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Selling from Alberta into Provinces with Sales Taxes

In a province with a sales tax, a resident cannot escape the tax by purchasing a taxable good from out of province. The question is whether the out-of-province seller is expected to collect and remit the tax, or whether the resident is expected to self-assess and remit the tax.

The province levying the sales tax cannot impose a duty to register or collect tax on businesses that have no presence in their province. Generally, this is taken to mean a physical presence. However, some provinces examine a broader range of factors and require the business to collect and remit the tax if it is deemed to be “doing business” in the province. Factors that provinces may consider in making this determination include:

  • whether the business has a physical presence in the province;
  • the places where the contract, payments, and delivery are made;
  • whether the business actively solicits orders in the province;
  • whether agents act on behalf of the company in the province.

Some provinces focus more on physical presence (e.g., Saskatchewan ) while others have broader criteria (e.g., B.C. and Ontario ).

The HST charged by New Brunswick , Nova Scotia and Newfoundland is an exception to the above, because the HST is an add-on to the federal GST. The federal government can enforce collection of the HST without the seller having a presence in those provinces. In general, a seller in Canada must charge the additional HST on top of GST whenever it delivers goods to a recipient in an HST province, regardless of the degree of connection it has to that province.

The above information is not a substitute for direct advice from each province on whether it would expect the business to collect and remit sales tax. Each business should contact each province, first, to confirm that the product or service is taxable, and if so, to determine whether the province would expect the business or purchaser to collect and remit the tax.

Information and contact numbers for the provinces are given below.

British Columbia

Website: http://www.rev.go v.bc.ca/ctb (click on “Bulletins”)

Phone: Consumer Taxation Branch, 1-877-388-4440, (604) 660-4524

Saskatchewan

Website: http://www.gov.sk.ca/financ e/revenue/default.htm

Phone: Revenue Division, 1-800-667-6102, (306) 787-7768

Manitoba

Website: http://www.gov.mb.ca/finance/taxation/index.html

Phone: Taxation Division, (204) 945-5603

Ontario

Website: http://www.trd.fin.gov.on.ca

Phone: Contact: Retail Sales Tax Branch, 1-800-265-2587

Quebec

Website: http://www.mrq.gouv.qc.ca/eng/taxes/tvq_tps/index.asp

Phone: Ministry of Revenue, 1-800-567-4692, (514) 873-4692

HST provinces - New Brunswick, Nova Scotia, and Newfoundland

Website: http://www.ccra-adrc.gc.ca/menu/EmenuHDC.html

Phone: Canada Customs & Revenue Agency, 1-800-959-5525

P.E.I

Phone: (902) 368-4171

Appendix: Registration Requirements for Non-Resident Vendors

(Again, businesses should contact each province to ensure that the information below is accurate and up to date.)

B.C.

Who Must Register?

If you are located outside the province, you must register if you regularly:

  • solicit persons in British Columbia for orders to purchase tangible personal property
  • accept orders to purchase tangible personal property, if the orders to purchase originate from locations in British Columbia
  • sell tangible personal property to a person in British Columbia
  • cause tangible personal property to be delivered into British Columbia

Applications for registration as a vendor form FIN 418 (requires Adobe Acrobat Reader) are available from all Consumer Taxation Branch and Government Agents offices. For more information on who must register as a vendor or lessor, please refer to Consumer Taxation Branch Bulletin 044.

(Your Responsibilities as a Vendor, www.rev.gov.bc.ca/ctb/publications/brochures/vendor.htm)

Saskatchewan

I am a non-resident vendor making sales into the Province. Do I have to collect tax on my sales?

All persons making taxable sales in Saskatchewan should become licensed and collect the tax. Non-resident businesses should consider becoming licensed as a convenience to their customers. If non-resident businesses don't collect PST at the time of sale, their customers are required to self assess and remit the tax.

(Online Q&As, www.gov.sk.ca/finance/revenue/pst/questions.htm)

Vendor responsibilities

All businesses in Saskatchewan are required to register with the Department of Finance. Businesses that sell taxable goods and services in Saskatchewan are required to obtain a Vendor's Licence.

(Online vendor responsibilities, www.gov.sk.ca/finance/revenue/pst/collections.htm)

Legislation

“vendor” means any person who, within the province and in the course of his business or in the course of continuous or successive acts:

(i) sells or leases tangible personal property to a consumer or user at a retail sale in the province for purposes of consumption or use, and not for resale;

(ii) sells or leases taxable services to a user at a retail sale in the province for purposes of use and not for resale; or

(iii) sells tangible personal property to a consumer or user to be used by the consumer or user for the purpose of promotional distribution.

(9) Every person residing or ordinarily resident or carrying on business in Saskatchewan who brings into the province or who receives delivery in the province of tangible personal property for his own consumption or use, or for the consumption or use of other persons at his expense, or on behalf of or as agent for a principal who desires to acquire the property for consumption or use by the principal or other persons at his expense, shall immediately report the matter to the minister or his appointee and forward or produce to him the invoice, if any, in respect of the property and any other information required by him with respect to the property and shall pay the same tax in respect of the consumption or use of the property as would have been payable if the property had been purchased at retail in the province at the price that would have been paid in Saskatchewan if the tangible personal property had been purchased at retail in the province.

Manitoba

Should my business be registered for sales tax purposes?

Your business is required to be registered for sales tax purposes if:

• You are an out-of-province business having a presence in Manitoba and selling in Manitoba .

(Pamphlet, Do I need to register? www.gov.mb.ca/finance/taxation/bulletins.html#rstbulletins)

 

 




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