PST / GST Questions

[gezeilstra]

Hi
I know that this is a big subject, just wondering if some of you sellers with experience in this could clear up a few questions:
1. I think that GST does not have to be charged if you don't have a GST # - which is allowed if your revenue is under $35K per year - correct?
2. Does PST have to be applied to Ebay sales, especially used items? Is it just to sales within your province, or ????
3. Are there monthly or quarterly reports that have to be submitted on taxes, even if you're not charging them?
4. Any advantage to having a GST # even if your revenue is under the 35K? Does GST apply to US sales?

Any info you could help with would be much appreciated!

[shoplineca]

gezeilstra
The limit for GST is $30,000/yr (I believe) however you are paying GST on everything you buy in Canada so why wouldnt you want to get credit for it. As an example, if Iyou pay GST on all your purchases and 1/2 of what you sell goes to the US, you will get that GST back. You also get back the GST on things you purchase to operate your business and other expenses where GST is applied (like with CP, UPS or Fedex).

You are required to have a Provincial Vendor's Permit which becomes your PST number. You are required to report all sales as income whether you register as a sole proprietorship. a partnership or incorporate.

I think the easiest way to define or decide whether you should declare and report income is this: If you are a Power Seller, you should be registered Federally and Provincially and declare all revenues.

You can make an election to file your GST twice per year if you wish, or quarterly or monthly. PST is twice per year.

Tax and Reveinue laws make no distinction between selling new or selling used, nor whether you are selling part time or full time. You are selling for a profit and you must declare your income.

Malcolm

[muminlaw]

I'd just like to add that the $30,000.00 per year, is total sales - not profit, and not just sales within Canada!

Glenda

[ospreylinks]

We remit PST monthly, not bi-yearly.

PST is applicable to same province sales only. (ie if you reside in ON, you must charge PST on sales within the province, but goods shipped outside of ON are PST exempt). You must be able to prove the goods left the province, hence maintain the shipping manifests. Unless you live in Alberta, King Klein has abolished sales taxes in his kingdom..... long live the King!

GST is applicable across the country, but is not charged on goods leaving the country....

In terms of selling used goods. Are you buying these used goods specifically for resale or are you selling your personal possessions. If you went to the PST people and told them you were selling only personal effects, I don't think they would expect you to collect PST, however you can only play this card so long......

Good luck!

Jeff

[shoplineca]

Jeff
When one pays PST (how often) is based on sales volume. For some reason, my last remittance covered about 8 months, the one before that 6 months and the one before that about 3 months. If you operate a retail store, I believe that you are expected to report and remit monthly but I know that varies even in the restaurant and bar business.

I think a good rule of thumb is, if you are selling sufficient quantities to be a Power Seller then it is probably safe to assume you are running a business and should be reporting your sales.

If you sell personal items as well as used ones you purchase tfor re-sale, you should either set up a different user id or keep clear records, well documented as to ownership.

Besides, there is nothing wrong with selling personal items. Lets face it, that stereo you bought in 1980 for $800 just sold for $25 on eBay so that would be a handsome business loss in my books. (Sorry I dont depreciate personal belongings).

When purchasing at garage sales or at flea markets, take along a receipt book and have the vendor complete it for you or just complete it yourself, noting where you made the purchase, the date and what you paid.

Remember, you can deduct your expenses for travelling to the flea market and other items as well (such as a portion of your home costs) so it can be a bonus for your business to become legitimate.

Malcolm

[shoplineca]

gezeilstra
Most of the Provinces team up with Revenue Canada and put on free seminars throughout the various Provinces from time-to-time.

I have a list of all the Ontario seminars taking place this Fall and into winter however as you are in Manitoba, why dont you call your PST office and ask if they are giving any of these in Winnipeg in the near future and get yourself on the list to be invited.

Malcolm

[gezeilstra]

I will do that , thanks.
I have registered my business (Ebay sales & some computer consulting), so that is not the issue, but started back in mid-May (as a business) and have not really addressed tax issues with everything else going on, I guess I better get on that!

My in-province sales have been very slight, so any PST due I can just pay out myself, but looks like I better figure out some of these details moving forward!

I've also documented everything, but have not set up an accounting system yet, anyone have a sample Chart of Accounts for an Ebay seller ? 🙂

[itrecovery]

There no such thing as GST in Atlantic provices. You should charge HST and report it as GST.

[rlrdist]

in quebec we do the following:

Quebec = 7%GST + 7.5%PST
BC/AB/SK/MB/ON = 7%GST
Maritimes = 15%HST

[muminlaw]

rlrdist -- you should add PEI to the 7% GST and not include it with the Maritimes - PEI opted out with the rest of the country when the harmonized was offered!

Glenda

[shoplineca]

rlrdist
You shouldnt be charging PST for BC/AB/SK/MB/ON as you arent located there and the goods arent being sold from there or shipped from any of those Provinces.

You have to have a Provincial sales license from each of those provinces to charge, collect and remit sales tax and that is only if you have a business operation in that province and are selling from that province into that province otherwise you ship into those provinces only charging the GST.

Malcolm

[muminlaw]

Malcolm, I think you read rlrdist's post too fast! He's charging GST + PST only in Quebec, and GST or HST to the rest of the country.

Glenda

[shoplineca]

Actually Glenda I think I am hallucinating.
We had a big snowfall and I fell down 8 steps at someone's house and havent come close to recovering from it yet.

I ache in places I didnt think I had and my head either is still dizzy because I hit it on the steps or just because of the shock of the fall.

Despite that I managed to get my instruments packed and shipped out this afternoon.

Hot shower in a while should fix things up.

Malcolm

[muminlaw]

Sheesh Malcolm, a hot shower, a hot toddy, and straight to bed! (either that or you have to stay awake all night in case you're concussed!)

I read somewhere recently that when things get slippery, golf shoes (or boots) are probably the safest footwear to keep your footing!

(There's an idea for a promotion for you Jeff!)

Glenda

[shoplineca]

Glenda
Yeah I guess cleats make alot of sense in winter.

I wore my running shoes (dumb) and the guy hadnt shovelled his stairs (dumber).

I heard the safest way for sure footing in the winter is BARE FEET!!!!!

Yup, thats right bare feet, on a warm tropical beach with a palm tree overhead, a drink in your hand and rent paid on a vacation villa until the snow melts.

Malcolm

[muminlaw]

There you are! Sounds like advice to COME TO VICTORIA!!!! Not quite - it's getting close to freezing here (not quite barefoot weather) and some of the locals are heading for Hawaii for a quick break.

Glenda

[shoplineca]

Thats what I miss about living in BC. The short trips to Hawaii.

I first flew out of Vancouver to Hawaii in 1975, a short 3 1/2 hour flight or so. I flew back there in 1986 but it took a full day. Drove 4 1/2 hours from Ottawa to Toronto. Flew Toronto to Edmonton then Edmonton to Vancouver and then Vancouver to Hawaii (that was a Wardair charter). But for $299 per person, it was a deal.

Malcolm

[muminlaw]

Oooohhhh, I remember Wardair charters - they treated you like valued customers and the service was superb! My first trip to London was on a Wardair charter (can't remember the cost) and the hardest part of the trip was getting from Gatwick Airport to Victoria Station.

We were booked at a small hotel in Earl's Court (Kangaroo Valley at that time) and nearby we found one of the last fish & chip shops in London that actually did fish & chips right! We ate there almost every other day it was so good. Friends took us to Stone's Chop House and to Rules for gourmet dinners, but the High Tide Plaice & Chips was our favourite! I can almost taste it now and I think I've gained a couple of pounds just thinking about it!!

Glenda

[shoplineca]

Glenda
My most merorable Wardair flight (and I took lots and lots of them) was a trip to Barbados where I was going with one of my cousins and a good friend back in 1974.

There were only about 109 of us to board a Boing 727 in Montreal when we were informed that because there were 300+ vacationers in Barbados scheduled to return, we were to travel in a 747, fully staffed with booze and food for several hundred.

Well the stewardesses had whistles and party favours and we all danced in the asiles, slid down the banister from the upstairs lounge and wanted to stay on board when we landed rather than vacation in a villa that we rented.

My cousin, who is still trim at 52, ate 3 full meals on that flight just because he could!

Oh to be young, single and foolish again.

Malcolm

[rlrdist]

Glenda,
thanks for the heads up for PEI. i just had 3 sales there yesterday guess I can redo the invoices now 🙂

Malcolm,
boots help when the snow starts, i almost killed myself yesterday going to drop off parcels.