How it's calculated
Sales tax in Canada depends on the province or territory where the sale is made (the place of supply). Some provinces combine their sales tax with the federal GST into one harmonized sales tax (HST); others charge GST and a separate provincial sales tax; the territories and Alberta charge GST only.Canada Revenue Agency
- GST only (5%): Alberta, the Northwest Territories, Nunavut and Yukon.
- HST: Ontario 13%; Nova Scotia 14%; New Brunswick, Newfoundland and Labrador and Prince Edward Island 15%.
- GST plus provincial tax: British Columbia PST 7%,Government of British Columbia Manitoba RST 7%,Manitoba Finance Saskatchewan PST 6%Government of Saskatchewan and Quebec QST 9.975%.Revenu Québec
The formula
Adding tax to a price before tax:
- GST = price × GST rate (or HST = price × HST rate).
- PST, RST or QST = price × provincial rate. Each tax is charged on the price before tax, so they are not compounded. Quebec's QST is calculated on the selling price excluding the GST.
- Total = price + GST + PST (or price + HST). Each tax is rounded to the cent.
Removing tax from a tax-included total: price before tax = total ÷ (1 + combined rate), and the tax is the difference.
Worked example
$100 before tax costs $113.00 in Ontario, $114.98 in Quebec and $105.00 in Alberta.
| Line | Amount |
|---|---|
| Price before tax | $100 |
| GST (5%) | $5 |
| PST (7%) | $7 |
| Total sales tax | $12 |
| Price including tax | $112 |
Going the other way, a $113 receipt in Ontario is $100.00 before HST.
Assumptions and limitations
- General rates only. Zero-rated supplies such as basic groceries are taxed at 0% everywhere, some goods and services are exempt, and provinces with their own sales tax set other rates or exemptions for some items. Check the rules for what you are buying or selling.
- Place of supply. The rate is the one where the supply is made, usually where goods are delivered or a service is performed, not where the seller is based.
- Rounding. Each tax is rounded to the cent on the total shown; a receipt that rounds item by item can differ by a cent or two.