Who Has to Charge PST, GST, and Provincial Sales Tax
If you don't have to charge GST, do you have to charge PST?
Yes, if your business resides in a province that has a provincial sales tax, or retail sales tax (RST) as it is also called, you will have to charge, collect and remit PST unless you are selling a product or service that is PST exempt, in most cases.
Which Provinces Charge a Provincial Sales Tax
Currently, five provinces (Ontario, New Brunswick, Nova Scotia, Newfoundland & Labrador, Prince Edward Island) no longer have a provincial sales tax - they have merged their provincial sales tax with the federal GST and now charge a single Harmonized Sales Tax (HST).
Provinces that still have a separate provincial sales tax are Manitoba, Saskatchewan, British Columbia, and Quebec. In Manitoba, the provincial sales tax is referred to as the RST, in Quebec as the Quebec Sales Tax (QST). In these provinces, the GST and PST/RST/QST are charged as separate line items on invoices.
Small Supplier Exemptions From GST and PST/RST/QST
Federally, if your business meets the Canada Revenue Agency (CRA) definition of a small supplier (total annual taxable revenue before expenses is less than $30,000), you do not have to collect and remit GST/HST. At the provincial level, the rules for small supplier exemptions vary from province to province:
- Quebec has a small supplier exemption for the Quebec Sales Tax similar to the federal version (if annual revenue is less than $30,000 you do not have to register to collect QST).
- Saskatchewan does not have a small supplier exemption - you must register for, charge and remit provincial sales tax on all non-exempt goods and services.
- Manitoba businesses with annual taxable sales over $10,000 must register for, charge and remit the retail sales tax (RST) on all non-exempt goods and services. See Information For Vendors for more information.
- British Columbia has a Small Seller exemption.
Exemptions for Particular Goods and Services
Many items are classed as exempt from GST/HST, meaning the GST/HST is not added to the selling price. Generally, goods such as basic groceries, prescription drugs, and healthcare services are exempt from both federal and provincial taxes, but some goods and services which are exempt from the federal GST/HST are not exempt at the provincial level and therefore subject to PST/RST/QST. Refer to the exemption list for your province for details:
- Manitoba - generally, RST must be charged on the sales of all tangible property, unless exempt. The Government of Manitoba defines "tangible property" as "anything that can be seen, weighed, measured, felt, or touched; that is, anything that we can perceive with our senses." For a list of RST exempt items in Manitoba, see the Summary of Taxable and Exempt Goods and Services Bulletin.
- Saskatchewan also requires that PST is charged on the sales of all tangible property, unless exempt. The Government of Saskatchewan uses the same definition of "tangible property" as does Manitoba. See the Government of Saskatchewan Provincial Sales Tax website for more info including a list of PST-exempt items.
- British Columbia has exemptions for various items, including (for example) the sales and rentals of real property, basic groceries, books and magazines, children's clothing, and prescription drugs. For a complete list see the Tax Exemptions on the Government of B.C. Website.
- Quebec also exempts certain items from provincial tax, refer to Exempt Sales or Supplies on Revenue Quebec's website for more details.