How to Import Clothing into Canada

If you are a Canadian brand importing clothing for the first time, the number you need is not the factory quote. It is the landed cost: what leaves your bank account by the time the boxes are in your warehouse in Toronto, Montreal or Vancouver. This guide sets out every line that goes into it, and the paperwork the Canada Border Services Agency expects when you import clothes for resale.

We are a knitwear factory in Bangladesh that ships to Canadian brands, so treat the sourcing advice as interested. The trade facts below are all sourced to CBSA, the Canada Gazette and the legislation itself, and you should check them rather than take our word for it.

The short version

• Duty on apparel from Bangladesh: 0%, under the Least Developed Country Tariff. Not a temporary concession — Parliament renewed it in legislation to 31 December 2034.
• GST: 5% on the value of the goods. That is a tax, not a duty, and if you are GST-registered you claim it back as an input tax credit.
• One extra form for clothing: CBSA form BSF255, the certificate of origin for textile and apparel goods from a least developed country.
• CUSMA does not apply. It covers Canada, the US and Mexico. Goods from Bangladesh enter under the LDCT instead, which for apparel is the better deal anyway.

Why Canada is the most certain market Bangladesh has

This is the part most sourcing guides miss, and it matters more this year than it ever has. Bangladesh is scheduled to graduate from least developed country status on 24 November 2026, and in most markets that creates real uncertainty about what duty will be owed afterwards. The UK and EU offer transition arrangements that eventually run out. What comes next is not settled.

Canada dealt with the question in advance. The Budget Implementation Act, 2023, No. 1 renewed the legislative authority for the General Preferential Tariff and the Least Developed Country Tariff through to 31 December 2034, and Parliament passed provisions allowing countries that graduate from LDC status to keep that access. In other words, the thing every other market is anxious about was legislated for here years ago.

Bangladesh has had duty-free, quota-free access to Canada under the LDCT since 2003. Around 98.9% of Canada's tariff schedule enters duty-free from least developed countries, a figure published by Bangladesh's own National Board of Revenue. Ready-made garments, knit and woven alike, are covered.

How Canada compares to the other markets you might sell into

Rules of origin — the part that used to be hard

A tariff preference is only worth anything if your goods qualify for it, and for apparel the origin rules used to be the obstacle. Historically a garment could fail the test because the yarn or fabric came from somewhere else, which is a problem for almost every factory in Bangladesh, ourselves included — we cut and sew in our own building and buy knitted cloth from partner mills.

That changed. Under the rules described in CBSA Customs Notice 24-41 and Memorandum D11-4-4, the LDCT origin rules for apparel permit production in a least developed country from imported yarns and fabrics. Cutting and sewing in Bangladesh confers origin. There is no yarn-forward requirement and no value-added percentage to hit.

Practically, this means you should not accept a supplier telling you your order might not qualify because the fabric was knitted elsewhere. Ask instead whether they will issue the certificate, which is the thing that actually matters.

The paperwork for importing clothing into Canada

Four documents move with a clothing shipment into Canada. Three are ordinary; one is specific to textiles.

• Commercial invoice — the value CBSA assesses GST against. It must reflect the real transaction price.
• Packing list — cartons, weights, contents.
• Bill of lading or air waybill — from the freight forwarder.
• CBSA form BSF255 — Certificate of Origin: Textile and Apparel Goods Originating in a Least Developed Country. This is the textile-specific one. It covers goods in HS chapters 50 to 63, which is where clothing sits, and the importer must declare they hold it in order to claim the LDCT rate.

The BSF255 is completed and signed by the exporter — your factory — not by you. It is worth asking for a sample copy before you place the order rather than discovering at the border that your supplier has never issued one. A factory that exports to Canada regularly will send it without hesitating.

GST, and why it is not a cost

Canada charges 5% GST on imported goods, calculated on the value for duty. Because the duty is zero, that is 5% of the invoice value. Founders often read this as a 5% cost and price for it. It usually is not one.

GST on imports is an input tax credit. If you are registered for GST/HST, you claim it back on your return in the ordinary way, exactly as you would on any other business purchase. It affects your cash flow between paying it at the border and recovering it on your next filing, so plan for the gap, but it does not belong in your unit cost. Provincial sales tax treatment varies by province and is worth a five-minute conversation with your accountant before your first shipment rather than after.

DDP or FOB — the decision that decides your real cost

This is where quotes stop being comparable. FOB means the supplier's price covers the goods loaded at their port; freight, insurance, customs brokerage, the GST and delivery to your door are yours to arrange and pay, and they arrive as separate invoices over the following weeks. DDP — delivered duty paid — means the supplier quotes one number that covers all of it.

Neither is dishonest, but an FOB quote will always look lower than a DDP quote for the same goods, and new brands routinely compare one against the other without realising. If you are gathering quotes, ask every supplier for the same basis. If a factory cannot quote DDP into Canada at all, that tells you something useful about how often they actually ship here.

One further point specific to Canada: whoever is named importer of record carries the compliance obligation, including retaining that BSF255 for CBSA's record-keeping period. Under DDP the supplier usually handles entry, but the goods are still yours. Ask explicitly who is named, and keep your copies.

What Canadian brands should specify differently

Two things are worth building into the spec rather than discovering after a season. The first is weight. A great deal of imported knitwear is specified for markets that do not have a Canadian winter, and a 240 GSM hoodie that sells well in Sydney is a mid-season piece in Winnipeg. For a genuine winter range, look at 380–450 GSM brushed fleece, and consider a thermal or waffle layer that most catalogues do not carry by default.

The second is the calendar. Sea freight to the West Coast is meaningfully faster than to Eastern Canada via the Panama Canal, and both are slower than most founders assume. A realistic total is around 40 to 50 days from an approved sample to dispatch, then transit on top. Work backwards from your on-sale date and place autumn/winter orders earlier than you think you need to.

How to sanity-check any supplier's Canadian claims

Everything above is checkable, which means you can test a supplier against it in about five minutes.

• Ask what duty applies to your goods entering Canada. The answer should be 0% under the LDCT, and they should know the programme by name.
• Ask whether they will issue form BSF255. If the question confuses them, they have not shipped apparel to Canada.
• Ask for a DDP quote to your address, not FOB from their port.
• Ask who is named as importer of record, and get the answer in writing.
• Ask what happens after 24 November 2026. A supplier who says the duty position changes for Canada is wrong, and you have just learned how carefully they follow the rules that govern your money.

If you want the commercial side rather than the customs side, our page for Canadian brands covers minimums, lead times and what we make. If you are still choosing a country, Bangladesh vs China vs Vietnam compares the three on cost, capability and duty.