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Canada’s e-commerce market is rapidly growing, with sales reaching 3.14 billion USD and projected 104 billion USD by 2029, led by fashion, leisure, and electronics, attracting U.S. businesses.
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Canada applies GST nationwide, with some provinces adding PST or using Harmonized Sales Tax (HST). Rates vary between 5% (GST-only provinces) and up to 15% (HST provinces).
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Foreign businesses must register for GST/HST if Canadian revenues exceed 30,000 CAD annually, especially when selling taxable goods stored, shipped, or delivered in Canada, including through fulfillment warehouses.
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Registration requires obtaining a Business Number (BN) and opening a GST/HST account. Filing frequency depends on revenue: annually, quarterly, or monthly. Nil returns are mandatory if no tax collected.
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Non-compliance risks penalties and business disruptions. Despite structural similarities to U.S. sales tax, Canadian tax rules remain complex, requiring vigilance and possible professional assistance to ensure smooth cross-border sales operations.
Source: www.taxconnex.com
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