If your business ships from Canada to the United States using Canada Post through Shopify, important changes are coming that will affect how you manage duties, taxes, and pricing.
Beginning August 29, 2025, all shipments from Canada to the U.S. must be sent as Delivered Duty Paid (DDP). The Delivered Duty Unpaid (DDU) option will no longer be supported by Shopify for Canada Post labels.
This change aims to simplify customs clearance and improve delivery speed, but it also requires sellers to update their Shopify tax and shipping settings — and potentially adjust product pricing.
Effective Date: August 29, 2025 Mandatory DDP for Canada Post U.S. Shipments $1.99 CAD processing fee per shipment CUSMA preferential rates not available with Canada Post Activate duty collection and update pricing before the deadline
What’s Changing
Shopify, in partnership with Canada Post and Zonos, is implementing mandatory duty pre-collection for all Canada-to-U.S. shipments. This means that duties and import taxes must be paid upfront—either by the merchant or by the customer at checkout.
If you continue using Canada Post for U.S. deliveries after August 29, 2025:
- You must prepay duties for all shipments.
- A $1.99 CAD processing fee per shipment will apply (included in label cost).
- DDU labels will be blocked in Shopify once the change takes effect.
What You Need to Do
Activate duty collection for the U.S. market
Go to Shopify Admin → Settings → Taxes → Duties and enable duty collection. You can either:- Include duties and taxes in your product prices, or
- Display them as a separate line item at checkout.
Shopify will estimate import duties and taxes at checkout and pre-collect them from customers.
Final charges are confirmed by U.S. Customs and Border Protection.Review your pricing
Duty-inclusive pricing helps avoid checkout friction and conversion loss. If you prefer not to absorb these costs, increase your U.S. catalog prices to cover duty and tax expenses.
Shopify’s duty calculator uses courier rates, not postal ones.
To match postal tariffs more closely, you can adjust your U.S. prices by the effective
IEEPA (International Emergency Economic Powers Act) duty rate for Canada, which is around 35%.Update product information
Add HS codes and country of origin to all products using Shopify’s bulk editor.
Postal carriers like Canada Post may not use these codes, but they’re still required for customs clearance
and are essential for commercial carriers.Ensure your labels are DDP-ready
DDP labels only become available after duty collection is activated.
Each shipment will include a declaration ID showing that duties were prepaid.
The ID doesn’t appear on the printed label but will show when scanned by the carrier or customs.
Understanding Duties and CUSMA Limitations
Canada Post uses a flat tariff system based on the IEEPA rate,
which is about 35% of the product’s value.
This flat rate applies even if your goods qualify for
CUSMA (Canada-U.S.-Mexico Agreement) preferential treatment.
Postal carriers can’t apply CUSMA rates because they don’t calculate duties by HS code.
If you want to take advantage of CUSMA duty reductions, switch to a
commercial carrier such as DHL Express or
Purolator, which can apply treaty-based duty calculations accurately.
