Does a non-resident business selling into Ontario need to register for HST?
This is primarily a federal GST/HST question governed by the federal Excise Tax Act. A non-resident business may be required to register for GST/HST in Canada — and therefore collect HST on supplies made in Ontario — depending on what it sells and whether it is "carrying on business" in Canada.
For tangible goods, a non-resident that solicits orders in Canada and makes taxable supplies there generally must register once it exceeds the $30,000 threshold. For digital or electronic services sold to Canadian consumers, the rules changed in recent years: non-resident suppliers of digital products and services (streaming, software, apps) to Canadian consumers must register once they exceed the $30,000 threshold in Canadian sales, under a simplified registration system.
Non-residents can use the simplified GST/HST registration for digital services or the standard registration route. The simplified regime does not allow input tax credit claims but has a lighter filing burden. Because the rules for non-residents are nuanced and fact-specific, consulting a Canadian tax lawyer is strongly recommended.
Key takeaways
- Non-resident digital-service sellers must register once they exceed $30,000 in Canadian sales.
- Physical goods sold in Canada can also trigger registration.
- A simplified registration exists for non-resident digital suppliers.
- Canadian tax rules for non-residents are complex — get specific advice.