Do I charge GST or HST on the sale of goods and services to another province? Watch Video
Allan Madan, CPA, CA
“Do I charge GST or HST on sales to another province?” If you are a nationwide business, Read More…
Disclaimer
The information provided on this page is intended to provide general information. The information does not take into account your personal situation and is not intended to be used without consultation from accounting and financial professionals. Allan Madan and Madan Chartered Accountant will not be held liable for any problems that arise from the usage of the information provided on this page.
ABOUT THE AUTHOR
ALLAN MADAN
CPA, CA
Allan Madan is a CPA, CA and the founder of Madan Chartered Accountant Professional Corporation. Allan provides valuable tax planning, accounting and income tax preparation services in the Greater Toronto Area.
Hello.
I started a business last year, and applied for and HST number. I collected HST for my sales. However, my business wasn’t as successful as I thought, and I gave up on it. I still have a couple of invoices to send, but I’m wondering if I have to bother with the HST just because I have the number and have been collecting it. If I have sales less than $30k a year and I have a number, do I have to collect HST because I have the number? Can I just ignore it and send out the invoices without HST?
Dear Mr. Morrisey,
You would have to deregister the account. The information you need to do so is here: http://www.cra-arc.gc.ca/tx/bsnss/tpcs/gst-tps/bspsbch/cncllng/menu-eng.html. The CRA should tell you when the effective date that you are deregistered, until which you are supposed to keep collecting. Otherwise, you will be liable for any HST not collected. Also, collecting it from clients or customers after the fact usually doesn’t go well!
Alternatively, you may consider keeping the account open. That way, you can file nil returns once a year. If you decide to get into any other business as self-employed, you can still use the same account.
Regards,
Allan Madan and Team
I own a marketing firm in which we provide services to people all over Canada. We help other companies with creating company logos and graphics as well as improve their marketing for their website. If we are helping with website marketing for a company in another province, do we charge GST and HST according to the province we reside in? Or are the GST and HST based according to where the company we are providing the service is?
Hi Aaron,
It seems that most of the work is web-based and does not require it to be sent to the clients. If this is true then you base the GST and HST on the place in which the service is performed. So in this case the GST and HST will be that from where your company resides.
Regards,
Allan Madan and Team
We are currently providing sub contracting work for a Quebec based firm with the work being done in Quebec. Do I charge the Ontario HST for this?
Hi Martin,
If the billing address is in Quebec, then charge GST.
I own my own bookkeeping business in BC, and I have new clients coming from Ontario for which I supply training for Quickbooks Online,as well as performing monthly reconciliations for them, I just want to confirm, because it is a service performed in BC, that I will only charge these clients GST and not HST. Up until this month I did not need to register for GST.
Hi Marlene,
GST/HST is charged according to the billing address of the client. So long as the client’s address is in Ontario, you will have to charge HST (13%) at Ontario rates, irrespective of where the services are performed.
I am setting-up a dropship ecommerce business that will be registered in Quebec. The clients will place an order on my website for physical goods, I will process their payment, then order from a supplier that will deliver the goods directly to my client, under my name. I do not see or touch the goods, but pay the supplier and deal with the taxes:
1. If my client is in Ontario, and the supplier is in another province (not QC), what sales tax do I charge?
2. If my client is in Ontario, and the supplier is in Ontario, what sales tax do I charge?
3. If my client is in Ontario, and the supplier is in Quebec, what sales tax do I charge?
My guess here is that in all 3 cases I need to charge HST of 13%, but I am confused by reading about not having to charge provincial tax to residents of other provinces. However Ontario has both taxes rolled into HST, so how I am not supposed to charge provincial tax? Please help, this is quite confusing.
Hi Alex,
Sales tax (GST + PST, or HST) is charged based on the province of delivery of the goods. In Ontario, both provincial and federal sales taxes are combined into one – HST at rate of 13%. HST collected is reported on a GST/HST return.
I AM a small graphic design business in Quebec. ..what tax do I charge for Web design services done on a website for a small holistic company in ontario. the web design services are done online here in my Quebec office.
Hi Lee,
Charge HST because the customer is located in Ontario (i.e. Ontario billing address).
Hello Allan,
Thanks for the useful information you posted on this page. However, I still have a question regarding my situation and it would be great if you could please help clear my confusion.
I am an Immigration Consultant (registered my business in ON – not Canada wide) and will be starting my business soon. But before I charge my future clients, I like to understand the taxation aspect fully. I understand that I cannot charge any tax to overseas clients, but for example, if a client is in some other province (regardless of participating in HST), do I still charge them ON HST (as I am only registered in ON) or that province (HST or GST)?
Please note, I am not sending any documents to the client physically but I have to obtain a clients address (personal or business) for my Retainer Agreement and Invoice. I am providing consultation in person/on call/email for clients in ON, and on call and email only. The paper work is done in ON and I am not sending or delivery any documents to clients physically. Everything on email.
I have tried to search everywhere but I am unable to find this answer. I hope I can get some help from you.
Thanks,
Hi Mark,
Charge GST or HST based on the client’s address. For example, charge HST for Ontario customers, and GST for BC customers. Then complete a combined GST/HST return for the reporting period (quarterly or yearly).
Hello
I work for a consulting company in Ontario. One company we work with is another consulting company based out of BC. They contract out work to us. We perform work for their clients across the country including site visits and meetings in multiple provinces as well as reports sent via email. We are billed by the consulting company in BC regardless of where their client is located. Should we be paying 5% BC tax all the time even if their client we are completing the work for is in Ontario?
Hi Jamie,
Charge GST or HST based on the billing address of your customer. Your customer is the person / entity that is paying you. From what you have told me, your paying customer is in BC, and so 5% tax (GST) should be charged by you to your BC customer.
I am an Ontario based company providing web design and marketing consulting services to a company in Alberta. What do I charge them tax wise?
Thank you!!!
Hi, Tracy. You should charge them GST at rate of 5%.
Hi Allan,
Thank you for the great article, that helped me understand a bit better the GST/HST process, but I have a question. Do I need to apply for GST/HST if I start a small e-commerce business to sell goods in Canada even I am not expecting to collect more than $30,000 of revenue per year?
Hi Nick, if your total sales are less than $30,000, then you do not need to register for GST/HST.
Hi there , I am receiving training in Alberta, from an Ontario based company. The entire program I am paying for occurs in Alberta . Do I still have to pay GST and HST or am I simply required to pay GST on the course fee being that it occurs and is delivered 100% in Alberta….
Hi Erin, if you are a resident of Alberta, then the training provider should charge GST (5%) on the training fees billed to you.
I am starting a subscription/membership website that will allow holiday cottage owners, who are looking to rent out their properties to guests to earn extra income, to add listings of their properties with descriptions and photos. Interested guests will contact owners to make reservations via my website. I will charge cottage owners a fee to post a 1-year listing of their property. I live in Ontario but cottage owners from across Canada (each province and territory) will be able to subscribe for an annual membership and list their properties. Do I have to charge taxes? Or is a subscription/membership based website exempt? I am very confused and would greatly appreciate any help in figuring this out. Thanks, in advance, Elizabeth.
Hi Elizabeth, you must charge GST/HST on the subscription fee at the rate in the province where your customer is located.
I am an independent contractor in Toronto, providing engineering consulting work. I went to work in Montreal for 2 weeks for a Quebec based company, and then returned home to Ontario. Do I need to register and charge my Quebec client QST for those 2 weeks worked there? Or should I charge them just GST
Hi Francis, just charge them GST.
Hello,
I’m in Ontario and I develop and sell software to a client in BC. Should I charge them 5% (GST) or 12% (GST+PST)?
Thank you.
Hi Mike, charge them 5% GST.
Hi, I am in Alberta now and I called a company (who is located in Newfoundland) to pick up my household goods and ship them to my new place here in Alberta. Now the bill they gave to my brother who was there in Ontario at my old address for the pick, has HST charged on it, but I believe I should only be paying the Alberta 5%. Am I correct?
Thank you,
Kevin
Hi Kevin, the tax rate should be 5%. Ask them to revise the invoice with your Alberta address.
Hello,
We are a service company in Manitoba. We hire a subtrade (electrical) to do work for us at a location in Ontario. Should they charge us HST for the work they do in Ontario even through the billing address is in Manitoba? Thanks!
Hi Phil, the should charge you GST of 5% and not Ontario’s 13% rate, since you (client) are located in Manitoba.
Hi Allan –
I have a consulting firm where I charge clients for consulting – all of which is delivered remotely (email, phone, video conference, etc). I reside in Ontario but have now started taking on clients in BC and Alberta. Which tax should I charge?
Thanks
Megan
Hi Meaghan, charge the federal GST (5%) to customers in Alberta and BC.
Do I charge GST or HST on sales to another country? Especially remote software consultant service.
Hi Morgan, no, you do not.
Hello,
I started a cleaning business. My business address is in Gatineau Quebec. I do the cleaning in Ottawa Ontario. What tax do I charge? I will also do business eventually in Qc, so my second question would be can I apply for a TPS TVQ and HST number through Revenu Qc? Thank you.
Hi Ursula, charge your Quebec customers QST and GST. Charge your Ontario customers HST. Call 1-800-959-5525 to register for a GST/HST account.
Hi,
I import steel parts into ON. I collected HST for ON sales.
However for selling in QC what taxes should I charge
1. if I am shipping to Montreal? Will it be 13% HST on my sales invoice
2. if customer is picking up from here? Will it be 5% GST on my sales invoice
How is the GST/HST to be reported for the period?
Also
Hi Mashadi, if you ship goods for delivery to a customer in Quebec, then charge that customer GST (5%) and QST (9.975%). However, if a customer picks up the goods from your Ontario location, then charge that customer HST (13%).
Hello,
We are company in Ontario. And we sell steel tubes to Quebec clients . What we suppose to charge ? Only GST? Thank you.
Hi Jane, charge both QST and GST.
Hi, I live in Alberta and am having music CD manufactured by a company in Ontario who will ship them to me. They told me “We’re required to charge HST 13% Ontario tax.” Is this right? The difference is 8% more in taxes. I want to make sure.
Thanks!
Hi Andre,
5% GST should be charged because the goods are being delivered to Alberta.
Hi Allan
A client has a business in Montreal and purchases materials and services for the business in Quebec and Ontario however all sales are done in the usa and very little sales in Quebec can he still claim the gst pst and hst on purchases made. How many returns he has to do in Quebec ? I was told there may be 2
Hi Kathy,
Goods delivered to customers residing in the US by a Montreal based company are not subject to the GST/QST. These goods are “0” rated as per the Excise Tax Act. As such, input tax credits can be claimed by the Montreal based company for GST paid on purchases of materials and other expenses.
HI,
I moved from QA to BC and I am incorporate and I do have my TPS and TVQ numbers.My client now in BC, how much I need to charge them ? do I need to register for another TPS number in BC or I can use the same one from Quebec (I already registered my company here in BC).thanks so much.
BIHI
Hi,
Charge the Federal GST (5%) on the goods that you sell to customers located in BC. Also, most goods sold to customers located in BC are subject to BC Provincial Sales Tax, even if your physical place of business is outside BC. For further details, please see:
https://www2.gov.bc.ca/gov/content/taxes/sales-taxes/pst/register
This is great information but I can’t find any reference to British Columbia (the one place I need answers for). In fact, I was hoping to find out whether a BC company paying an Ontario company for services can write off the whole HST amount or just the GST (5%) portion. I’ll keep looking.
In any case, we’re here! Please don’t forget this beautiful, supernatural chunk of paradise on the west coast.
Hi Liessi,
The Ontario company should have billed you GST only (not HST) if you are located in BC and if:
1) The goods purchased were delivered to you in BC; or
2) The services provided to you where billed to a BC address
As such, you will only be able to claim-back the GST, and you should ask the Ontario company to revise its invoice.
Hi,
I work for a staffing company in Alberta providing staffing services in Quebec customer, our people are working physically in customer premises in Quebec. What are the taxes that I need to charge to my customer?
Hi Maria,
Charge your customer QST and the federal GST.
Hi there,
I’m a Montreal-based copywriter providing writing services for a new client with a business address in Vancouver. Do I just bill GST? Does PST come into play? Many thanks!
Hello,
Charge the federal GST of 5% only to the client.
Hi there,
Starting a small business – retail and wholesale jewellery. With our wholesale clients, I can’t find the information anywhere how we are supposed to charge tax. If a clients buys wholesale, do we charge them tax? Because they are then selling the item in their store and charging tax. Does that not mean that the same item has been taxed twice?
Please help,
C
Yes, you must charge GST/HST to your wholesale clients. They will not be double taxed, because if they are purchasing goods for resale, they can apply for a GST/HST refund (i.e. input tax credits) for the GST/HST paid on the inventory purchased from you.
Hello,
If as an Ontario based wholesale distributor, I ship goods to Newfoundland and charge the customer 15% HST, how do I deal with the 10% collected PST (from Newfoundland) when I file my HST return in Ontario where the business is based. In other words, how to deal with all the PSTs collected as part of the HSTs from provinces participating in HST.
thanks
Hi Wardak,
The entire amount collected is report on the HST return. It is not broken down between the provincial portion and federal portion on the HST return.
We are a consulting business operating in Ontario. We now have a client headquartered in Quebec. Do we charge HST or PST to our client? Many thanks!
Hi Suzanne,
Charge your Quebec customer the Quebec PST and the Federal GST on the invoice amount.
Hi,
I’m in IT consulting business here in Toronto, Ontario. I managed to get a contract which is in Manitoba. I’m going to support the Manitoba company remotely from my home office. I just saw the contract provided by the agency and it only mentioned GST. Do I need to charge them the Ontario PST which in total should be a combined HST 13% the same as here in Ontario?
Thank you.
Hi Ronald,
Charge 5% PST to your customer in Manitoba. Services are not subject to Manitoba Retail Sales Tax unless they are specifically listed as taxable. See this bulletin for more information.
My client has manufactured a product and is getting ready to sell to clients and supply wholesalers. The company is based in Manitoba so I’m wondering what taxes need to be charged (Manitoba has a 5% GST and 7% PST). The product will be sold to all provinces and also into the USA (and possibly worldwide). Does he charge individual personal sales the MB taxes or the taxes for which the product will be sent to? Does he charge taxes to the wholesaler or is that the responsibility of the wholesaler to charge the taxes to their customers and then remit?
Hi Sharkee,
It appears that your client’s customers are wholesalers. As such, your client should charge the PST and GST (HST for harmonized provinces) applicable for the Province where the goods are shipped to (i.e. wholesaler’s location).
Hi, we are a Quebec based company that sold goods to a hotel in Ontario.
Now, a third party company based in Ontario sent us an invoice for “commissions/referral fee” for that original sale of goods (a % of the goods value).
Should they be charging us HST or only GST?
Hi Jake,
The Ontario based company should charge GST to your company since your company is located in Quebec.
Hi there
WE are a company based in BC however I do work in Newfoundland. What do I charge them and do I have to submit the full amount of tax charged to Rev Canada even though I am not in Newfoundland ?
Hi Elanie,
Since you are billing a customer located in NL, charge 15% HST.
If I buy a product from a vendor from Alberta and he doesn’t charge me the PST (Qc: 9,97..), am i liable in anyway or is it the vendor responsibility to charge provincial taxes. It’s possible that the vendor doesn’t reach the 30 000$ minimum sales requirement. the 30 000$ sales threshold in the province of QC, per the new law, is for the period between Sept 1 2019 and August 2020. Can they retroactively tax the goods? Are the first 30 000$ exempt of QST?
Thanks in advance.
Hi John,
The vendor is responsible for collecting sales tax.
Hi,
We are an office and school supply company located in Quebec. If we sell to a client in Manitoba do we have to charge them the PST of 7% in addition to the 5% GST? Thank you.
Hi Marlene,
Yes, you will charge the applicable sales tax rate in Manitoba (place of delivery), which is PST of 7% and GST of 5%, for a total of 12%.
Hi Allan,
We are a law firm based in Ontario that provides legal services to clients from various provinces such as Alberta, Saskatchewan, New Brunswick, etc. All the work is performed here in Ontario so I believe we should be charging 13% regardless of where the clients are from. When for example we need the client to sign an original document, we just book a local office let’s say in Saskatchewan and they just go there and sign the documents.
Hi Ianik,
The sales tax rate applied should be consistent with the province specified in the billing address of the client. For example, if a client has an AB billing address, then charge GST of 5%. The fact that the services are performed in Ontario is not relevant.
Hello. As an HR Consultant in BC, I currently send my invoice to a Consulting company who then charges the client. I charge 5% GST on my invoice to the Consulting firm. I now liaise with a new Consulting firm in Ontario, so I’m assuming I charge the consulting firm 13% HST and then they charge the client. Isn’t this double provincial tax though?
Hi Laurie,
Charge 13% to your Ontario client. Your Ontario client (if they are a GST/HST registrant) can claim a refund, input tax credit, for the HST paid to you. This is not a case of double taxation.
Hello Allan,
Thanks for the great article. I am an IT consultant. I have a numbered Ontario Corp.
My current assignment is in Saskatchewan, my contract is with an Ontario Corp and my invoices are raised to them.
My question is should I be collecting GST + PST(SK) or HST in ON?
Thanks in advance,
Jose
Hi Jose,
Since the billing address of your Ontario customer is in Ontario, charge 13% HST on the invoice amount.
Hi Madan,
I own a small business of selling loose diamonds to jewellers. I am from Ontario and I have to sell one small stone to customer in British Columbia. I called client, he said I have to charge only 5% on invoice. Some people are saying it is 5%+7% and some of them prefer 5% only,
Can you advise urgently what is the correct one? Its my first time invoicing to british columbia
Hi Sam,
Charge 5% GST on the sale of the Diamond being delivered to your customer in BC.
We are an Ontario company, hired by another Ontario company to provide cabling in a Quebec company.
What taxes do I charge?
Hi Tammy,
If you are billing your Ontario customer, then charge 13% HST.
Hi, I have a small e-commerce site in Ontario which sells goods across Canada and we are approaching the 30k threshold. What tax do we charge to other provinces?
Hi Frank,
For non-harmonized provinces, charge the federal GST. For harmonized provinces, charge the combined HST. The rate that applies depends on the destination province (i.e. where the goods are delivered).
we hired a Consultant from BC and he purchased some books for us and came to Niagara by flight , when he billed he charged
Consultation charges
+Books actual invoice (including tax)
+Flight ticket acual (including tax)
then he charged GST 13% on everything, is this correct ?
Hi Simon,
Yes, the rate should be 13% since the goods were delivered to you in Ontario and the service address is also in Ontario.
Hi,
If I am shipping product to Nova Scotia but billing to Ontario, do I charge the Nova Scotia taxes?
Thank you
Charge 15% HST (Nova Scotia sales tax rate), because the goods are shipped to Nova Scotia.
If I have a company in BC and am purchasing advertising space with an Ontario company for their e-newsletter, would I pay BC (GST) or ON (HST)?
Hi Tryon, Pay BC GST.
Hi there,
I’m a self employed consultant, I live and work remotely from Newfoundland, my total sales are over 30,000$. I have a client in Quebec which is a business. do I need to bill them GST only on my invoices? or GST + QST?
for reference, I never been to Quebec before, and all my work is done remotely from newfoundland as a consultant. I’m not registered for QST.
Please help, thank you.
Hi Ibrahim,
Charge them GST only.
Hello,
I work for an insurance company in BC. We have agreements with property managers in every other province who refer us tenants and charge us a referral fee. What should be the tax rate on those referral fees?
Hi Dennis,
The managers who receive a referral fee from you should send an invoice to you and charge GST (5%) on top of the invoice amount.