Sales Tax Rates in Canada varies by province and territory, which can be a point of confusion for businesses and consumers alike. Understanding these rates is crucial for accurate pricing, budgeting, and compliance with tax regulations. Here’s an overview of the current sales tax rates across Canada’s provinces and territories as of 2023.
Types of Sales Tax Rate in Canada Province and Territory Wise:
There are basically two tiers of sales tax in Canada: federal and provincial. It also categories by Provincial Sales Tax (PST), Harmonized Sales Tax (HST), Retail Sales Tax (RST), Quebec Sales Tax (QST), Goods and Sales Tax (GST)and HST. Every incorporated Company must know the terms & Component to adhere to Tax Rules.
Federal Sales Tax Rate: GST
Goods and Services Tax (GST): This is a federal tax of 5% applied across Canada on most goods and services.
Provincial Sales Taxes:PST
British Columbia: PST here is 7%, applied to the sale price of most goods and some services.
Saskatchewan: The PST rate is 6%, applicable to most goods and certain services.
Manitoba: Manitoba charges a PST of 7% on most goods and services.
Quebec: Referred to as QST (Quebec Sales Tax), the rate is 9.975%.
Retail Sales Tax (RST):
RST stands for Retail Sales Tax. Manitoba is a province that uses the term RST for its provincial sales tax. The rate and the rules for RST in Manitoba might be different from the PST in other provinces.
Quebec Sales Tax (QST):
It is a tax charged in the province of Quebec. the QST rate is 9.975%. This is added to the cost of most goods and services sold or provided in Quebec.
Provinces with HST
Ontario: The HST rate is 13%, combining 5% GST and 8% provincial rate.
New Brunswick, Newfoundland and Labrador, Nova Scotia, Prince Edward Island: These provinces have an HST rate of 15%, incorporating the 5% GST and a 10% provincial rate.
Territories and Alberta: Alberta, Northwest Territories, Nunavut, and Yukon: These regions only apply the 5% GST and do not have additional PST or HST.
Sales Tax Rates by province and Territories:
To make it easy we have listed all types of Tax rates in the following table:
| Province | Type | PST | GST | HST | Combined Tax Rate |
| Alberta | GST | na | 5% | 5% | |
| British Columbia | GST + PST | 7% | 5% | 12% | |
| Manitoba | GST + PST | 7% | 5% | 12% | |
| New Brunswick | HST | 15% | 15% | ||
| Newfoundland and Labrador | HST | 15% | 15% | ||
| Northwest Territories | GST | 5% | 5% | ||
| Nova Scotia | HST | 15% | 15% | ||
| Nunavut | GST | 5% | 5% | ||
| Ontario | HST | 13% | 13% | ||
| Prince Edward Island | HST | 15% | 15% | ||
| Quebec | GST + QST | 9.98% | 5% | 14.98% | |
| Saskatchewan | GST + PST | 6% | 5% | 11% | |
| Yukon | GST | 5% | 5% |
Register Your Sales Tax Account
Registering for a sales tax account in Canada is an important step for businesses to comply with tax regulations. The process can vary slightly depending on whether you’re registering for GST/HST, PST, or QST. Here’s a general guide:
Determine Your Need to Register
GST/HST: If your business has a taxable revenue over a certain threshold (typically $30,000 in a 12-month period), registration for GST/HST is mandatory.
PST and QST: The requirements for PST (like in British Columbia, Saskatchewan, or Manitoba) and QST (in Quebec) vary. Generally, if you sell or provide taxable goods or services in these provinces, you need to register.
Collect Necessary Information
Before registering, make sure you have all required information ready, such as:
- Business name and contact information
- Business number (BN) if already registered for GST/HST
- Financial information about your business
- Information about the owners or directors
Choose the Registration Method
- Online: The easiest way is through the Canada Revenue Agency (CRA) website for GST/HST. For PST and QST, visit the respective provincial revenue websites.
- By Mail or Fax: You can download the registration form from the CRA or provincial website, fill it out, and send it.
- By Phone: Some jurisdictions allow registration by phone.
Register for GST/HST
You may contact CRA to register your Tax account that may be time consuming and hassle for you. That’s why RegiCorp offer the service to Register CRA tax account
Register for PST/QST
For PST and QST you contact respective province’s revenue agency (e.g., eTaxBC for British Columbia, eTax Saskatchewan, Manitoba Taxation Division). But why RegiCorp offer the service to Register PST/QST account completely online. account
Obtain Your Sales Tax Account Number
Once registered, you’ll receive a sales tax account number. This is crucial for filing and remitting the sales tax you collect.
Stay Informed & Keep Your Information Updated
Keep track of your sales and the tax you collect. Be aware of the deadlines for filing and remitting the sales taxes. If your business information changes, make sure to update your sales tax account accordingly.
Filing and paying sales tax to CRA and Provincial Tax account
Filing and paying sales tax is a crucial part of running a business in Canada. This process involves declaring the amount of sales tax (like GST/HST, PST, or QST) you’ve collected from customers and remitting it to the appropriate tax authority. Here’s a simplified guide to help you understand this process:
Understand Your Tax Obligations
GST/HST: If you are registered for GST/HST, you need to file a GST/HST return regularly.
PST/QST: If operating in provinces with PST (like British Columbia, Saskatchewan, Manitoba) or QST (in Quebec), you must file separate returns for these taxes.
Keep Accurate Records: Maintain detailed records of all sales, the tax collected, and tax-exempt sales.
Expense Records: Keep track of your business purchases and the input tax credits (ITCs) you are entitled to claim.
Know Your Filing Frequency: The frequency of your tax filings depends on your business size and tax type. It can be:
- Monthly
- Quarterly, or
- Annualy
The CRA or your provincial tax authority will notify you of your filing frequency.
Complete Your Tax Return
GST/HST Returns: Can be filed online through the Canada Revenue Agency’s My Business Account, by mail, or via third-party software.
PST/QST Returns: Filed through the respective provincial government’s online portal or other specified methods.
Calculate the Amount Owing: Deduct the total amount of ITCs (for GST/HST) from the total amount of tax collected from your customers. The difference is what you owe.
For PST/QST, calculate the total amount collected less any allowed deductions.
Pay Your Sales Tax
Online: Through your bank’s online banking service, CRA’s My Payment service, or the respective provincial tax authority’s website.
By Mail: Sending a cheque to the CRA or provincial tax authority.
In Person: At your bank or a CRA office for GST/HST.
Adhere to Deadline: Be aware of the due dates for filing and payment. Late filing or payment can result in penalties and interest.
Input Tax Credits (ITCs): For GST/HST, you can claim ITCs for the tax you paid on business expenses that relate to your sales.
Regular Audit & Stay updated on any changes in tax laws: Be prepared for possible audits by keeping comprehensive and organized records.