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Canadian HST tax
 
redwagon
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Does Magento support HST for Canada?

 
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adimagento
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Can you describe how this tax system works please.

 
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redwagon
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This is the description from someone else. I’m not from Canada, so don’t know much about it:

GST is Federal and PST and HST is provincial.

If you sell within an HST province you will setup HST and GST as your taxes. If you sell outside your province I believe you only charge GST.

Selling outside Canada - there is no tax.

If you are in say Ontario, all we have to do is setup PST for Ont, and GST for the entire country. We do not charge PST or HST to customers outside our province.

From what I understand if you have a physical presence in other provinces then you will charge that provinces Taxes.

 
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Sébastien Yaher
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I don’t know for Ontario, but here is how I’ve set up my shop, here in Quebec:

- GST: 5% applicable to whole canadian customers
- PST: 7,5% applicable to customers from quebec province
- For outside canada, no tax.

I’ve created 3 different rates:
- 1 applicable to canada, without selecting the province: 5%
- 1 applcable to quebec province only: 12.875% which is the result of this equation (price+5%)+7.5%
- 1 at 0% for U.S, since we are selling only to Canada and US.

This way you can’t see the difference between PST and GST but at least you calculate the right amount of taxes.

 
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redwagon
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Thank you.

 
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yhugo
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Hi,

on the Revenu Québec Website :

General rules

Most property and services are subject to the GST/HST and the QST.

* The GST/HST is calculated on the selling price at the rate of 5%.
* The QST is calculated on the selling price (including the GST) at the rate of 7.5%.

And we need to indicate the amount of the taxes on the invoices ... the GST and QST ...

How we can do that with Magento ?

Thanx

 
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myttshop
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Sébastien Yaher - 10 July 2008 09:57 AM

I don’t know for Ontario, but here is how I’ve set up my shop, here in Quebec:

- GST: 5% applicable to whole canadian customers
- PST: 7,5% applicable to customers from quebec province
- For outside canada, no tax.

I’ve created 3 different rates:
- 1 applicable to canada, without selecting the province: 5%
- 1 applcable to quebec province only: 12.875% which is the result of this equation (price+5%)+7.5%
- 1 at 0% for U.S, since we are selling only to Canada and US.

This way you can’t see the difference between PST and GST but at least you calculate the right amount of taxes.

In Ontario, PST is 8% of the original price. For example, if the price is $100, then:
GST(5%) is $100 x 0.05 = $5
PST(8%) is $100 x 0.08 = $8
the total comes $113.

But when I setup the tax rates in Magento, it becomes:
GST(5%) is $100 x 0.05 = $5
PST(8%) is ($100+$5) x 0.08 = $8.4
the total comes $113.40, this is wrong.

How can I make it right?

 
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inyerface
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You have it setup as compounded tax - which would be useful for a Quebec resident selling within Quebec.  Make sure your tax rules have a priority of 1

 
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Donovan
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It’s actually much more involved than that…

In sum, as an online retailer accepting and shipping orders across Canada, the list of taxes you should be collecting and remitting currently looks like this:

* BC – GST & PST
* Alberta – GST
* Saskatchewan – GST & PST voluntarily (unless is home province)
* Manitoba – GST & PST
* Ontario – GST & RST if have a “business presence” (unless is home province)
* Quebec – QST
* New Brunswick – HST
* Nova Scotia – HST
* Newfoundland & Labrador – HST
* Prince Edward Island – GST & PST voluntarily (unless is home province)
* Northwest Territories – GST
* Nunavut – GST
* Yukon – GST

(*In your home province, registration for PST/RST is mandatory if you are selling taxable goods and/or services.)

This means that you should register as a Provincial Sales Tax Vendor with each of the provinces you will be doing business with and will be expected to collect and remit the sales tax accordingly.

What can you do to get around all this additional paperwork and bookkeeping? Not much. Some Canadian-based online businesses limit the areas they ship to. An Ontario based business, for instance, might only accept orders from and ship to customers in Ontario. Others only sell non-taxable goods and/or services.

Source: http://sbinfocanada.about.com/od/pst/a/PSTecommerce.htm
The article itself provides much more information - this is just the summary.

Cheers,
...Donovan

 
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christ
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Thanks for the info Donovan, I recall going over those specs some time ago then procrastinating on the magento setup to handle the rules due to the rules being so insane to wrap my head around.

I’m still trying to get the magento setup sorted to handle canadian tax rules.

Basically I am thinking that I am going to have to set up a GST rule for each province where GST is collected. Then a PST rule for each Province that requires I collect PST… Then set up the HST rules for each province that utilize HST.

I’d much rather set up PST rules for each required province, and HST rule for each required province and then have an all encompassing GST rule for Canada that’d exclude the HST provinces.

I’m using magento 1.1.8 and it seems the tax rate docs posted in the knowledge base are a bit outdated and do not reflect the current set up.

So. My question… has anyone successfully configured a magento store to operate and sell to all provinces and territories in Canada and at the same time collect taxes properly? If so, would they mind sharing their set up/config details for their taxes?

If not, does it sound like my first idea might fly?

<begin rant>stupid canadian tax rules are shooting themselves in the foot by making it near impossible to navigate and manage the myriad of ever changing tax rules that they lose out on revenue when people either misconfigure their store rules/try and sneak under the table/or just do it plain wrong/illegal. stupid canadian tax rules < end rant>

 
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inyerface
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Follow my thread for the exact instructions for setting Canadian tax at http://www.magentocommerce.com/boards/viewthread/17546/#t78295 (note: this is based on a company operating out of Ontario).

We have been operating this way for years and our acounts at KPMG likethe way it’s setup. Revenu Canada seems to be fine with it too even after a few audits.

 
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InnoVeight.ca
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It sure does! I have a complete how to on website:
http://innoveight.ca/stuff/blog/100-magento-canadian-taxes

 
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Donovan
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InnoVeight.ca - 15 December 2010 05:36 PM

It sure does! I have a complete how to on website:
http://innoveight.ca/stuff/blog/100-magento-canadian-taxes

InnoVeight updated their very helpful blog post and, in the process, changed the new URL to http://innoveight.ca/magento-taxes-setup/

 
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iversa
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Thank you Donovan for keeping the link uptodate

You may want to read the comment I made on the blog. I think I have a solution to my own comment but I need to try it in Magento

Here is the link again

http://innoveight.ca/magento-taxes-setup/

 
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