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Do You Need To Charge BC PST On Your Sales?

We had previously covered high-level guidance on GST/HST in this previous newsletter post.

Requirement to register for and collect BC PST can apply to businesses, whether they are based in BC or not. Here's a concise guide with the basics.

Businesses Located in BC

You are required to register, collect and remit BC PST if you do any of the following in the ordinary course of your business in BC:

• Sell taxable goods in BC - for e.g. general merchandise, alcohol, physical products, motor vehicles, and more.

• Lease taxable goods in BC - vehicles, tools, equipment, etc.

• Provide related services in BC - repair & maintenance for taxable goods, setup and installation of taxable goods, restoration of taxable goods, etc.

• Provide legal services in BC

• Online marketplace Facilitators (like Amazon) and Online Accommodation Platforms (like AirBnB).

Businesses Located outside BC, but in Canada

You are required to register, collect and remit BC PST if you do all of the following in the ordinary course of your business:

• Sell taxable goods to customers in BC

• Accept orders from customers located in BC (including by telephone, mail, email or Internet) to purchase goods.

• Deliver the goods you sell to your BC customers to locations in BC

• Solicit persons in BC (through advertising or other means).

• Meet the minimum BC revenue threshold:

  • your gross revenue in the previous 12 months, or estimated revenue for the next 12 months from all retail sales and leases of goods and all sales and provisions of software and telecommunication services to BC customers is more than $10,000.

You are also required to register for BC PST if you sell or provide taxable software for use to customers in BC.

Businesses with Inventory in BC

You are required to register, collect and remit BC PST if you do all of the following in the ordinary course of your business:

• Sell taxable goods to customers in BC

• Accept orders from customers located in BC (including by telephone, mail, email or Internet) to purchase goods.

• Hold the goods you sell to your B.C. customers in inventory in B.C. at the time of sale (e.g. you use a B.C. fulfilment house).

Businesses Not Required To Register

You are not required to register, collect and remit BC PST if you do not make taxable sales of goods, software or accommodation, do not make taxable leases of goods, and do not provide taxable services (related (to taxable goods) services, telecommunication services and legal services.

Small Sellers

If you qualify as a small seller, you are not required to register to collect and remit BC PST.

You may be a small seller if:

• you are located in BC,

• you do not maintain an established business premises and do not regularly make retail sales from an established commercial premises (e.g. you do not sell goods from a shop, including a home-based shop),

• you have $10,000 or less in gross revenue from all retail sales of eligible goods, software and services in the previous 12 months or estimated for the next 12 months.

Online Marketplace Sellers (E-Commerce)

If you are an e-commerce seller, who sells on an online marketplace like Amazon, then you should note:

• BC has mandated E-Commerce platforms, like Amazon, to register for and charge BC PST on sale of goods, even if the Seller (i.e. your business) is not registered for BC PST.

• Amazon would do this charge and remittance as Amazon, not on behalf of your business.

• So, if your only source of BC income is selling online through Amazon, for e.g., you could potentially skip registering for BC PST.

• However, if you also have taxable sales to BC through other avenues, for e.g. direct wholesale, or through your Shopify website (Shopify is not an online marketplace), then you would still be required to register, charge and remit BC PST if you meet all the prerequisites.

Online Accommodation platforms like AirBnB would work the same way as above.

How To Register For BC PST

Before you start charging BC PST (or any GST/PST for that matter), you need to register for it.

You can register for BC PST using any of the following options:

• Online: register using eTaxBC

• In person: visit your local Service BC Centre

• By fax or mail: complete a paper form and mail or fax it to your local BC Centre.

As you can see, these rules get complex, and outside of the most simple scenarios, need to be assessed and analyzed on a case-by-case basis.

For more detailed guidance on BC PST, refer to this official link.

If you need help with your BC PST assessment, reach out to our team!

In an upcoming post, we'll delve into Provincial Sales Tax (PST) rules for other Provinces of Canada.

✌️

Think Team

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