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Valuations
Incoterms, Excise tax & duty, NRI
| Question | Answer |
|---|---|
| Who developed incoterms? | International Chamber of Commerce |
| When were incoterms developed? | 1936 |
| Why were incoterms developed? | To provide standardized rules, eliminated misunderstandings, disputes, and litigation. |
| Incoterms provide information regarding carriage of goods, customs clearance, costs, risk and the obligations to do what? | To give notice and to provide documentation |
| Incoterms provide information regarding the obligation to give notice and to provide documentation, customs clearance plus? | Cost and risk |
| Incoterms provide information regarding the obligation to give notice and to provide documentation, cost and risk and what else? | Customs clearance |
| What are the three words that cause confusion under Incoterms? | Delivery, ownership, and risk |
| Delivery and risk cause confusion under Incoterms what is the other? | Ownership |
| Risk and ownership cause confusion under Incoterms what is the other? | Delivery |
| Delivery, ownership, and risk should be clarified in the buyers and sellers what? | Contract of sale |
| Are incoterms terms of a buyer and sellers contract of carriage? | No, they are the terms of the contract of sale |
| Are incoterms a contract of sale under the law? | No |
| Incoterms 2010 consist of how many terms? | Eleven terms (11) |
| There are ten incoterms in the 2010 Incoterms developed by the International Chamber of Commerce | No eleven |
| Incoterms 2010 can be divided into two groups. What two groups? | Multimodal and ocean means of transport |
| Multimodal terms included EXW, FAC, CPT, CIP and? | DAT, DAP, and DDP |
| Ocean incoterms include FAS, CFR, FOB and? | CIF |
| Multimodal terms included DAT, EXW,DAP,CPT, and | DDP, CIP, FAC, |
| Ocean incoterms include FAS,CIF, FOB and? | CFR |
| Do Ocean incoterms include FAS,CIF, FOB and CFR? | Yes |
| Do Multimodal terms included DAT, EXW,DAP,CPT, DDP, CIP,and FAC? | yes |
| Do Ocean incoterms include FAS,CIP, FOB and CFR? | No CIP is multimodal CIF is ocean |
| In C incoterms the seller pays what? | main frieght |
| CPT | Carriage Paid To (named place of destination) |
| CIP | Carriage and Insurance Paid to (named place of destination) |
| CFR | Cost and Freight to(named place of destination) |
| CIF | Cost, Insurance and Freight to (named place of destination) |
| In D incoterms who bears all cost and risk? | Seller |
| DAT | Delivered At Terminal to (named place of destination) |
| DDP | Delivered Duty Paid to (named place of destination) |
| In the E incoterms who bears all cost and risk? | The buyer |
| In F incoterms who pays the main freight? | Buyer |
| FCA | Free Carrier to (named place of delivery) |
| FAS | Free Alongside Ship to (named port of shipment) |
| Excise Tax is also known as what? | Sin tax or Luxury Tax |
| Excise tax is applied to petroleum products, air conditioners for automobiles and what else? | Inefficient automobiles |
| Excise tax is applied to air conditioners for automobiles, inefficient automobiles and what else? | Petroleum products |
| The excise tax applied to air conditioners for automobiles has a few exceptions, what are they? | Air conditioners that will be put in an ambulance or a hearse, or those being put in vehicles used by persons under Foreign Missions and International Org. Act. These are not considered luxury vehicles. |
| When the goods subject to excise tax are manufactured in Canada the tax will be applied when? | The tax is payable when the goods are delivered to the purchaser. |
| When will the excise tax on a automobile being purchased for personal use from the US be applied? | The purchaser will have to pay excise tax and all other duties and taxes at the border. |
| What goods does the Excise Act pertain to? | Beer |
| What goods does the Excise Act 2001 pertain to? | Spirits, wine, and tabacco |
| Good subject to excise tax are listed where? | Excise tax goods are listed in Schedule 1 of the Excise Tax Act |
| When goods subject to excise tax are imported, when is the tax is due to be payed by the importer. | Goods imported require excise tax to be paid at the time of import |
| Manufacture of goods that are subject to excise tax must have what type of licence? | Excise Tax Licence (E licence) |
| Are all manufacturers of good that are subject to excise tax required to have a E Licence? | No, small manufactures (less than 50,000.00 in total annual sales) do not require an E licence (Excise Tax Licence) |
| Some companies who import goods that are subject to excise tax don't have to pay the excise tax when the purchase or import the goods. What type of companies are they? | Wholesalers who have a W Licence |
| A wholesaler in Canada, who has a W licence, imports excise taxable goods. When is the excise tax paid? | Excise Tax is collected and remitted when the goods are sold |
| Both the Excise Act & Excise Act 2001 impose excise duty | True |
| Canadian manufactured goods that are subject to Excise Duty require the duties to be paid when? | Excise Duty is to be paid at the point of packaging. |
| The Excise Act 2001 was amended by the minister of Finance on March 21, 2013 this Notice of Ways and Means Motion did what? | increased the rates of Excise Duty on manufactured tobacco |
| Are the Excise duties on imported wine, spirits, tobacco, and beer cheaper than those manufactured in Canada? | No, sections 21.0(1), 21.2(1) and 21.3 of the Customs Tariff makes the Excise duties owed equal on goods both manufactured or imported in Canada |
| What act legislates GST and HST | Excise Tax Act |
| HST is 13% in New Brunswick, Ontario, and what other province? | Newfoundland & Labrador |
| HST is 13% in PEI | No, 14% |
| HST in the highest at 15% in what province? | Nova Scotia |
| GST is 15% in Ontario | No 5% |
| A rate of 15% of HST is applied in New Brunswick | No 15 % is Nova Scotia, NB is 13% |
| What 3 provinces are subject to 13% HST | Ontario, New Brunswick, Newfoundland & Labrador |
| Is GST & HST applied to all goods and services? | No, some goods and services are exempt, zero rated, or non-taxable |
| What type of goods and services are Zero-rated and do not have GST or HST applied to them? | Those that are considered a necessity of life |
| Examples of Zero-rates goods and services include: milk, bread, veggies, grain and raw wool, medications and their dispensing fees as well as? | Medical devices (hearing aids and dentures |
| Goods and services exempted from GST/HST are those considered to be? | Goods and services that are a necessity, and are not used or purchase out of choice |
| A new home is exempt from GST/HST because a home is an necessity | No a new home is not exempted, a used one is. |
| Medical, health, and dental services such as teeth whitening are exempted from HST/GST | No teeth whitening is an elective service. |
| Services performed by a lawyer are exempted from HST/GST | No legal aid is exempted |
| Was GST/HST applied to our tuition? | No because educational services with a certificate/diploma are exempted |
| All medical services provided by a licensed physician or dentist are exempted from GST/HST | No not all only required services are excempted |
| Loan, mortgage services provided by financial institutions are exempted from GST/HST | yes because these services are a required service |
| ITC | Input Tax Credit |
| ITC registration allows an importer to do what? | Collect and remit GST/HST |
| ITC is filled annually | yes but ITC can also be filled monthly and quarterly |
| Non-resident importers do not qualify for ITC because they are not considered Canadian | No, they qualify based on the use of the flow through method of tax recovery or by registering for a GST/HST number |
| Provincial Sales Tax (PST) is collected on commercial goods at the time of import | NO It is applied to goods destined for personal/individual use |
| Goods that are exempted from GST are not exempted from PST | No, PST is only applied to the same goods that GST is applied to (unless specifically exempted) |
| NRI | Non-Resident Importers |
| Importers located outside Canada, who choose to be responsible for any applicable duties and taxes are considered to be? | Non-Resident Importers (NRI) |
| Being as an NRI is not a Canadian company they are not required to register for a GST/HST number, they are exempted from paying GST/HST on goods | No they need to register for a GST/HST number, and a business number in order to claim ITC on GST/HST they have paid on imported goods |
| Does a NRI have to register for GST/HST number when they are considered a small importer? | No |
| When an importers (and those associated with them) have a revenue from worldwide taxable supplies that is 20,000 or less in a calendar year and a quarter they are considered a small non-resident importer | No its 30,000 or less to be a small NRI |
| Public service bodies who's revenue from world wide taxable supplies is considered to be a small organization if it is lower than? | 50,000 in a calendar quarter and over the last consecutive calendar quarters |
| NRI Charities and public institutions are considered small suppliers if they meet the gross revenue test of? | 25,000 or less |
| NRI obligations include paying any applicable duties and GST/HST on imported goods | true |
| NRI who are not registered for GST/HST can still take advantage of ITP | No, but they can use the "Flow through method of tax recovery" |
| What is the "Flow through method" | When a NRI who is not registered with GST/HST charges their Canadian customers more for the goods and services in order to be reimbursed for the amount paid on GST/HST |
| A NRI is required to maintain records within Canada, who can they authorize to do this for them? | Customs broker, accountant, or another authorized agent |
| In order for a NRI to have a agent authorized to maintain their records they must do what. | Submit a request in writing for review and approval by the CBSA that indicates the business address where the records will be kept and the relationship between the agent and the importer |
| When the CBSA has authorized an agent to maintain records for an NRI, the agent is responsible for all legislative requirements of 40 (1) and 43 (1) of the Customs Act | No, the importer is still responsible |
| Customs Act subsection 41 (1) and 43 (1) outline the legislative requirements for NRI | No 40 (1) and 43(1) |
| NRI's who fails to comply with requirements of record maintenance specified in 40(1) of the Customs Act maybe subject to? | a) AMPS penalties (Sec 109.1(1)) b) detention of imported goods until requirements are met (Sec 41) |
| Non-resident Importers MUST register for GST/HST when | A large importer Make goods for a place of amusement, seminar, activity, event EVEN small importers Host a convention and more than 25% of the delegates are Canadian residence Big supplier who solicits sales of books, newspapers magazines |
| NRI's are traditionally what type of corperation | Huge corperations |
| How many years must a NRI keep their records in Canada? | 7 years |
| Who is most often hired to maintain records for NRI? | 90% of the time it's the broker |
| PST on tobacco tax, alcohol mark ups & fees, Que alcohol specific tax are are payable at the time of import on casual goods destined for what type of use? | Individual or personal use |
| PST is ONLY collected on goods that are subject to GST, unless what? | A province has specifically exempted the good from PST |
| PST is NOT collected at the time of importation on commercial goods | True |
Created by:
susancurtis
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