Merchants selling in Canada can breathe a sigh of relief. As of April 2022, Printify is introducing tax charges on all sales made in Canada. This means that all items printed and shipped within Canada will automatically be subject to local sales taxes, making it easier for your accounting.
Tax rates in Canada differ depending on your shipment’s destination, since each province uses its own tax calculation model. Now, all of your Printify invoices will include a clear summary of Canadian tax charges, so you can use this information for your tax returns.
This article gives a summary of the different types of taxes levied in Canada, explains how they are calculated, and provides information on available tax exemptions.
Please note that this article has been prepared for informational purposes. We recommend consulting tax and accounting professionals if you have any specific legal matters.
Table of Contents
- Types of Sales Taxes in Canada
- How Do Canadian Sales Taxes Compare to the US Sales Tax and VAT in Europe?
- How Are Canadian Sales Taxes Calculated and Charged?
- Canada Invoice Summary
- How Can Merchants Get An Exemption?
- Where Can I Get Tax Advice?
Types of Sales Taxes in Canada
There are two types of sales taxes in Canada. One is levied by the provinces, and the other is charged by the federal government.
These can be broken down into four separate sales taxes, and that’s how they appear in our Canadian invoices. There’s the Goods and Services Tax (GST), the Harmonized Sales Tax (HST), the Provincial Sales Tax (PST), and the Quebec Sales Tax (QST).
Some provinces charge only the federal tax (GST/HST), while others have specific tax rates established on the provincial level.
Goods and Services Tax (GST)
The Goods and Services Tax applies to all sales in all provinces of Canada.
It can show up in two different forms, depending on the province your shipment is headed to:
- An individual tax, charged at a rate of 5%
- A portion of a province-specific Harmonized Sales Tax
Alberta is the only province that charges solely the GST without any additional local taxes. The territories of Yukon, Northwest Territories, and Nunavut have no territorial sales taxes – only the GST is collected there.
Harmonized Sales Tax (HST)
The HST is a combination of the Goods and Services Tax and the provincial portion of the sales tax, and is applied under the same legislation as the GST.
This tax applies to all orders shipped to Ontario, New Brunswick, Newfoundland and Labrador, Nova Scotia, and Prince Edward Island.
Provincial Sales Tax (PST)
The Provincial Sales Tax is a province-specific tax collected in addition to the GST. It’s applied to all orders shipped to British Columbia, Manitoba, and Saskatchewan.
Quebec Sales Tax (QST)
The Quebec Sales Tax is a type of PST applied to all orders shipped to the province of Quebec. Out of all provincial taxes, the QST is the only value-added tax.
How Do Canadian Sales Taxes Compare to the US Sales Tax and VAT in Europe?
Canada uses a mix of European-style value-added taxes and US-style sales taxes.
The GST and HST levied at the federal level and the QST charged by Quebec are all VAT-type taxes. They apply to most sales of goods and services regardless of whether the recipient is registered as a taxable business or not. Tax-registered businesses can reclaim these three types of taxes if the purchased goods are used for resale or other business purposes.
In contrast, the PST levied by British Columbia, Manitoba, and Saskatchewan is similar to the US sales tax and is paid by end consumers. Local businesses purchasing goods are exempt from PST provided they submit proof of their PST registration to Printify.
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How Are Canadian Sales Taxes Calculated and Charged?
Starting April 2022, Printify will automatically include tax on all Canadian orders, based on Canada’s tax policies. In Canada, sales taxes are charged on both federal and provincial levels. The sales tax will differ depending on the province your product is shipped to.
For example, if your product is shipped to British Columbia, it will be charged GST in the amount of 5% and PST in the amount of 7%. If your product’s price is $20, you’ll be charged $1 in GST (5%) and $1.40 in PST (7%), with the total sum including taxes amounting to $22.40.
Canadian Tax Rates
Your invoice summary will display the tax rates applicable depending on the province where the product has been shipped.
Canadian provinces charge either only the GST or the GST combined with a Provincial Sales Tax (PST). In provinces with the Harmonized Sales Tax (HST), the provincial portion of the sales tax has already been added to the combined rate.
| Province | Type | Combined Rate | PST | GST |
|---|---|---|---|---|
| Ontario | HST | 13% | – | – |
| Nova Scotia | HST | 15% | – | – | Prince Edward Island | HST | 15% | – | – |
| New Brunswick | HST | 15% | – | – |
| Newfoundland | HST | 15% | – | – |
| Quebec | GST + QST | 14.98% | 9.98% | 5% |
| British Columbia | GST + PST | 12% | 7% | 5% |
| Manitoba | GST + PST | 12% | 7% | 5% |
| Saskatchewan | GST + PST | 11% | 6% | 5% |
| Northwest Territories | GST | 5% | 0% | 5% |
| Alberta | GST | 5% | 0% | 5% |
| Yukon | GST | 5% | 0% | 5% |
| Ontario | |
|---|---|
| Type | HST |
| Combined Rate | 13% |
| PST | – |
| GST | – |
| Nova Scotia | |
| Type | HST |
| Combined Rate | 15% |
| PST | – |
| GST | – |
| Prince Edward Island | |
| Type | HST |
| Combined Rate | 15% |
| PST | – |
| GST | – |
| New Brunswick | |
| Type | HST |
| Combined Rate | 15% |
| PST | – |
| GST | – |
| Newfoundland | |
| Type | HST |
| Combined Rate | 15% |
| PST | – |
| GST | – |
| Quebec | |
| Type | GST + QST |
| Combined Rate | 14.98% |
| PST | 9.98% |
| GST | 5% |
| British Columbia | |
| Type | GST + PST |
| Combined Rate | 12% |
| PST | 7% |
| GST | 5% |
| Manitoba | |
| Type | GST + PST |
| Combined Rate | 12% |
| PST | 7% |
| GST | 5% |
| Saskatchewan | |
| Type | GST + PST |
| Combined Rate | 11% |
| PST | 6% |
| GST | 5% |
| Northwest Territories | |
| Type | GST |
| Combined Rate | 5% |
| PST | 0% |
| GST | 5% |
| Alberta | |
| Type | GST |
| Combined Rate | 5% |
| PST | 0% |
| GST | 5% |
| Yukon | |
| Type | GST |
| Combined Rate | 5% |
| PST | 0% |
| GST | 5% |
Canada Invoice Summary
You can view your invoices by going to the Payments section of your profile and selecting Invoices. You’ll see the Canadian flag on your Canadian invoices. There are separate invoices for sales made within Canada and for imports into Canada. We currently offer monthly invoice summaries.
Like all other summaries, the Canada invoice summary consists of a summary page and a details page. You can find more information about the invoice summary in our help center article.
How Can Merchants Get An Exemption?
Printify can allow an exemption from the Provincial Sales Tax for merchants in British Columbia, Manitoba, and Saskatchewan. If you’re a registered taxpayer in one of these provinces, you can give us your tax registration details and receive an exemption. Learn more in the article on how to become exempt from Provincial Sales Tax.
When it comes to HST, GST, and QST, these are VAT-type taxes, and merchants cannot be exempt. You can reclaim these taxes via tax returns if you’re a registered taxpayer.
Where Can I Get Tax Advice?
Keep in mind that Printify does not provide legal, tax, or compliance advice. If you’re not sure whether you need to register for any taxes in Canada, please consult a professional tax advisor for the best solution for you and your business.
Disclaimer: We strongly recommend you consult a tax specialist or CPA to get advice on sales tax and regulations.
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