How do you successfully sell physical productson Amazon dot com if you are a Canadian citizen? In this video, I am going to go over all thethings that you need to know if you are from Canada, and you want to sell on Amazon's USmarketplace.
I initially made a video 7 months ago on howto incorporate your business if you are a Canadian citizen and you have interest onselling on the US marketplace.
However, I have an update for you guys, I'vebeen selling on Amazon dot com, as a Canadian citizen, I live in Canada, for over a yearnow.
So I just want to answer all the other questionsthat I have received after posting that first video.
So, if you are new to my channel, please subscribeand please hit that bell for more videos to come.
If you have not already, make sure you goback on my channel where I talk about opening a US-based dollar account.
This means that your bank is based out ofthe US, it's not a Canadian-based account.
So, don't walk into a Canadian bank and tryto open a US account, it's not going to work.
They can give you a US dollar account, butunfortunately, they cannot open a US-based bank account.
For US-based bank accounts, you're going tohave to pick up your phone and call RBC or BMO Harris.
So, that's RBC Georgia, or BMO Harris to opena US-based account.
This will help you when Amazon pays you yourbi weekly pay check every 2 weeks.
This will help you save on conversions, it'sjust going to make your life a lot easier.
Even when you make payments on Alibaba dotcom, to your supplier.
Everything is in US dollars.
So make sure you guys get yourself a US-basedaccount.
When you open up your US-based bank accountand when you open up your Seller Central account on the US marketplace, they are going to makeyou sign a W-8BEN form.
What this form means is that it tells theUS that you are a foreign person and that you are selling in the US marketplace.
So you don't get taxed in the US, and in Canada.
You're only going to get taxed in Canada.
So, if you are making your money on Amazondot com, all you do is report your taxes in Canada.
You don't have to report it in the US andthat's exactly what the W-8BEN form does for you.
You cannot escape this form.
The form is going to be handed to you everytime you tell Amazon or the bank that you are a Canadian citizen, you're going to haveto sign for this form.
Even if you are a sole proprietorship, youwould have to sign for this form.
And if you are operating under a corporation,you would also have to sign this form.
So you cannot escape it.
When you sign up for Amazon, they will justhand you that form and tell you to sign it.
When you sign up for a US-based bank account,they are going to hand you that form and tell you to sign it.
You can sell on Amazon dot com as an Individual,under yourself.
Or you could operate under a corporation,so you don't need to actually incorporate right away.
I do not suggest you guys to incorporate yourbusiness right away.
You want to be making steady sales first.
After you make some steady sales, it may betime to incorporate your business so you can lower that tax bracket.
I know everyone lives in a different provincein Canada, so your tax brackets are different from mine.
I am from Vancouver, British Columbia so Iam very well aware of my own tax brackets.
If I go over my personal tax bracket and ifI am making a lot of sales on Amazon which I think I am, I would like to say that I am,then it's time to incorporate my business.
Because under a corporation, your tax percentageis a lot lower than if you were to get taxed as an individual.
Make sure you talk to your account about this.
I am not an accountant, unfortunately.
So make sure you take this information witha grain of salt.
This is just everything that I have been throughthe last year.
And I've incorporated my business by myself,you can do so online by yourself.
It's pretty simple, unless you are forminga very complex corporation with multiple business partners.
You can totally do this yourself.
There is no protection if you were to sellunder an individual.
So if someone chokes on your product and theywant to sue you, they sue you.
They sue you and every single asset that isattached to you.
So that could be your car, that could be yourhome.
However, that's really.
you have a reallysmall chance of someone actually going after you for that.
But, if you are worried, and you do see Amazonas a long term business for yourself, then I suggest to incorporate.
However, when you incorporate, you have todo a lot of things on your own.
For example, for myself, I do bookkeepingby myself.
I have to keep track of all my expenses comingin and you know, my income coming in, and everything that I am spending.
You have to keep track of that to the T.
Youhave to be very accurate with that because the government, when you are a new business,the government has their eyes on you.
They want to know that you are reporting yourearnings and everything accurately so make sure you have an accountant that you can seekadvice from.
Again, this is just something that I've gonethrough the last year and I am still learning about this every single day.
I still get new advice from different typesof business owners.
But to find out a business plan that workswell for you, because we're all under different financial situations, right? There could, something may work out betterfor you but it may not work out better for me.
Make sure you talk to a business professional.
I am sure they can give you better advicethat will fit your situation.
So after you incorporate your business, youwill get a business number.
Every time you incorporate, the governmentwill give you a business number.
That is identical to an EIN.
So, in the US, they call it an Employer IdentificationNumber.
That's just the number of the business thatyou operate under.
So, if you were to open a US-based bank account,they're going to ask for an EIN.
An EIN is just your business number.
You can call and register a business numberunder a sole proprietorship as well.
Again, that's just to tell the governmentthat this is my business.
I know that there are some Canadians out therewho are still a little confused by this but you do not need an EIN if you have a BN, abusiness number.
It's the same thing.
It's just the number that you are operatingas under your own business.
So I hope that clears it up for you.
Another thing I want to tell you guys that,when you start making money on Amazon, you're going to have to keep track of a lot of yourexpenses, like I mentioned.
Even if you are a sole proprietorship, youwant to keep track of your expenses, keep track of your income, and at the end of theyear, your accountant will be able to easily report your earnings to the CRA, the CanadaRevenue Agency.
You do not need to open a business in theUS.
I actually don't suggest you guys to openyour business in the US because that will complicate everything, being a Canadian citizen.
Just simply make sure that all the earningsthat you make from Amazon dot com are reported to the CRA, if you are operating as an individualor under a corporation and you should be fine.
Everything is going to be fine as long asyou are reporting your earnings.
If you are American, you will have to chargesales tax for every single state that the customer buys from.
So that's very similar to Canada, if I buysomething from Ontario, I will have to pay taxes.
If I buy something anywhere within Canada,I have to pay taxes.
So that goes the same for Americans.
If they buy something from a different state,they have to pay taxes.
However, I've been told that since my corporationis based out of Canada, I don't charge international buyers any type of tax.
So I don't charge sales tax.
But I've also been told that if I were a reallybig seller making millions of dollars on Amazon dot com, in the US, the IRS may ask me tostart charging sales tax.
That's something you need to talk to youraccountant about.
However, I still consider myself as a smallbusiness so I am not charging sales tax for my products that are being sold on Amazondot com.
The CRA website actually indicates that youdon't charge sales tax to international customers.
So I hope that clears that up for you as well.
To make your life 10 times easier, it's probablybest to hire a bookkeeper or to hire an accountant to just go over a lot of these things foryou before you start your business on Amazon dot com.
A lot of this stuff, I learned on my own.
I read a lot of books.
I read a lot of blogs.
And it's just from talking to other businessowners and what they have advised me to do.
So far so good.
The only thing that I really don't like doingas a business owner, I do have a corporation, is that I have to keep track of all my expenses.
Everything that I am spending money on, allof my income, and then I have to report GST and everything else.
It's just a lot for me to do.
So I am actually planning to outsource thisto someone that I am having a meeting with.
I am planning to outsource my bookkeeping.
I am planning to just hire someone to do thisall for me.
I've been doing this really well on my ownfor the last half year.
I've been keeping track of everything that'sbeen coming in, all the money that's going out, but I've been quite busy lately.
And I think it's time to really out sourcethat.
So, I am going to make an update video foryou guys, after I file my taxes for my December year end.
And I'll talk to you guys about everythingthat my accountant tells me and what they suggest to do.
Or if they have any advice, I'll be sharingthat with you guys as well.
So I hope this video has helped you.
I actually would not worry about any of thisyet.
I would actually focus on learning how tosell on Amazon, how to really blow up your sales, how to choose a product, how to talkto your suppliers and really grow your business before you worry about any of this type ofstuff.
You can always outsource it later on afteryou have made some profits.
If you are Canadian, please check out FBAWinners Course.
It's very Canadian friendly.
I made a part specifically for Canadians,if you want to learn how to sell on Amazon.
If you guys have any questions for me, pleasecomment below, I respond to everybody.
Please give this video a thumbs up, if youliked it.
And please subscribe to my channel, I greatlyappreciate it.