How to claim PST refund on purchases for resale?

[dipmicro]

When you import goods using commercial carriers, they automatically charge PST+GST from the imported goods so there is no way to claim PST exemption.

I never tried to get PST refund (the amounts were too small to bother, etc), but now I accepted an import from China (by UPS), where it might be wortwhile to fill a form. Can someone advice what I need to do? Do I need to fill the form for every instance or is there a way to sumarize PST overpayments over period of time and claim them at once?

Interestingly, until recently we have been importing from China using EMS (a.k.a. Xpresspost). We were never charged for any taxes (I wondered). This timewe tried UPS, because our supplier found that above 20-something kilos UPS is cheaper than EMS plus it's twice as fast (this one came in 3 days).

[pierrelebel]

Use the "adjustment" line on your PST return. .

[dipmicro]

Thanks Pierre.

How did you manage to read my post and respond the same minute as I posted it ? 😉

[lina-mallows]

pierrelebel - while some may appreciate your suggestion- I believe that you are 100% incorrect.
INFO at : http://www.rev.gov.on.ca/english/taxes/rst/

This is not the way to recover PST.
GST ITC methods do not carry forward to PST.

A claim for a REFUND of PST paid must be made to the Ministry of Revenue ONTARIO.

Use the: General Application for Refund of Retail Sales Tax FORM

Any offsetting of ONTARIO PST as an INPUT TAX CREDIT is only inviting trouble.

[pierrelebel]

That is exactly what I wrote.

In Ontario, to claim PST paid on your purchases, a registered vendor uses the adjustment line on the PST return.

It has nothing to do with GST/HST.

"Any offsetting of ONTARIO PST as an INPUT TAX CREDIT is only inviting trouble. "

???? Where do you get that from? There was nothing on any post about ITC (that's federal, not provincial). .

[fatdane]

If Canada post, Fed Ex, UPS etc dinged you for Ontario Provincial Sales Tax you have to apply to the Canada Border Services Agency, Customs Refund Centre, In Ontario 55 Town Centre Court, 7th floor, Scarborough, Ont M1P 4X4, individuals 416-973-1811, Companies 416-973-5650. I applied to the Provincial Govt to get the PST refunded on a shipment from England, and after 2 months got a form letter from the Ontario PST folks saying the claim was denied and refering me to the above agency. The frustrating part is that I had submitted the claim to the Ontario PST based on phone calls to the Ontario PST help line - who don't seem to know their own regulations.

On an item imported via Canada Post I have now been told by the Canada Border Services Agency that I should apply for the refund using the back of the Canada Post form, Reason for Refund request, use other and give details. If you have an RM number it is supposed to help.

Isn't it amazing how the governments can make getting money back from them so darn difficult - It took a morning on the phone with GST and border Services people before I got some one who knew what the bleep the procedure for a refund was. I hope some of the civil servants I encountered end up in purgatory getting voice mail and being cut off when they try to call St Peter

[recped]

Dipmicro

Call UPS and give them your PST # so in future it doesn't happen again. While you're at it you could also tell them you will self clear in future or that they should pay out any duty/tax from your credit card. You probably don't have the basic brokerage fees because they were air/express shipments but they may still be charging fees for "disbursements".

[dipmicro]

Recped, thanks for the advice. Self clearing seems to be hassle. My supplier uses door-to-door cleared service (I paid approx $270 shipping on $24kg parcel). Kind of pricey, but still worth it. EMS would have been even more pricey.

UPS tried to setup an brokerage account with me before but the rates they offered with account would cost me more with my volumes. It starts being interesting only from certain volumes.

[lina-mallows]

pierrelebel- I will try and be clear-
YOU MAY NOT USE THE ADJUSTMENT LINE TO CLAIM AN ONTARIO PST CREDIT.

The adjustment line- on an ONTARIO PST form - IS NOT the same as an ITC on a GST FORM.

PDF available at: http://www.rev.gov.on.ca/english/taxes/rst/

You must file a separate form to RECOVER ONTARIO PST paid- NOT the adjustment line!!!

Is that clear?

[recped]

Self clearing seems to be hassle

It can be, you have to balance the factors.

Just tell them to stop it with the PST thing.

[lina-mallows]

The ADJUSTMENT LINE is NOT to be used TO CLAIM A PST PAYMENT.

http://www.rev.gov.on.ca/english/resources/smallbusiness/remit_rst_adjust.html

Here is what the ONTARIO PST website says:

Reporting and Remitting

Retail Sales Tax

Adjustment Information

Line 6 of your return is used for adjustments. Use this line to:

identify and pay tax assessments
identify and deduct Ministry-approved credits
adjust mistakes made on previous returns, such as underpaying or overpaying RST
correct calculation errors made on previous returns.

---------------------------------------------------
TO CLAIM AN OVERPAYMENT of ONTARIO PST:
http://www.rev.gov.on.ca/english/forms/rst/index.html

General Application for Refund of Retail Sales Tax PDF form available
http://www.rev.gov.on.ca/english/forms/rst/pdf/0298.pdf

[cumos55]

In Manitoba you use your PST number so that you will not be charged PST when you buy something for resale.

I do not know if you can get a refund once PST is paid... still new to the PST rules. I do get the impression refunds are not available, but then I could be wrong

The main reason I do have a PST number is the total value of annual sales is above $10,000 and not because of what I sell and to whom I sell.

Most everything I sell is PST exempt.

PST is different than GST where there is a flow through... The GST paid is deducted from GST collected and that final amount is forwarded as your amount of GST paid.

[dipmicro]

cumos55, GST is extremely easy to deal with, while PST is extremely PITA. I wish Ontario govt. just switched to HST like other smart provinces did because all the businesses are wasting all this energy on stupid stuff like this. It's big enough for us to care but too small for them (prov.government) to make a proper and easy procedure like fedarls did with input tax credits.

fatdane, thanks for all the information, I will try to call the number you wrote. It's around $47 in PST overcharging.

The idiots in UPS wrote $76.43 under GST. The whole amount for duty was $584.43. I looked at it and say, that aint right, GST is only 5%. Well, seems the UPS import charges invoice does not recognize GST and PST.

UPS is the biggest scammer among carrier. Firstly, they collect taxes knowing these might be claimed back. They could have simply asked when delivering, but they automatically assume charges. They only file tax return 4x a year, so the PST is going to sit on their GIC or they will be turning it as a part of operating expenses money increasing their overall profit. I wish UPS went bankrupt after few agonizing years of oblivion. A man can dream, right?

What if every business starts doing this, nobody will be accepting anybody's Tax Exempt Certificate and we will all automaticaly assume PST and then have the customer deal with the government instead.

Yes recped, I will try to call UPS, but they will want to setup an account and if yopu just use them occasionally, it's not a good thing to have an account with them.

[lina-mallows]

dipmicro- PLEASE be careful what you wish for!
NOT having HST, or any combined formula for the application of ONTARIO PST- allows the PROVINCIAL Government to set its own policies.

So, the next time you buy a BOOK/NEWSPAPER, or a PREPARED MEAL under $4, or BABY CLOTHES, FOOTWEAR COSTING LESS THAN $30, FEMININE HYGIENE PRODUCTS, and a WHOLE list of OTHER EXEMPT items
WHICH ARE FULLY, AND ALWAYS, SUBJECT TO GST- be grateful that we DO NOT have a HARMONIZED SYSTEM!

I agree that an ITC method for offsetting of ONTARIO PST paid in error, would be a good thing. HOWEVER, we don't need to get into bed with the feds to accomplish this !!!

[cumos55]

Look at postage to New Brunswick, and fact it is HST at $15 % (or is it 14 %) and not GST at 5 %.

So everywhere else it is a value, and 10 % more for New Brunswick . Difficult situation when you state S & H as a maximum and then find out it is $2.00 more to New Brunswick... and two other provinces as well.

That $2.00 is paid by me and not the buyer... fortunately not too many buyers from New Brunswick

Do not wish for HST... GST + PST = HST...

Right now Manitoba has different rules for charging of PST, as opposed to the rules for GST... and that is why PST is separate from GST in Manitoba.

[dipmicro]

cumos55, GST and PST were designed to be payable by end user not by business. Some businesses absorb it (from what yopu said it looks like you do it too). I don;t think it's a good practice, buyers are used to paying taxes on top and this way they compare your tax-included pricing with before-tax of your competition, which puts you at disadvantage.

Anyhow, the buyers end up paying GST + PST most of the time (most sales happen within the province). Harmonizing would just save a lot of dull accounting work to everyone.

[fatdane]

For a shipment to New Brunswick, Nova Scotia, and Newfoundland and Labrador you will be charged HST of 13 %. IF you registered for GST/HSt this is an Input Tax Credit ( ITC). and is SUBTRACTED from the GST/HST that you remit to the spendthrifts in Ottawa. IF you have more ITC's than tax collected you get the excess back from the Government. A seller that is registered for GST/HST DOES NOT PAY the GST/HST - he, she or it has the amount floating around on the business books until the GST/HST return is submitted. It should not be considered a cost

The main advantage for me in having a HST in Ontario would be one less tax return to fill out and one less set of auditors to deal with ( and the PST Boys and Girls can be aggressive vultures).

[lina-mallows]

dipmicro- When you write "GST and PST were designed to be payable by end user not by business"- this is 100% incorrect.

PST, and retail sales taxes are designed to be paid by the END USER.
GST IS NOT !!!!!
GST is a value added tax, that replaced the former manufacturing tax- and is NOT an END USER tax. That is why each person/company/entity pays the applicable GTS, and if applicable, when passing that item/service/good onto another, they offset the taxes collected with the taxes already paid (ITC's).
GST is not, and never was meant to be an END USER TAX.

And, the laws (as written) fully allow any supplier (with some exceptions) to include, or exclude the tax in their prices, as they chose.