GST, PST, and HST: What Every BC Small Business Owner Needs to Know
Sales tax in British Columbia can be confusing—especially when you’re running a small business. Between GST, PST, and HST, how do you know what to charge, collect, and remit?
The Basics of Sales Tax in BC: GST, PST & HST Explained
Understanding sales tax is crucial for every small business owner. Here’s a breakdown of what you need to know:
1. What Is GST?
The Goods and Services Tax (GST) is a 5% federal tax that most businesses in BC must charge once they earn more than $30,000 annually.
Important GST facts:
Must be registered through the CRA
Collected on most goods and services
Can be remitted monthly, quarterly, or annually depending on your business volume
Allows you to claim Input Tax Credits (ITCs) for business purchases
2. What About PST?
The Provincial Sales Tax (PST) in BC is 7% and applies to many goods and select services. Unlike GST, PST is managed by the provincial government and requires separate registration.
You may need to collect PST if you:
Sell taxable goods
Lease taxable goods
Provide taxable services (e.g., software, legal)
PST registration and reporting are done through the BC Government’s eTaxBC portal. It's important to keep separate records for GST and PST.
3. What About HST?
British Columbia does not use Harmonized Sales Tax (HST), but you may still encounter it if you sell products or services to clients in provinces like Ontario, New Brunswick, or Nova Scotia. HST combines GST and provincial taxes into a single rate in those regions.
If your business serves customers outside BC, be sure to research the correct tax structure per province.
4. When to Register for GST or PST
If your revenue exceeds $30,000 over four consecutive quarters, GST registration is mandatory. For PST, it's not based solely on revenue—you must register if you sell taxable products or services within BC.
Even if you’re under the threshold, registering voluntarily may allow you to claim Input Tax Credits and appear more professional to clients.
5. Common Mistakes to Avoid
Charging GST/PST incorrectly on non-taxable services
Forgetting to remit tax collected
Missing deadlines for quarterly or annual filing
Not keeping proper records for audit purposes
6. How a Bookkeeper Helps
A professional bookkeeper helps you:
Track taxes collected and remitted accurately
File returns on time and avoid penalties
Set up bookkeeping systems to automate tax calculations
Stay compliant with CRA and provincial regulations
7. Why Bookkeeping Support Is Key to Small Business Success
Tax compliance doesn’t have to be stressful. With the right guidance and bookkeeping systems in place, you can stay ahead of your obligations and avoid costly mistakes.
At Stand Sure Solutions, we help BC entrepreneurs simplify their sales tax process and avoid costly errors. We help you:
Determine your GST/PST obligations
Set up clean and automated tax tracking systems
Stay organized for CRA and BC Government filings
Feel confident heading into tax season.
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