Published August 27, 2024 • 7 Min Read
For Canadians who live within an easy drive of the United States, it’s hard to resist the allure of crossing the border to shop. The U.S. can offer Canadians lower prices, the availability of certain products, and lower sales taxes. If you’re planning a trip to the U.S. to shop, here are a few tips to make the most of your excursion.
Plan ahead for your U.S. shopping trip
Before you leave home, check the wait times at the border crossings nearest to you on the Canada Border Services Agency website. If you’ve got some flexibility on your route, have your passenger keep tabs on the way down on the CPB Border Wait Time app and be prepared to change your point of entry on the fly.
Try to avoid peak travel times, especially around statutory holidays – such as late Friday before a long weekend or late Monday on the way home. If you have to travel on a long weekend, the best time may be either early (before 7 a.m.) or late (after 8 p.m.).
Consider getting a Nexus card
The most stressful thing about crossing the border may be, well, crossing the border. But imagine if there was a way to skip that long lineup of cars and get to your destination sooner?
There is one — apply for a NEXUS card. A joint program of Canada Border Services and U.S. Customs and Border Protection, a NEXUS card allows low-risk, pre-approved travellers expedited access across the border. But note: every person travelling with you must have NEXUS to use the designated lanes.
You will have to fill out an online application and meet with a border services officer to get fingerprinted and have a retina scan before being approved – and the process can take a couple of months from start to finish. But at $50 for a five-year card, the savings in time and stress at the border can be more than worth it.
As a bonus, your NEXUS card will also let you use a special (meaning shorter) line at airport security checkpoints at most major Canadian and U.S. airports, no matter where you are flying.
Know your personal allowances
Before you plan your trip across the border, make sure you know the dollar value of goods you can bring home.
There is no personal exemption for day trips — you’ll have to be in the U.S. for at least 24 hours to be able to claim a $200 Canadian tax-free and duty-free allowance that can’t include any tobacco or alcohol. After 48 hours, you can claim purchases worth up to $800 Canadian, including specified amounts of alcohol and tobacco.
It’s a good idea to always declare your purchases, even if you think they don’t qualify for an exemption. At worst, you might have to pay some sales tax and duty, but those costs can pale in comparison to the penalties you may pay if agents find goods you haven’t declared. Not to mention the extra time that might come with getting stopped and questioned about your purchases.
Understand what’s duty-free
Even if you’ve exceeded your personal allowance, you might not have to pay duty on some cross-border purchases.
Thanks to the North American Free Trade Agreement (NAFTA for short), no duty is payable on most products imported for personal use that are clearly marked as being made in Canada, the United States or Mexico. Products from Chile and Costa Rica might also be duty-free because Canada has separate free-trade agreements with those countries.
Also, if you were away for 48 hours or more, you can bring back goods exceeding your personal exemption, up to a value of $300, and pay a special duty of seven per cent if the products come from a long list of “most favoured nations”. You will, however, have to pay Canadian taxes on all purchases that exceed your personal exemption.
To estimate the duty and taxes on specific purchases, use the estimator on the Canada Border Services Agency website.
Apply for a U.S.-based credit card
If you’re a frequent visitor to the United States, you might want to apply for a U.S.-based credit card. Unlike a Canadian-based U.S. dollar credit card, a U.S.-based card does not charge a foreign transaction fee (usually up to 2.5 per cent) on purchases made in the States. That can really add up if you are a regular cross-border shopper.
A U.S.-based card can also make it less problematic to return items bought in the States, since you won’t take a financial hit if the value of the Canadian dollar dips after you make your purchase.
You can apply for a U.S.-based credit card through a Canadian bank. Check for a card that offers rewards programs or travel insurances so that you can benefit even more.
Open a U.S.-based bank account
The ideal partner for a U.S.-based credit card is a U.S.-based savings or chequing (or, as our neighbours say, checking) account. If you have both, you might pay off your credit card (or any American retail store cards) in U.S. funds from your bank account without incurring currency exchange fees.
If you often shop south of the border or you’re a snowbird who spends a couple of months every year in the States, you can regularly deposit money to your U.S.-based account when the exchange rate is favorable. That way, you won’t have to worry about a steep drop in the value of the Canadian dollar against the American greenback between visits — you’ll already have U.S. funds in your account to pay your bills.
Watch for Canadian-friendly deals
When the Canadian dollar is lower than the USD, it’s worth looking for special offers from U.S. businesses. After all, that “great price” you found at a boutique south of the border may not hold up once you calculate the exchange rate.
Many retailers, hotels and restaurants close to the border rely on Canadian customers. So, they often offer special deals, such as discounts or “Canadian dollar at par” promotions, to keep northern customers happy. Don’t be afraid to mention you’re Canadian and show your driver’s license to try to snag a deal.
To make spotting deals easy, sign up for newsletters and/or follow your favourite shops and malls on Instagram, so you’ll always be in the know. . You can do the same for hotels and restaurants. If you sign up for their loyalty program, some hotels will also send special offers via email, allowing you to plan your trip accordingly.
You’ll also want to pay attention to when U.S. stores hold big sales, often right after U.S. holidays (such as American Thanksgiving), in January and in late summer (mid-July through late August). Check for coupons and deals on websites aimed at cross-border shoppers.
It’s also worth doing some research on what truly is cheaper in the U.S., as you could find deals where you least expect them – such as on winter tires, bedding and toys. Even if your favourite brands aren’t offering great discounts, you could be saving on some essentials!
Consider the value of “hard-to-find-in-Canada” items
Great bargains aside, U.S. shopping may not always be a cost-saving exercise. But across the border, there are many shops and brands that aren’t in Canada (think Trader Joe’s and Target). If you approach your cross-border shopping trip as an opportunity to buy something you can’t find back home, the time and effort may be well worth the effort.
U.S. shopping trips have been popular among Canadians for decades – there is timeless appeal in hopping across the border for special deals, U.S. brands and Trader Joe’s dumplings. Planning ahead can help you take advantage of discounts while avoiding delays – allowing you to truly make the most of your cross-border shopping adventure.
Travelling to the U.S.?
Set up your U.S. banking and credit card before you travel to make life simpler.
This article is intended as general information only and is not to be relied upon as constituting legal, financial or other professional advice. A professional advisor should be consulted regarding your specific situation. Information presented is believed to be factual and up-to-date but we do not guarantee its accuracy and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the authors as of the date of publication and are subject to change. No endorsement of any third parties or their advice, opinions, information, products or services is expressly given or implied by Royal Bank of Canada or any of its affiliates.
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