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| Province | Sales Tax Rate | Also charge sales tax on S & H |
 | ||
| ||
| ||
| Alberta (AB): | 5% |
| British Columbia (BC): | 5% |
| Manitoba (MB): | 5% |
| New Brunswick (NB): | 15% |
| Newfoundland and Labrador (NL): | 15% |
| Northwest Territories (NT): | 5% |
| Nova Scotia (NS): | 15% |
| Nunavut (NU): | 5% |
| Ontario (ON): | 13% |
| Prince Edward Island (PE): | 15% |
| Quebec (QC): | 14.975% |
| Saskatchewan (SK): | 5% |
| Yukon (YT): | 5% |
Quebec should be 5% GST only unless you reside and ship from QC where the higher rate applies.
"I'm in Quebec so it's all good."
Oooops! Your listings show location Mississauga, Ontario.
If you ship from Quebec, your listings should be revised accordingly.
"...did you personally charge taxes or did you assume charging tax was hurting your sales..."
I always sold everything (on eBay, my website, other venues) without adding the tax to Canadian buyers. I absorbed it.
Now, less than 20% of my sales were within Canada. So the net cost to me was relatively low (less than 2% of all sales). I looked at it as a marketing cost - a cost of doing business.
I also sold in a category where most (not all) Canadian competitors also absorb the tax (if GST/HST registered) or did not charge it if they were not GST/HST registered.
"... my items are located and shipped from Ontario"
As such, only 5% GST applies to taxable items shipped from ON to QC - whether you charge tax to buyers or not, only 5% needs to be remitted.
" registration will permit me to recoup at least a good portion of those payments through ITCs. "
GST/HST registration allows you to recoup ALL taxes paid through ITCs.
" were you able to claim those payments as losses or expenses? "
KISS.
For income tax and bookkeeping purposes, you add up your revenues (sales and shipping charges)
You deduct your cost of goods
Giving you your "gross profit"
You then add up all your expenses, which you deduct from your 'gross profit" to arrive at your "net profit" (as reported on line 135 of your income tax return.
Here is a sample I prepared a few years ago for eBay sellers. Feel free to modity it to your needs and use it:
http://pierrelebel.com/lists/P&L-sample.htm
The GST/HST do not show in the P&L as these numbers are handled in suspense accounts. In effect, the tax (GST or HST) you do not collect but remit to the government reduces your net profit accordingly.
If you sell $20,000 a year and 10% of your sales are in Canada ($2,000), you would need to remit about $200 HST/GST on those sales (rates vary by province but average almost 10% across Canada when selling from any province but QC).
I'm still unclear, how do you account for situations where you pay the GST/HST on behalf of the buyer?
I assume these are out-of-pocket costs for you, so do you group them as a line item (e.g. customer discounts) when reporting to CRA, or simply lump them in with some other category of expenses in your list of expenses?
The reason I ask is that the C.A. who initially set up my business included a line for "customer discounts at point of sale" that is deducted from total income before COGS is factored in.
"In effect, the tax (GST or HST) you do not collect but remit to the government reduces your net profit accordingly."
Now I'm confused. Isn't this equivalent to saying it's an expense (loss) to you when you pay the buyer's tax yourself and should be able to be claimed accordingly? Even if you consider the tax as part of the sale price, you'd be in effect discounting the listed price by the amount of the tax. Which I would think would be a loss/expense to you?
Maybe it's not worth all the trouble to register... 
KISS
You make life a lot more complicated than it is.
You worry too much about a small bookkeeping operation that does not really affect anything.
Reality is that whatever taxes (GST/HST) you remit but do not charge (a few hundred dollars at most) is in fact a reduction of your profit. It is absolutely irrelevant and does not change the final results if you look at it as a discount from revenues or as an expense. The results (money in your bank account) remain the same. CRA will accept whatever method of bookkeeping as long as you are consistent from one year to the next.
I spent many years training my adult students in bookkeeping. These days are behind me and I do not wish to do it again. Let your accountant guide you. It is not that complicated nor difficult.
And yes, GST/HST registration would most likely put hundreds of dollars in your pocket, year after year (more so for Canadian sellers living in NL, PE, NS, NB or ON).
One last question, if you don't mind. You mentioned: "GST/HST registration allows you to recoup ALL taxes paid through ITCs."
Wouldn't this refund of tax be effectively reduced by the total of the taxes I'd paid out on behalf of Canadian buyers (assuming I decide to absorb them)? In other words, I'd get all my tax paid back, but I would have also paid out money -- admittedly a lot less -- for those buyers.
On the other hand, if those tax payments on behalf of buyers were claimed as expenses, no loss would result.
Is this what you meant by "The GST/HST do not show in the P&L as these numbers are handled in suspense accounts.", i.e. they don't get factored into profits or losses either way?
Sorry -- that's 2 questions. 
"Wouldn't this refund of tax be effectively reduced by the total of the taxes...."
GST/HST works as follows:
1) calculate tax (GST or HST) payable on Canadian sales (rate varies by province). Assuming worldwide sales of $20,000 and sales to Canadians of $2,000, the total GST/HST payable would be about $200
2) add up all tax (GST or HST) paid on purchases of goods for resale (whether sold or not) and on all business related expenses. On $20,000 sales, purchases may approximate $10,000 on which $1.500 HST would have been paid. In addition, there could be expenses (fees, shipping costs, packing material, etc...) on which HST would have been paid. Let's say $2,000 at 15% = $300.
Final determination: tax payable $200 minus tax paid (ITCs) $1,800 = refund of $1,600
It is that simple. And yes I have been getting a GST/HST refund every year while I was GST/HST registered.
Typically, CRA calls when the first GST/HST report is filed asking for a refund. Once the seller explains that the bulk of the sales were exported. the CRA agent makes a note in the file so they will not call the following years.
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