Advice for Canadian internet retailers wanting to do business in the U.S

[votrechien1]

@Pachenko

The webstore shows varios currencies depending on what your preferences are but since most of our possible clients will be in the U.S. it will show USD.
Right now my possible business partner and i are looking at registering an LLC company in Buffalo and crossing over to send shipments and just running the website/processing orders from Toronto. But this raises doubts. If i am an e-retailer in Ontario with my product in the U.S. i suppose we would have to register the company in Ontario as well if we receive payments in a Canadian bank.
I ran into your post researching different ways to do this and maintain costs low (Shipping from Toronto to the US was painfully expensive as most of our products our big and bulky) and you seem to have a viable way of doing this that might be an option for us. If we ever get this off the ground, we would be very a very small outfit with only 7-8 products to start with.

Some comments:

1. Are you both Canadian and working from Canada? Most people (and more importantly, the CRA) would deem that you are a Canadian business that is simply fulfilling orders from the U.S… Where you are shipping products from doesn’t normally determine what area your business is based in (but it does determine sales tax collection).

It’s hard concept to absorb that shipping products from the U.S. doesn’t necessarily make you a US company.

2. Registering a LLC in Buffalo is probably not what you want to do. Again, if your so called ‘mind and management’ is in Canada, you’re a Canadian business. All you need to do is collect and remit NY sales tax (relatively easy to get registered a foreign company doing this- simply call the NY department of revenue and they can help you).

3. I believe driving across the border and shipping packages is OK (my only backup for this belief though is that I know other people do this). However, assuming it is OK you are opening yourself for a lot of hassle. Aside from border wait times, if you do a lot of business you may get called in to pay duty every time. I believe you also have to pay an ‘access fee’ of around $10US if you’re crossing the border for business purposes like you are and they may start to make you go through the commercial border crossing (which can be worse than the public crossing).

Long story short, call any mail delivery service in Buffalo and probably half of them will be happy to store your items for you and ship them out for you for a modest price. Much easier (and probably cheaper).