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3. Importation of goods

On importing goods into Canada exclusively for consumption, use, or supply in its commercial activity, a registered importer can claim an input tax credit (ITC) to recover the GST payable on import. The ITC claim arises on the GST becoming payable by the importer or being paid by the importer without having become payable pursuant to ss. 169(1) of the ETA. The GST imposed on import under Division III of the ETA shall be paid and collected under the Customs Act (the CA) “as if the tax were a customs duty levied on the goods under the Customs Tariff” pursuant to s. 214 of the ETA.

Generally, under ss. 32(1) of the CA, the imported goods cannot be released from Canadian customs control until the importer accounts for the goods and pays the “duties” (including the GST). Where ss. 32(1) of the CA applies, the ITC eligibility would arise on payment of the GST to the Canada Border Services Agency (CBSA) prior to release of the goods.

Under ss. 32(2), ss. 32(3) and s. 33 of the CA and subject to meeting the security requirements under paragraph 9(a) and s. 11 of the Accounting for Imported Goods and Payment of Duties Regulations (the Regulations) and s. 35 of the CA, the importer may obtain c (RPP) Privileges that allow accounting and payment of duties after release as prescribed by these Regulations. While there may be an interim accounting required prior to release (under paragraph 32(2)(a) of the CA and paragraph 9(b) of the Regulations), the final accounting may be deferred up to five business days after the release of the imported goods (under s. 10 of the Regulations).

The payment of duties (including the GST) on imported commercial goods released in a Harmonized Monthly Billing Period (the HMB Period) from the 18th day of a month until the 17th day of the following month, would be due by the 10th weekday (the Due Date) after that HMB Period (under section 10.1 of the Regulations). For example, in the case of imported commercial goods released on September 22, 2025 in the HMB Period from September 18 – October 17, 2025, the payment of the GST on this importation would be due on October 31, 2025. In this example, the importer does the final accounting to the CBSA on September 26, 2025 within five business days after release.

Assume that:

  1. in scenario (a) the importer pays the GST to the CBSA (Receiver General of Canada) on October 28, 2025 before the Due Date of October 31, 2025; and
  2. in scenario (b) the importer pays the GST to the Receiver General on the Due Date of October 31, 2025 or later.

Questions

  1. Would the ITC claim arise under ss. 169(1) of the ETA:
    1. in scenario (a), on the payment of the GST on October 28, 2025 (before becoming payable on the Due Date of October 31, 2025); and
    2. in scenario (b), on October 31, 2025 (the Due Date on which the GST becomes payable), irrespective of whether the GST is paid on this Due Date or later? In other words, is the Due Date when the GST becomes payable by the importer? I.e., when is the importer is considered to have become liable under the CA for the duties (including the GST) on the imported goods (as referred to in ss. 17(3) of the CA)?
  2. Or would the ITC claim arise on accounting for the imported commercial goods on September 22, 2025 within five business days of release because the GST liability of the importer is finalized and crystallized by the importer at that time (after the imported goods have been charged with the GST, as “duties” under the CA, “from the time of importation thereof until such time as the duties are paid or the charge is otherwise removed” pursuant to ss. 17(1) of the CA)?

    As of September 22, 2025, the evidence of the GST accounted for on the Customs Accounting Declaration (the CAD) should be sufficient information to enable the amount of the ITC to be determined to satisfy the condition for claiming the ITC in paragraph 169(4)(a) of the ETA.

CRA Comments

Subsection 169(1) provides that a registrant may claim an ITC for the GST/HST paid or payable on property and services to the extent that they are acquired by the registrant for consumption, use or supply in the course of its commercial activities. When the tax is considered to become payable is dependent on when the liability for the tax is incurred.

As pointed out in the question, section 214 of the Excise Tax Act states that GST/HST under Division III in respect of imported goods shall be paid and collected under the Customs Act as if the tax were a customs duty levied on the goods under the Customs Tariff. As a consequence of this section, it is the provisions of the Customs Act that establish liability for the Division III tax.

A number of provisions within the Customs Act operate to establish when imported goods are subject to duties and who is liable for those duties. Subsection 17(1) of the Customs Act states that imported goods are charged with duties from the time of importation, which by the interaction of subsections 12(1) and 18(1) generally occurs when the goods are reported. Subsection 18(2) then establishes joint and several liability on any person who reports the goods under section 12, and on any person acting as that person’s agent or employee while reporting, unless one of a number of exceptions apply.

As a result of these provisions under the Customs Act, the liability for duties and, consequently the GST/HST, arises in respect of imported goods when those goods are reported to the CBSA. Once the liability has arisen, the GST/HST is payable, regardless of the date that payment is due.

Because an ITC may be claimed in respect of GST/HST that is payable if the requirements of section 169 of the Excise Tax Act are met, such as having sufficient documentary evidence to support the ITC, a registrant’s eligibility to claim an ITC should not be affected by use of programs such as the CBSA’s Release Prior to Payment Program.

Based on the interaction of the relevant Customs Act and Excise Tax Act provisions, the answer to both presented scenarios would therefore be that an ITC in respect of the GST on the imported goods could be claimed on the day those goods were considered to be imported. Assuming the goods were

reported and released on the same day, which in the scenarios is September 22, 2025, then this would be the date when an ITC could be claimed in respect of the Division III GST, assuming that all other criteria for claiming the ITC have been satisfied.