Due to updated Canadian tax regulations, marketplaces like Etsy may be required to collect and remit tax - including GST/HST, QST, and PST - to the relevant Canadian tax authorities on items purchased by buyers in Canada, and on fees charged to Canadian sellers in certain circumstances.
Starting July 1, 2022, Etsy began collecting GST/HST on eligible orders placed by shoppers in Canada. Etsy automatically includes the tax in the buyer’s total at the last stage of the checkout process. Etsy is then responsible for remitting it to the relevant tax authorities.
See Canada’s government website for more information on these new tax requirements.
Jump to a section:
- Do I need to register for Canadian tax IDs?
- What tax does Etsy collect from Canadian buyers to remit to the tax authorities?
- When does Etsy collect taxes from Canadian buyers?
- What is the tax on seller fees?
- How do I enter my Canadian taxpayer IDs?
- How do I find the amount Etsy remits?
Do I need to register for Canadian tax IDs?
Canadian tax regulation requires sellers to register for a GST/HST ID and to collect and remit the tax to the CRA once they’ve reached $30,000 CAD in sales.
Sellers who have not met this threshold may not be required to register for a Canadian Tax ID, but should make the decision for themselves on whether it makes sense for their business.
The provinces of Quebec, Manitoba, Saskatchewan and British Columbia also have their own tax rules.
If you need help registering for GST/HST or any other taxes, or have other questions on your tax obligations, please reach out to your tax and legal advisor.
What tax does Etsy collect from Canadian buyers to remit to the tax authorities?
Etsy will not collect and remit these taxes from Canada buyers for sales of physical goods. You should adjust your listing prices to collect any required taxes, then remit it to the appropriate tax authorities with your GST/HST or your QST filing.
By adding your GST/HST ID or QST to your Etsy account, you’re letting us know you’re already handling the taxes you're responsible for. This will prevent your buyers from being charged taxes twice.
If you’re already collecting and remitting this, it may result in buyers being charged taxes twice, where both you and Etsy collect taxes and remit them.
When does Etsy collect taxes from Canadian buyers?
Etsy will start collecting tax on relevant purchases from Canadian buyers from 1 July 2022 in the followings scenarios:
|Seller Tax ID Status
|When are buyers charged?
GST/HST ID added to account
If the item is being shipped from a seller in Canada to a buyer in Canada, the seller will automatically include GST/HST in the listing price.
No GST/HST ID added
GST/HST will be charged at checkout where:
QST ID added to account
If the item is being shipped from a seller in Canada to a buyer in Quebec, the seller will automatically include QST in the listing price.
No QST ID added
QST will be charged at checkout where:
|British Columbia Provincial Sales Tax (PST)*
PST will be charged at checkout on all physical items and digital downloads delivered to buyers in British Columbia from locations in Canada.
Saskatchewan Provincial Sales Tax (PST)*
PST will be charged at checkout on all physical items and certain digital downloads delivered to buyers in Saskatchewan.
Manitoba Retail Sales Tax (RST)*
RST will be charged on physical items and certain digital downloads delivered to buyers in Manitoba.
*Etsy is required by law to collect these taxes from your buyers in Manitoba, Saskatchewan and British Columbia and remit it to the local tax authorities, regardless of whether you have a registered tax ID from these provinces. Where the seller is GST/HST registered, Etsy may collect slightly less PST/RST/QST on physical goods to take into consideration the GST that the seller has already included in the listing price. Where the seller is QST registered but not GST/HST registered, you may notice that Etsy will charge slightly less GST on physical goods to taken into consideration the QST that the seller included in the listing price.
Etsy will only charge the buyer taxes on items if they are ordinarily applied to the item in these regions, assuming that it has been listed correctly. For example, Etsy will not tax children's sized clothing in British Columbia, since it is not ordinarily subject to PST there.
What is the tax on seller fees?
The new Canadian regulations also require marketplaces to collect tax on the fees charged to sellers. The tax charged will depend on where the seller is located, and in some cases whether or not the seller is GST/HST or QST registered. Any taxes collected on your seller fees will be remitted by Etsy to the relevant tax authority.
If Etsy has already collected GST/HST on the order, you won’t be charged GST/HST on order-related fees (payment processing and transaction). GST/HST will always be charged on all other seller fees such as listing fees, Etsy Ads or Offsite Ads fees, or Pattern subscription fees regardless of registration status.
You’ll see the tax you pay on your fees reflected in your shop payment account.
Seller Taxable Status
What Will I Be Charged?
Seller is GST/HST Registered
GST/HST will be charged on all seller fees.
Seller is not GST/HST Registered
GST/HST will not be charged on payment processing and transaction fees for the sale of an item that Etsy already charged the buyer GST/HST on.
GST/HST will be charged on all other seller fees.
Quebec Seller is QST Registered
QST will be charged on all seller fees
Quebec Seller is not QST Registered
QST will not be charged on payment processing and transaction fees for the sale of an item that Etsy already charged the buyer QST on.
QST will be charged on all other seller fees.
Seller in British Columbia
PST will be charged on all seller fees
Seller in Manitoba or Saskatchewan
PST will not be charged on any seller fees
If Etsy charges you tax on your seller fees, speak with your tax accountant to find out if you can reclaim that tax from your local tax authorities.
How do I enter my Canadian taxpayer IDs?
Follow these steps to add your Canadian taxpayer IDs to your account:
Double check that you’re entering your ID in the correct field. Submitting it in the wrong field (such as putting GST in the QST field) will result in an error.
How do I find the amount Etsy remits?
You can find the sales we report to Canada by downloading your Orders CSV file.
To use your Orders CSV to see the amounts:
- Open Shop Manager.
- Choose Settings.
- Choose Options.
- Select the Download Data tab.
- Select Orders as the type.
- Choose the year but leave the month blank.
- Download and open the CSV.
- Look for and sort the Buyer Country column.
- Add the Processing Fee and Order Net columns for sales that were completed by buyers in Canada.
If you have any canceled orders from Canadian buyers, you should also count those.
To find your canceled orders:
Select Canceled under the Completed status on the right.