Canadian Sales Tax on U.S. Sellers: GST/HST and PST Rules, Nexus Equivalent, Exceptions, Cash Flow Improvement (Refund) Opportunities and Planning Considerations

Note: CLE credit is not offered on this program

A live 110-minute CPE webinar with interactive Q&A


Tuesday, November 10, 2020

1:00pm-2:50pm EST, 10:00am-11:50am PST

Early Registration Discount Deadline, Friday, October 16, 2020

or call 1-800-926-7926

This webinar will provide tax professionals and advisers with guidance on the challenges of Canadian sales tax as applied to U.S.-based sellers. The panel will discuss Canada's Goods & Services Tax/Harmonized Sales Tax (GST/HST), Quebec Sales Tax (QST) and provincial sales tax (PST), applicable rules, registration requirements for non-residents, small supplier exception, common errors (including refundable overpaid taxes that can help improve cash flow) and other critical items for U.S.-based sellers.

Description

With more than $480 billion of trade to Canada, a large portion of purchases by Canadians are from U.S. vendors and almost all of these sales have tax implications. Tax professionals need a complete understanding of the Canadian sales tax regime to avoid any unintended liabilities for U.S.-based sellers.

U.S.-based businesses providing property or services in Canada may need to register and obtain a Canadian Business Number. Canada applies sales taxes on the sale of certain real/tangible/intangible property as well as services based on “place of supply” rules that determine the province of supply. The GST/HST is the federal sales tax that applies at one rate or another on supplies made throughout Canada with rates that range between 5% and 15%. Some provinces also impose a PST in addition to the base 5% GST, which may require businesses to register and remit the PST separately for a given province.

Under certain circumstances, a U.S.-based business may not be required to transact Canadian sales tax. For instance, some may not be viewed as carrying on business in Canada (a nexus test equivalent), others may qualify for the small supplier exception or may be engaged in providing certain types of property and services that are zero-rated or exempt from Canadian sales tax. Tax professionals must recognize crucial issues under applicable tax laws and registration requirements that can minimize overpayment of tax and even provide lucrative cash flow improvements in the form of rebates and input tax credits.

Listen as our panel discusses Canada's GST/HST, QST and PST, as well as compliance challenges for U.S.-based sellers.

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Outline

  1. Canada vs. U.S. tax system
  2. GST/HST, QST and PST overview
  3. Carrying on business requirements
  4. Common errors/audit issues and opportunities for U.S.-based sellers
  5. Compliance challenges and best practices/tips and tricks for U.S.-based businesses

Benefits

The panel will discuss these and other key issues:

  • How does Canada's tax system differ from the United States' system?
  • What are the GST/HST, QST and PST taxes? How are they applied to sales by U.S.-based companies?
  • What are the nexus standard equivalents (referred to as “carrying on business in Canada”) for non-residents of Canada?
  • What are the Canadian sales tax registration requirements?
  • What exceptions or exemptions are available?
  • What are the most common errors that trip up non-residents that are selling into Canada that can trigger audits and examinations by the tax authorities?
  • How should you setup your general ledger to account for the taxes and what compliance challenges do many non-residents encounter?

Faculty

Morcombe, Brian
Brian Morcombe, CPA, CMA

Partner, Indirect Tax
BDO Canada

Mr. Morcombe has more than 20 years’ experience providing GST/HST, QST and PST solutions to non-resident and...  |  Read More

Nagorski, Anthony
Anthony Nagorski, J.D.
State & Local Tax Senior Manager
BDO USA

Mr. Nagorski has nearly 10 years of sales and use tax experience within State and Local Tax, covering all industries...  |  Read More

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