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Electronic invoicing in Canada starts with a simple fact: we couldn’t find any official CRA page that forces businesses to invoice each other electronically. What the CRA does care about is that every invoice shows the details your customer needs to claim a GST/HST credit, and that you keep the electronic copy for six years. Get those right and the tool you send them with is up to you.
Is electronic invoicing required in Canada?
For ordinary business-to-business sales, we found no official requirement. Articles from software vendors talk about mandates coming, but none of it came from a government page we could open, so we’re leaving it out. Check the CRA’s business pages before you act on a rumour.
Selling to the federal government is different in one respect. The CanadaBuys page on invoicing says invoices must follow the details written into your contract. It doesn’t spell out a format, so read the contract and ask the contracting authority. That’s the place a platform or format requirement would show up.
What must an invoice show before a customer can claim the tax back?
This is the part that sinks sloppy invoices. The CRA’s input tax credit page ties the required detail to the amount on the document.
| Total paid or payable | What the supporting document needs |
|---|---|
| Under $100 | Supplier’s name, date, total amount |
| $100 to $499.99 | The above, plus the supplier’s GST/HST registration number and either the GST/HST charged or a statement that the price includes GST/HST at the applicable rate |
| $500 or more | All of that, plus the buyer’s name, payment terms and a short description of what was sold |
Your software should print these fields without you typing them each time. If you issue invoices from a template you built yourself, check the registration number is on it. It’s the one people forget.
Watch the line at $500. A few bucks of tax is all it takes to cross it. A job that’s $450 before tax in Ontario comes to $508.50 with 13% HST, so it lands in the top row even though your price looked smaller. If your template only adds the buyer’s name and payment terms on bigger jobs, make sure it switches on at the right moment, or just print them on every invoice.
What does an electronic invoice look like in practice?
Take a $1,200 consulting job in Ontario. The GST/HST calculator adds $156 of HST for a total of $1,356. That’s above $500, so the invoice needs the full set: your name and registration number, the customer’s name, the date, the $156 tax shown on its own, the payment terms and a line saying what the work was. A PDF emailed from your system can do all of that.
The customer may send you back only the total. If you have $1,356 on a bank statement and need the tax, the HST reverse calculator gets you to $1,200 plus $156 in seconds. But that’s a check, not a substitute for an invoice that shows it.
How long must you keep electronic invoices?
Generally six years from the end of the last tax year they relate to. The CRA’s GST/HST guidance adds that it may ask you to keep them longer in some cases, so don’t purge on the anniversary without checking whether anything is open. Electronic copies have to stay readable the whole time, even if you also printed them. The circular on electronic record keeping says copies for the CRA should be in a non-proprietary, commonly used format, so a PDF plus a CSV export of your invoice list is a sound habit.
Records also have a location rule. They belong at your place of business or home in Canada unless the CRA permits otherwise, though it may allow electronic records elsewhere when copies reach its officials in Canada. If an invoicing platform holds your only copy, test that you can download a full set.
Where does switching to e-invoices go wrong?
Numbering is a common one. Two systems running side by side produce duplicate invoice numbers, and then reconciling is a mess. Turn the old one off on a clear date and note the last number used.
Tax settings trip people up as well. Plenty of small sellers charge the wrong rate because the customer’s province isn’t what they assumed. Test a sale to a customer in each province you sell into before you send real ones. Then check your margin still works, since chasing payment faster doesn’t help if pricing is thin: the profit margin calculator is a quick way to see that.
We haven’t covered any platform’s price, speed or features, because we couldn’t confirm them. Ask for a trial and send yourself an invoice.
What should you do before sending your first batch?
Send one to yourself and read it as your customer would. Is your registration number visible? Is the tax on its own line? Does the payment term say something a person can act on, like “due in 30 days” rather than a vague note? Then send a test to your accountant or a friendly customer and ask whether it opens cleanly on their phone. Five minutes now beats a week of emails later, when someone can’t claim the tax because a field was blank.
Where this information comes from
The invoice details come from the CRA input tax credit page. Record retention, electronic format and location come from CRA Information Circular IC05-1R1, the CRA page on where to keep records and its GST/HST records page. The contract point comes from CanadaBuys. We aren’t a government service and we don’t speak for one.
Frequently asked questions
Is e-invoicing mandatory in Canada?
We found no official page requiring it between businesses. For federal government contracts, invoices follow the contract terms.
What must be on an invoice for a GST/HST credit?
It depends on the total. Under $100 you need supplier, date and total. From $100 the tax and registration number are added, and from $500 the buyer, terms and a description.
Is a PDF invoice acceptable?
The CRA accepts electronic records, as long as they stay readable and you can provide a copy in a common format.
How long do I keep electronic invoices?
Generally six years from the end of the last tax year they relate to. The CRA may ask for longer in some cases.
Where can the invoice files be stored?
At your place of business or home in Canada unless the CRA permits otherwise. It may allow electronic records elsewhere if copies reach its officials in Canada.
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