In a succession of carriers carrying a specified cargo, each company is designated as an intermodal enterprise. Often, each company is discreet about when freight should be connected to another company. During an interline shipment, there are intermediaries who help with transportation coordination, including customs brokers and logistics companies. Sometimes a carrier comes between two carriers to act as an agent. In addition, freight will go through customs clearance and currency exchanges. As a courier that only offers Interline freight services, you do not take GST/HST from the carrier for these services. In this case, even if you are a small provider, you will benefit from registration for GST/HST, as you could use ITC for the GST/HST that you pay for or owe at a fee related to your interline services. 50. Freight services, considered to be carrier-to-carrier deliveries, which are part of a continuous movement of goods, are valued at zero, as interline freight invoices apply to domestic or international freight movements.
48. Interline`s rules in paragraph 1, paragraph 2, have the effect that such royalty-accepted deliveries can be assessed at zero in accordance with Part VI, Part VI, Section 11, without first having to determine the actual contractual relationship between the air carriers. 7. The concept of continuous freight movement is relevant to the tax treatment of interline accounts as well as to the zero rating regime for the domestic share of incoming international freight movements. In this example, ABC is the billing carrier and calculates the applicable GST/HST for freight services billed to the shipper. The amounts charged by DEF to ABC are estimated at zero. The amounts charged by ABC`s DEF for fuel and approvals are not considered to be interline invoices with zero valuation, but as refunds, and the applicable GST applies to them. Road services provided by Towing A or operators for towing A companies are not considered freight services. When a towing service sends an operator who represents only one road service, the service is not rated at zero in accordance with the interline rules and the amount charged by the operator for the service is not considered to be related to an interline freight bill. If the cargo is lost or damaged during transport, the carrier may be required, under the terms of the contract, to replace the goods or compensate the customer.
As a general rule, the compensation scheme that the carrier pays to an applicant is not subject to the GST/HST. The interline freight system is a system of relationships between road transport companies, rail networks and air transport networks.