There is no difference between GST zero-rated and exempt goods and services from the point of view of the customer; in neither case does he or she get charged GST.
However, from the point of view of the business owner, there is a difference in how the two classes of goods and services are treated when filing a GST return.
When you fill out your GST return, you can claim Input Tax Credits (ITCs) to recover the GST HST you paid or owe on your business purchases and/or expenses.
While you don't charge or collect GST HST on zero-rated goods and services, you can still claim ITCs for them on your GST return.
On the other hand, you cannot claim ITCs for exempt goods and services.
Examples of GST zero-rated and exempt goods and services.
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