Updating to the new Canadian taxes feature
If you're already using Shopify to sell in Canada, then you can update your store to use the new Canadian sales tax features. If your store is eligible to be updated, then a banner appears on the Taxes page prompting you to update your tax settings. When you click the Update tax settings button, you're asked to provide a tax registration number. After you've added this number, Shopify automatically sets the tax rates that apply provincially and federally in the areas you've registered for.
Shopify Support can help you with your tax settings in your Shopify admin, but you'll need to make some decisions yourself (or with the help of a tax professional). We're not able to provide legal tax advice. If you're encountering any trouble changing your settings, you can contact Shopify Support for help.
Do I need to register for a tax number?
That depends on your business. In general, in Canada you're obligated to register for a GST/HST account if you sell taxable goods or services, and make more revenue than $30,000 CAD in a year. You might also need to register in a province, if they charge a provincial sales tax (PST) separately from the goods and services tax (GST).
There's more information on this in the Canadian taxes reference page. If you're at all unsure whether you need to register for a tax account, reach out to a local tax expert.
How do I know if I need to register at the provincial level?
The provinces that charge a separate provincial tax are British Columbia, Manitoba, Quebec, and Saskatchewan. These requirements vary depending on the province. For more details, refer to Canadian taxes reference.
For example, you might need to register if you operate or advertise in those provinces.
I need to register. What do I do?
After you've registered, add your tax registration number on the Taxes page.
On the Taxes page, click Update tax settings.
On the Canada taxes page, enter your account number for each type of tax or region that applies.
For each region in which you're not registered, click Not registered.
I don't need to register. What do I do?
If you've determined that you don't need to charge Canadian taxes, then go to your Taxes page and select the Not registered to charge option. Selecting this option will ensure that you're not charging tax in your store.
This option is recommended rather than setting your customers as tax-exempt or setting your products to be tax-free. If you don't need to register to collect taxes now, then you might need to in the future. Entering a registration number is much easier than having to change your settings for customers or products.
Will I be able to override tax settings?
Yes, with some restrictions. You're able to override settings that apply to your store specifically - that is, only those that you've entered registration numbers for. For more information about how Canadian tax overrides are affected when you update, refer to Canadian tax override requirements.
Where can I go for more help?
Shopify support is able to help you with how to change your settings, but can't advise you on if you should change your settings. If you need help determining if you should register with tax agencies and charge taxes to your customers, your best resource is a local expert such as an accountant or financial advisor. You can also reach out to individual tax agencies directly.
I've updated my tax settings. Why am I getting different tax amounts?
In some orders, you might notice a small variance in your total tax amounts after you've updated your tax settings. This variance is due to tax amounts being rounded at the line-item level, rather than at the invoice level. You can learn more about rounding calculations in Managing your Canadian taxes.