How vat / sales tax works in Canada
Canada layers consumption tax: 5% federal GST everywhere, harmonised HST of 13% to 15% in Ontario and the Atlantic provinces, and separate provincial PST or Quebec QST on top of GST elsewhere.
Registrants charge the applicable combined tax, claim input tax credits, and file GST or HST returns, while zero-rated exports and basic groceries preserve credits and exempt supplies do not.
Small suppliers under CAD 30,000 of taxable sales in four quarters can stay unregistered, and non-resident digital and goods vendors face dedicated registration streams.
Tax rates at a glance
- Federal GST
- 5%
- Ontario HST
- 13%
- Atlantic HST
- 15%
- Quebec QST
- 9.975%
- BC and Saskatchewan PST
- 7% / 6%
- Small supplier threshold
- CAD 30,000
Who benefits most
These profiles tend to benefit most when the rules match their real residence, payroll and business setup.
E-commerce sellersSaaS foundersFreelancersExpatsCross-border traders
Watch out for
- Place-of-supply rules pick the province, not the seller: the delivery address decides between 5%, 13%, 15%, or GST-plus-PST stacks.
- Quebec QST applies on the GST-inclusive price, so the combined Quebec burden compounds rather than simply adding two headline rates.
- PST provinces run separate registrations, returns, and exemption certificates outside the CRA system, which doubles admin for national sellers.
- Digital and marketplace regimes pull non-resident vendors into GST or HST collection from the first dollar of qualifying Canadian sales.
Frequently asked questions
What is the sales tax rate in Canada?
It depends on the province. Federal GST is 5% everywhere, HST reaches 13% in Ontario and 15% in Atlantic provinces, while BC, Saskatchewan, Manitoba, and Quebec add separate PST or QST.
When must a Canadian business register for GST or HST?
Past CAD 30,000 of taxable sales in four calendar quarters as a small supplier. Taxis, ride-shares, and non-resident digital vendors face registration without that shelter.
How does Quebec sales tax work?
Quebec charges 5% GST plus 9.975% QST calculated on the GST-inclusive price. QST registration and filing run through Revenu Quebec alongside the federal system.