Updated Checked by the Tax-Services.ca editorial team How we check
The goods and services tax is a 5% federal sales tax on most things you buy in Canada. In Ontario and the Atlantic provinces it’s blended with the provincial tax into one HST of 13% to 15%. Groceries and prescription drugs carry 0%, and some things, like residential rent, aren’t taxed at all. Pay it at the till, or collect it if you sell: either way the rate depends on where the sale is made.
What rate applies where you live?
The rate follows the place of supply, which usually means where the buyer is. The CRA lists the federal 5% everywhere, and in HST provinces a provincial part is added inside the same tax. Its page on which GST/HST rate to charge is the place to confirm a rate.
| Province or territory | What you pay on a taxable sale |
|---|---|
| Ontario | 13% HST |
| New Brunswick, Newfoundland and Labrador, Prince Edward Island | 15% HST |
| Nova Scotia | 14% HST (down from 15% on April 1, 2025) |
| Alberta, Yukon, Northwest Territories, Nunavut | 5% GST only |
| BC, Saskatchewan, Manitoba, Quebec | 5% GST plus a separate provincial tax |
The separate provincial taxes (PST, RST or QST) are set by each province and collected under their own rules. We couldn’t check the 2026 Manitoba and Quebec rates against the provinces’ own pages, so look them up there before you price anything.
What is taxed at zero and what is exempt?
People mix these up, and the difference matters if you run a business. Zero-rated means the tax rate is 0%: basic groceries and prescription drugs are the usual examples. The seller still counts these sales and can claim back the tax paid on costs. Exempt means no tax is charged at all, as with residential rent, health services and financial services, and the seller can’t claim that tax back.
On a receipt they look identical. For a seller they aren’t. On groceries, the CRA’s wording is short and clear.
For example, basic groceries are taxable at the rate of zero (0% GST/HST) in every province and territory.
Charge and collect the GST/HST, canada.ca
Do you have to register for the goods and services tax?
Only if you sell taxable goods or services and pass the small supplier limit: $30,000 in total revenue over four consecutive calendar quarters. Once you go over, you have to register within 29 days of your effective date of registration. A few businesses register at any income, including taxi operators and rideshare drivers.
Under the limit you can still register on purpose, which is worth a look if you buy a lot of equipment, because a registrant can claim input tax credits on eligible business purchases. The catch is that you’ll have to charge tax to customers too. Keep your records for six years.
What does registering actually change for a small seller?
Say Leila, a freelance designer in Calgary, bills $40,000 in a year and is registered. She charges 5% GST on her invoices, which is $2,000. During the year she paid $6,000 for software, a laptop and supplies, with $300 of GST on top. She claims that $300 as an input tax credit and sends the CRA the difference: $2,000 minus $300 is $1,700. Those are assumptions for illustration, and real returns have more lines, but as a ballpark the pattern holds. You collect, you subtract what you paid, and you remit the rest.
What does it cost on a real purchase?
Say a business in Ontario buys $20,000 of taxable equipment. The GST/HST calculator puts the HST at $2,600 and the total at $22,600. The same purchase in Alberta carries $1,000 of GST. In Nova Scotia it’s $2,800.
Going the other way, you often have a total on a receipt and need the tax inside it. The HST reverse calculator divides by one plus the rate, so $11,300 in Ontario is $10,000 plus $1,300 of HST. If you’re in a province with a separate provincial tax, the GST and PST calculator handles the combination, though check it against a real receipt for restaurant meals or other items with special rules.
Mistakes that cause trouble
Charging the wrong rate is the most common slip, and it hurts. Selling to a customer in another province can change the rate, since the place of supply decides it. Rounding is another: a receipt can differ from a calculator by a cent.
Mixing up zero-rated and exempt comes next, because it decides if you can claim input tax credits. And don’t forget the reverse case. If you never registered but you’re over $30,000, you owe tax you didn’t collect, and that comes out of your pocket.
If you’re on a low income, the tax isn’t all loss. The federal benefit that replaced the GST/HST credit in July 2026 pays a single adult up to $679 a year. The GST/HST credit calculator shows what you’d get.
Sources, and how we checked them
Rates, the small supplier limit and the zero-rated and exempt rules come from Canada Revenue Agency pages on charging and registering for GST/HST, read in 2026. The benefit amount comes from the CRA page for July 2026 to June 2027. Examples use our calculators, and the freelancer example is a simple illustration, not a return. Rules for special items such as new homes, restaurant meals and cross-border sales are more detailed than this page, so use the CRA guides for those.
Frequently asked questions
What is the GST rate in Canada?
The federal rate is 5%. Where a province has HST, the combined rate is 13% in Ontario, 14% in Nova Scotia and 15% in New Brunswick, Newfoundland and Labrador and PEI.
When do you have to register for GST/HST?
When your taxable sales pass $30,000 over four consecutive calendar quarters. You then register within 29 days of your effective date.
What is the difference between zero-rated and exempt?
Zero-rated sales are taxed at 0% and the seller can still claim input tax credits. Exempt sales carry no tax and no credits.
Is there GST on groceries?
Basic groceries are zero-rated in every province and territory, so the rate is 0%.
How much tax is on $20,000 in Ontario?
HST of $2,600, for a total of $22,600. In Alberta the GST would be $1,000.
- How Canadian income tax works: brackets and credits
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