Cascot

I'm hoping somebody may have some experience in this area.

I am a Canadian resident currently living in Ontario and I am now carrying out contract work for a UK based business. This work involves consultancy services, technical support of existing software systems, and development of new software systems.

My question is, should I be charging PST and / or GST on my invoices?

I have read some of the documentation from the government website, but it is not exactly clear. They offer examples, but the fact that they don't specifically list the type of work I am doing leaves me uncertain.

Thanks for taking the time to read this far.

JonboyE

It depends where the place of supply is. For goods and most services this is not difficult to determine. IT services are more difficult. Anything that you do for a UK company that will be used only in the UK will be zero rated for GST, and probably (I don't know which province you are in) not a taxable supply for PST. If the services are being used in Canada you should collect GST. If they are being used in your province you should probably collect PST - but this is a complex area. It is different if you are considered to be providing labour only, or a complete service.

Your best bet is to call CRA and your local PST people and ask.

Ben W Bell

Be aware though that I believe under EU legislation brought in a couple of years ago, if they are paying you in the UK for services and even if you are overseas they still need to pay VAT on it, so VAT needs to be charged. I'm not sure if this will apply to this case, but you'd need to check it.

Cascot

Thanks Ben & JonboyE for your replies.

I'm in Ontario Jon. It was in my original posting, but easy to miss.

I think it would be best as JonBoyE suggested to contact the CRA directly. The difficulty there is deciding which of the 100 phone numbers to call :-)

I would assume that if I purchase an actual product here in Ontario and charge it on to the UK company I am working for, that I would have to pass it on to them NET of GST as I will get that back from the government?

I will try to check into the VAT situation, though as I'm not registered for VAT I don't see how anyone could be liable to pay it, who would they pay it to?

JonboyE

Opps You need to talk to the Ontario PST people. I only know BC.

I would start by calling your local tax service centre

That is sort of how it works, assuming you are registered for GST. You reclaim the GST on your inputs. You must charge GST on your outputs (sales) but the rate you use depends on the place of supply. If you send the goods to your UK customer then you charge GST at 0% (i.e. nothing), but you should keep proof of export in case of an audit. However, if you use the goods in Canada you should charge your UK customer GST at 6%.