I'm still getting lots of mail about GST and HST, mainly about whether businesses should be charging GST (the Goods and Services Tax), HST (Harmonized Sales Tax), PST (Provincial Sales Tax) or what when they ship goods and/or services out of province.
For instance, K.S. writes:
I am a little confused on the HST rules. We are a business based in Quebec. If a supplier from Ontario ships us merchandise to our plant in Quebec, should they invoice us HST and QST on top of HST?
The taxes you charge depend on where you're shipping to. As I explain in Online Business and HST, if you are selling goods or services out of province, you charge the GST/HST rate based on where the goods are being shipped to.
Therefore, if you ship to B.C., charge 12%, to Ontario, Newfoundland and Labrador, or New Brunswick, charge 13%, to Nova Scotia 15% and if you sell to Alberta, Manitoba, Saskatchewan, Quebec or Prince Edward Island, the Northwest Territories, Nunavut or the Yukon, only charge 5% (the GST rate).
So K.S.'s supplier should only be charging her 5%, the GST rate.
As to how to charge taxes, this pair of sample invoices include an explanation of what has to go on your invoice:
More on HST
- What You Need to Know About Ontario HST
- What You Need to Know About BC HST
- HST & Intangible Personal Property in Canada
- Charging HST on Services
And, of course, the Canada Revenue Agency has lots of information on HST and is ready to assist you. Visit their "Harmonized Sales Tax (HST) for Ontario and British Columbia" page or phone them at 1-800-959-5525 (TTY 1-800-665-0354).
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What tax(es) would you charge if you live in Alberta, bought from an online store in Alberta, but had that store ship directly to Ontario? (In other words the invoice stays in Alberta but the product ships to Ontario)
Hi Steve, I would say this falls under point 2 in the article: “2) if you are selling goods or services out of province, you charge the GST/HST rate based on where the goods are being shipped to.” In other words, Ontario HST. If you want to be absolutely sure though, you should check with the Canada Revenue Agency’s GST/HST division.
And what if it was shipped out of the country? I am an Alberta company, purchased something from Ontario, and becasue they shipped it late, we asked them to ship directly to our guys working in Mexico…. do we still get charged HST? I know if shipped here to Alberta, they would only charge us GST.
Hi Jen, No, this is a whole different kettle of fish. Now they are getting into exporting and presumably someone is going to have to pay the customs fees, duty etc. Personally never having shipped anything to Mexico, I can’t tell you what these would be but they will need to find out through CRA’s exporting division. One way or another, though, you should not be charged HST.