Indirect tax ebook - Canada

Registration

Any person carrying on business in Canada, including a non-resident is required to become registered for GST/HST if their worldwide sales exceed the registration threshold of $30,000 annually. A non-resident does not need to have a permanent establishment to be required to register. Once a person is carrying on business in Canada and makes a taxable supply in Canada, they are required to register provided their worldwide revenue has exceeded $30,000. A slightly higher threshold of $50,000 is available for public sector bodies such as charities and non-for-profit organizations.

In certain cases, voluntary registration may be permitted for residents or non-residents who are not required to become registered but wish to collect tax and recover the tax they pay. Only a person registered for the GST/HST can claim a refund of the tax they pay unless the tax has been charged to them in error or the person is entitled to a specific rebate.

Non-residents without a permanent establishment in Canada are required to post security with the taxing authority. The security is equal to 50% of the estimated net tax of the person with a minimum of $5,000 and a maximum of $1,000,000.

QST registration is similar to the GST/HST registration requirements for a business being carried on in the province of Quebec.

Registration in the other provinces depends on a number of factors. There is no revenue threshold to apply. Most provinces look to the presence and activities being carried on in the particular province to determine registration. British Columbia and Manitoba specifically require non-residents of the province to register if taxable sales are made and there is direct solicitation in their province.

• Introduction
• Scope
• Registration
• Tax rates
• Reporting & filing
• General tax application/Time of supply