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Québec Sales Tax (QST) – Explained

Question:

What is the provincial sales tax in Québec?

Facts:

In Canada, there is a federal sales tax called the Goods and Services Tax (GST). Most provinces have combined their federal sales tax with their provincial sales tax to only charge one tax called the Harmonized Sales Tax (HST). However, there are some provinces that still have provincial sales tax: British Columbia, Saskatchewan, Manitoba and Québec.

Discussion:

In Québec, the provincial sales tax is called the Québec Sales Tax (QST). Just like the GST, QST is charged and collected on most goods and services and when QST is paid it can be claimed back on your QST return. The QST rate is 9.975%.

For businesses located in Québec, they are required to register for QST when their total worldwide taxable supply of goods and services exceeds $30,000 in a given calendar quarter or in the four previous consecutive calendar quarters.

There are some business activities in which a business must register for QST even if it is under the $30,000 threshold:

  • You operate a taxi business in Québec.
  • You are not a resident in Québec and you charge admission to the public for activities or events that take place in Québec.
  • You sell tobacco at retail in Québec.
  • You sell fuel at retail in Québec.
  • You sell alcoholic beverages (unless you hold a reunion permit) in Québec.
  • You sell or lease new tires in Québec.
  • You sell or lease new or used road vehicles, other than a road vehicle that is your capital property, for a period of 12 months or more in Québec.

For businesses located outside of Québec, they are required to register for QST if they have made taxable supplies of property and services of more than $30,000 in a 12-month period in Québec.

There is an exemption where any individual, personal trust or partnership that is made up of only individuals is not allowed to register for the QST if they carry on a business without a reasonable expectation of profit or supplies tax-exempt property or services.


If you would like more information on this topic, please contact a member of the EPR tax team by completing the contact form below. Our tax experts can advise on the best structure to reduce or minimize the impact of the taxes.

Canadian and foreign tax laws are complex and have a tendency to change on a frequent basis. As such, the content published above is believed to be accurate as of the date of this post. Before implementing any tax planning, please seek professional advice from a qualified tax professional. EPR Maple Ridge Langley, Chartered Professional Accountants will not accept any liability for any tax ramifications that may result from acting based on the information contained above.


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