GST/HST for cross-border sellers

Registration is not optional once you cross the threshold

A non-resident business supplying goods or digital services to Canadian consumers can be required to register for GST/HST even without a physical presence. The common trigger is exceeding CAD 30,000 in taxable supplies to Canadian recipients over twelve months.

Two regimes, not one

The simplified registration regime applies to non-residents supplying digital products and services to consumers. It collects tax but does not allow input tax credits.

The normal regime applies where the business is carrying on business in Canada. It requires more, but it allows recovery of GST/HST paid on inputs, including tax paid at the border on imported goods.

Choosing the simplified regime because it is easier can cost more than it saves when the business pays significant Canadian input tax.

Place of supply still governs the rate

HST provinces apply a combined rate; others apply 5 per cent GST plus a separate provincial tax that may not be recoverable. The rate follows the recipient's address, so the customer data you collect at checkout determines the rate you must charge.

Practical steps

1. Measure the twelve-month rolling total of taxable supplies to Canadian recipients.
2. Decide between simplified and normal registration based on expected input tax.
3. Collect and retain evidence of recipient location.
4. Set the filing frequency deliberately; annual filing with instalments suits low-volume sellers.