Canadian Gst And Pst Tax Reports


Types of indirect taxes (VAT/GST and other indirect taxes). The three different tax models used in Canada are GST, HST, and PST. The names in each time zone change along with Daylight Saving Time. Eastern Standard Time becomes Eastern Daylight Time , and so forth.On the creation page, after entering the relevant details, select the Non Taxable option. Under the Tax & Payment Details section, select the Tax Exempt option against Tax Preference. For the Tax Rate, select the appropriate tax from the drop down which has already been created.

  • Generally, the seller of the goods and services remits both the federal and province taxes to the tax authorities.
  • The tax amount will not be shown in tax related reports of the integrated Zoho Books organization and instead will be recorded as an expense.
  • Enter the name of the tax group and select the taxes that needs to be added to the group.
  • Janet Berry-Johnson is a CPA with 10 years of experience in public accounting and writes about income taxes and small business accounting.

In general, GST, HST, and PST are not charged to Status Indians, Indian bands, or band entities for goods or services sold on reserve lands. The same applies to goods or services purchased off-reserve but delivered to a reserve.

How And Where To Register

A non-resident company may be required to give and maintain security with the Canada Revenue Agency in some circumstances. Generally, a non-resident company with no permanent establishment in Canada that applies voluntarily or is required to register must provide such security.If you are doing business in these provinces, you only need to collect one type of tax. Each province established its own percentage for PST collection and harmonized it with the GST when it joined the HST program. So the exact amount of HST could differ, depending on which of the five provinces a business operates.For provinces that split GST from PST a “No PST” checkbox will appear. Click to select it if the seller is in a different province from the buyer. If the seller is in the same province as the buyer, both GST and PST are normally charged so you should leave the “No PST” box deselected. Ontario, Newfoundland, New Brunswick and Nova Scotia use the combined HST, which is charged regardless of the Canadian buyer’s province.The HST is in effect in Ontario, New Brunswick, Newfoundland and Labrador, Nova Scotia and Prince Edward Island. Dealing with sales tax is an inherent part of running a small business. Get the basics down so you can focus on delivering top-notch experiences to your customers without worrying about surprise tax bills later on. We spell out the essentials to help you understand what taxes you need to charge province-by-province, and how to remit them. What qualifies PST/RST/QST-exempt or zero-rated can vary between provinces.Generally, the federal goods and services tax applies to taxable goods and services supplied in Canada. The harmonized sales tax is a blended federal/provincial sales tax that includes a 5 percent federal component and a provincial component of 8 percent or 10 percent. HST applies in the provinces of Ontario, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland and Labrador. The province of Québec applies its own value added tax, the Québec sales tax . The provinces of British Columbia, Saskatchewan and Manitoba levy provincial sales taxes , also known as retail sales taxes, in their respective jurisdictions. But in the rest of the country, the provincial sales tax situation is more complicated.

Canadian Gst And Pst Tax Reports

The Canadian GST is modeled after European value added taxes . For more information about VAT, see the chapter Chapter 1, “Value Added Taxes .”. What differentiates GST from most other countries using VAT is the inclusion of Provincial Sales Tax in the total calculation. Using the Self Assessment Taxes option you can print the self assessment taxes as positive amounts instead of negative amounts as found in the Tax Detail file .The amount of security may vary between CAD5,000 and CAD1 million. Yes, various other indirect taxes apply in Canada, including fuel taxes, tobacco taxes, alcohol taxes, insurance premium taxes and environmental levies. Small businesses operating in Canada are required to collect sales tax. It’s one of the responsibilities you have as a business owner. HST is the combination of a province’s sales tax and the GST. Ontario, Nova Scotia, New Brunswick, PEI, and Newfoundland and Labrador use the HST model.Based on your revenues, you will need to report and remit tax monthly, quarterly or yearly. You don’t need to collect sales tax from international customers, as long as the goods or services are delivered to an address outside of Canada. The seller of the goods and services calculates and remits both the GST and PST to the tax authorities. The calculations apply when PST is based on the pre-GST value and when PST is based on the value after GST has been added . In most cases, the seller of the goods and services calculates and remits both the GST and PST to the tax authorities. In a few cases, the seller calculates and remits only the GST. The purchaser of the goods and services must remit the PST.To qualify, your business’s worldwide yearly revenue needs to fall below $30,000. When it comes to sales tax, the CRA measures your “year” as the last four quarters. As soon as you surpass the $30,000 mark, you’re no longer a small supplier, starting in that calendar quarter. Critics claim that the HST shifts the tax burden from businesses to consumers.


Provincial sales taxes are charged on retail goods and services, whether you operate a traditional retail business or not. A provincial sales tax is imposed on consumers of goods and particular services in many Canadian provinces. Several provinces have agreed to integrate their provincial sales taxes with the federal Goods and Services Tax , charging a single Harmonized Sales Tax instead. The concept behind the HST was to streamline the recording and collection of federal and provincial sales taxes by combining them into a single, uniform levy across Canada. The provincial sales tax rate differs from province to province and is normally charged on the selling price of the item before the GST is applied. An operator of a business in any of the provinces that has a PST must charge, collect, and remit the provincial sales tax on applicable goods and services. Unlike with the GST and HST, there is nosmall supplierexception for provincial sales tax except for in British Columbia.

canadian gst and pst tax reports

It can apply when PST is based on the pre-GST value and when PST is based on the value after GST has been added . PST can be remitted to the tax authorities by either the seller or the buyer. Although the PST is always calculated after the GST is calculated, in some cases it is based on the pre-GST value and in other cases it is based on the value after GST has been added .

Sales Orders & Invoices

You can also create a new tax by selecting +New Tax in the drop down. Under the Tax & Payment Details section, select the Taxable option against Tax Preference. Select the New Tax Exemption option from the +New Tax drop-down, placed on the top-right of the module. Select the New Tax Agency option from the +New Tax drop-down, placed on the top-right of the module. Select the New Tax Group option from the +New Tax drop-down, placed on the top-right of the module. Ontario implemented the HST in 2010, joining Nova Scotia, New Brunswick, and Newfoundland and Labrador where HSTs had already been in effect for some time. British Columbia briefly implemented an HST but returned to a PST regime after rejecting the HST in a provincial referendum.Corporations, sole proprietorships, and partnerships qualify if they can meet this rule. Businesses in most provinces must collect the PST, GST, HST, or some combination of these taxes. Global Indirect Tax ServicesKPMG’s Global Indirect Tax Services helps clients deliver real value to their business from indirect tax. Yes, under the GST/HST and QST systems, certain supplies qualify as zero-rated supplies and are taxed at a 0 percent rate, such as basic groceries. No, however, Canada provides a zero-rate of GST/ HST to many qualifying goods and services, which give rise to a right for the supplier to recover or deduct input tax. Common examples are qualifying exported goods and services, basic groceries and prescription medicine. MillionMonthlyOver CAD6 millionDifferent rules apply for PST purposes and vary by province.The province of Quebec has adopted new QST rules for non-resident suppliers, including a new QST registration obligations for many non-residents. The province of Quebec has adopted new QST rules for non-resident suppliers, including new QST registration obligations for many non-residents. No, GST/HST grouping for registration purposes is generally not permitted. However, special rules may apply for certain qualifying investment plans. A non-resident company may also be required to fill out a GST/HST questionnaire for non-residents and may want to file a request to keep books and records outside of Canada.In spite of attempts by the Canadian government to convince provinces to combine their PST with the federal goods and services tax to create a harmonized sales tax , not all provinces have done so. Charging, recording, and remitting provincial sales taxes isn’t that difficult a task once you know what the rules are and how to apply them to your business. Be sure you know all the steps required for registering, collecting, and filing your sales tax, so you’re ready to run your business. Sales taxes on new or significantly renovated housing used as a primary residence may be eligible to have a portion of charged federal and provincial sales taxes rebated. New homes valued up to $450,000 may be eligible for a 36% rebate on GST charged up to a maximum of $6,300. Provincial sales tax rebate programs on new housing are offered in Ontario, British Columbia, Nova Scotia, Saskatchewan, and Quebec . Provincial sales taxes can also vary within provinces depending on what product or service is being taxed.Generally, businesses must retain books and records for six years after the end of the year to which they relate. However, certain assessments can be issued for up to seven years and may require keeping the related books and records longer. However, the invoice must, either alone or in combination with another eligible document or documents, contain the information required for the recipient to be able to claim the input tax credit. Businesses are required to follow specific requirements for electronic records.

1 About Canadian Gst And Pst Tax Reports

Under the GST/HST rules, books and records must generally be stored in Canada. However, non-residents may request authorization to keep records outside of Canada, subject to certain conditions. Yes, businesses must comply with a number of tax disclosure requirements.The CRA later allocates the provincial portion of the HST to the respective province’s government. Businesses that are located in one province but sell taxable services or products to consumers in other provinces should generally charge the sales tax that’s applicable in the consumer’s province. Check with the Canada Revenue Agency to be sure if you frequently make sales to outside provinces. Goods and Services Tax /Harmonized Sales Tax , a value-added tax levied by the federal government. The HST includes the provincial portion of the sales tax but is administered by the Canada Revenue Agency and is applied under the same legislation as the GST.