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For cross-border sales in Canadian e-commerce accounting, the big question is whether a sale is taxed in Canada, taxed at 0%, or outside the tax altogether. Goods you ship to a buyer outside Canada can usually be zero-rated for GST/HST, but only if you can prove they left.
What makes an export sale zero-rated?
The CRA lets you zero-rate taxable goods in three cases. You ship them straight to a destination outside Canada, you send them by mail or courier to an address abroad, or the buyer takes delivery in Canada and then exports them (that route excludes excisable goods and consumers). Zero-rated isn’t the same as exempt. You charge 0%, and you can still claim input tax credits on what you spent to make the sale.
The catch is one sentence on the CRA’s page on GST/HST on imports and exports: in case of an audit, you must keep satisfactory evidence that the goods were exported. A shipping label, a courier tracking record and a customs document are the obvious candidates. Don’t wait until someone asks for them.
Say Jen, a candle maker in Halifax, ships a $120 order to a customer in Vermont. She charges no GST/HST, records $120 of sales, and saves the tracking page and the courier’s export paperwork in a folder named for the order number. If the CRA ever asks, the proof is two clicks away.
How does GST/HST work on things you bring in?
If you import stock to resell, GST or the federal part of HST is collected at the border, on the Canadian dollar value including duty and excise tax. A shipment worth $200 with $10 of duty is taxed on $210. In a province that charges only GST, this site’s GST/HST calculator shows $10.50 on $210 (the $10 of duty is an invented example).
A few imports are not taxed. The CRA lists prescription drugs, goods donated to charities, items valued at $20 or less that arrive by mail or courier, and warranty replacements. If you’re registered, the tax you paid at the border can be claimed back as an input tax credit, subject to the usual rules.
| Situation | GST/HST treatment |
|---|---|
| Goods shipped to a buyer outside Canada | Zero-rated, keep proof of export |
| Goods sold to a buyer inside Canada | Normal rate for the destination province |
| Goods imported for resale | Tax paid at the border on the Canadian dollar value |
| Import worth $20 or less by mail or courier | Not taxed |
| Non-resident buys and exports within 60 days | May apply for a rebate |
What proof of export should you keep?
Think of it as a small file for each order, or a batch folder if you ship a lot. The kinds of records that usually show goods left Canada are:
- The invoice showing the foreign delivery address.
- The courier or postal tracking record showing delivery abroad.
- Any customs form or export document that came with the parcel.
- The payment record linking the buyer to the order.
The CRA page doesn’t hand you a fixed checklist, so treat this as a sensible starting point, not a guarantee. If a shipment is unusual or large, ask the CRA how it wants the evidence presented.
Do cross-border sales change when you register?
Maybe not for the reason you’d expect. The small supplier test counts worldwide taxable revenue, and it is $30,000 in one calendar quarter or over four consecutive quarters. You then have 29 days to register. I couldn’t confirm on the page I read whether zero-rated export sales count towards that limit, so check it with the CRA before you decide. The reason to care is that only registrants can recover the GST/HST they pay on their own costs, even when they charge 0% on sales.
Non-residents selling into Canada face a different threshold, $30,000 over any 12 months on or after 1 July 2021, and special rules for goods held in a Canadian fulfilment warehouse. If your seller account sits outside Canada, read those CRA pages first.
How do you keep a sale in two currencies straight?
Keep the original currency amount on every line, plus the Canadian dollar figure you used. The CRA’s rule for income tax is the Bank of Canada rate on the day the amount arises, with an average over a period accepted only in some cases. Choose one approach and use it every year.
Margin is where currency bites. Say a product costs you $32 and sells for $50: the profit margin calculator shows 36%. If a weaker US dollar cuts the Canadian dollar price to $39.99, the margin falls to 20%. That drop is the reason to review pricing when the exchange rate moves, not once a year. When the loonie climbs, every US sale quietly shrinks.
What goes wrong most often?
Sellers treat every foreign buyer as zero-rated. Not so, if the buyer collects the goods in Canada and never exports them. Another slip is missing the paperwork, since a zero-rated sale without proof can be reassessed as a taxable one.
Duties are a separate matter. I didn’t confirm any duty rates, and rates depend on the goods and where they’re made, so check the border agency’s tariff before you price a product. Profit ends up on your own return too. If you sell as a sole proprietor, the self-employed tax calculator gives a rough idea of the tax on it, though it leaves out EI.
Keep six years of records, generally counted from the end of the last tax year they relate to.
What this page is based on
Export, import and small supplier rules come from Canada Revenue Agency pages on GST/HST, checked in 2026. The exchange rate rule comes from the CRA income tax folio on reporting currency, and the record period from its record keeping page. The examples use invented prices and this site’s own calculators. Duty rates and non-resident details beyond the pages above were not confirmed. This is an independent guide, separate from any government body.
Frequently asked questions
Do I charge GST/HST on goods shipped outside Canada?
Usually not. Goods shipped straight to a destination outside Canada can be zero-rated, so you charge 0%, but you must keep evidence of export.
Is zero-rated the same as exempt?
No. Zero-rated sales are taxable at 0%, so you can still claim input tax credits on related costs.
Is GST charged on imports?
Yes, GST or the federal part of HST is collected at the border on the Canadian dollar value including duty. Some items, such as imports worth $20 or less by mail or courier, are not taxed.
Which exchange rate do I use?
For income tax the CRA default is the Bank of Canada rate on the day the amount arises. Other sources are accepted if they meet its conditions.
Do foreign sales count towards the $30,000 limit?
The small supplier test looks at worldwide taxable supplies. We couldn't confirm how zero-rated export sales are counted, so check the CRA page.
- Self-employed taxes in Canada: income, CPP and GST
How tax works when you are self-employed in Canada: reporting income and expenses, paying both halves of CPP, instalments and when to register for GST