Setting up Canadian taxes

If you're new to Shopify, then before you start selling, you need to determine whether you should charge sales tax. You might need to register with various tax agencies. After that, you can set up your taxes in Shopify to help ensure that you charge the correct rates wherever you sell in Canada.

Determine whether you need to charge sales tax

You need to determine whether you should charge sales tax. If you're not sure, then consult with a local tax accountant or other tax specialist, as well as with provincial and federal tax agencies.

In general, Canadian merchants need to register for a GST/HST account if both of the following are true:

  • You sell or lease taxable products or services.
  • Your worldwide revenue is more than 30,000 CAD over the past four consecutive calendar quarters.

If your store is not based in Canada, then generally you need to register for a GST/HST account if both of the following are true:

  • You sell taxable products or services to customers in Canada, and fulfill those orders from a warehouse located in Canada.
  • Your revenue from taxable orders in Canada is more than 30,000 CAD over the past twelve months.

If either of the preceding cases applies to you, then you might need to collect taxes on your sales, remit those taxes to the appropriate tax authority, and file regular reports with the tax authority. If your sales are lower than the threshold, then you don't need to register for a GST/HST account, and you don't need to collect or remit taxes.

For a summary of Canadian tax rules, refer to Canadian taxes reference.

Register with your tax agencies

If you need to charge sales tax in one or more Canadian jurisdictions, then you need to contact each of the relevant agencies and register with them. The process varies depending on where your business is based and where you sell, and on the individual government requirements.

For links to various Canadian tax agencies, refer to Registering with Canadian tax agencies.

Set up the regions in which you're registered

After you've registered with the tax agencies and have your registration numbers, you can set up your taxes. You do these steps once.

Steps:

  1. From the Shopify admin, go to Settings > Taxes.
  2. In the Tax regions section, beside Canada, click Set up.
  3. In the Sales tax section, click Collect sales tax.
  4. Select a region in which you are registered.
  5. In the Tax number field, enter your tax number. If you applied for a tax number, but don't have one yet, then leave this field blank. You can update it when you receive your number.
  6. Click Save.
  7. Optional: To add more regions and account numbers, click Collect sales tax.

You can change or remove your registrations or account numbers by clicking the ... button beside the tax account and selecting Edit or Delete.

Next steps

You can create tax overrides for products where the default tax rates don't apply.

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