We all know that an audit – or Trade Compliance Verification – by the Canada Border Services Agency (CBSA) is a looming possibility for anyone involved in cross-border trade. And recently it seems that audits are becoming more frequent. Not surprisingly, CBSA is very interested in ensuring the rules are followed and importers are paying the applicable duties and taxes.
The CBSA has greatly improved their targeting process of late – meaning they are better than ever at identifying potential errors in matters of tariff classification, tariff treatment and valuation.
The audit process
You should be armed with the knowledge that you could be audited by a random verification or a targeted verification at any time.
Random verifications are just that – random – and can happen to anyone, regardless of what they import. CBSA uses the results of random audits to measure risk assessment and revenue assessment, and to promote voluntary compliance.
In addition, CBSA publishes a list of “targeted verification priorities” several times annually, identifying where they will focus most of their verification efforts. The list identifies specific industries and goods that have shown to have a higher risk of noncompliance and that CBSA will therefore pay special attention to when it comes to audit efforts.
Are you prepared?
By performing a periodic risk analysis of your customs transactions, your chances of being selected for an audit can be substantially reduced. Not only that, but regular routine risk analysis will provide visibility on your trade activity and customs documentation, with the added benefit of a more complete understanding of the process. This improved understanding may even lead to the identification of further opportunities for duty relief or recovery.
In today’s stepped-up compliance environment, every importer should be conducting regular internal risk assessments. But we understand that dedicating the requisite time and resources to these tasks can be difficult and time-consuming.
Our experienced customs professionals are knowledgeable about CBSA audits and risk assessments. We can help you reduce your risk and help guide you through the audit process when it happens.
Information provided by: Canadian Customs Consulting Dept. - Cole International