, and can’t release your goods. We spend a lot of time walking new clients through portal setup because CBSA’s interface is not intuitive.

Third is reconciliation lag. CBSA’s monthly statements in CARM sometimes take weeks to finalize, and if there’s a dispute over classification or valuation, the debit might not match what you expected. Keeping your own records — every CAD, every commercial invoice, every duty calculation — is the only way to catch discrepancies before they become compliance problems. Our compliance services team helps clients audit these records, but the importer of record is ultimately responsible.

Deciding If RPP Makes Sense for Your Operation

Release prior to payment isn’t mandatory. You can still pay duties transactionally if that suits your business better. Smaller importers with infrequent shipments, tight margins, or unpredictable volumes often prefer to pay as they go. No security deposit, no monthly reconciliation, no risk of a shortfall.

RPP makes sense when speed and predictability outweigh the administrative cost. If you’re clearing multiple shipments per week, managing a complex supply chain, or importing goods where a 24-hour delay costs real money, the investment in security and process pays off. Most of our mid-market clients end up using RPP once their import cadence stabilizes.

If you’re still figuring out your duty exposure or need help estimating what security you’ll need, our brokerage team can pull your import history and model it out. We do this every month for clients transitioning into CARM or scaling up their cross-border operations.

Next Steps

If you’re importing into Canada and you’re not sure whether your current setup uses release prior to payment, or if you’re paying more than you should in security or bonding costs, we can walk through it with you. CARM is still new enough that most importers haven’t optimized their process yet.

Get in touch with our team and we’ll review your situation — no obligation, no sales pitch, just a practical conversation about what makes sense for your operation.