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Travel services that will incur only 5% GST (after April 1, 2013):
Travel services that will incur 5% GST and 7% PST (after April 1, 2013):
For detailed list refer:
Ontario -- In Ontario, there is a uniform rate of 13% on all such services. On July 1, 2010 the 13 per cent Harmonized Sales Tax (HST) took effect in Ontario.
Since July 1, 2010, instead of paying 13 per cent sales tax to two governments (eight per cent to Ontario and five per cent to the federal government), there is one sales tax – still 13 per cent – collected by the federal government.
Further to your question, it would be applicable anyway, if you are selling to canadian residents / non residents or for that matter anyone. It will be applicable on "BOTH" of the scenario that you mentioned in your question.
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Thank your detailed answer. Can you please clarify.
We are tour operator that sells travel to Russia and Europe. We don't produce any goods in Canada itself, we are just selling service.
Our clients are Canadians, as well as international travelers from more then70 countries. For each of the bookings that are made, sales tax will apply?
For example, we offer an all inclusive cruise from Moscow to St. Petersburg, and it covers transportation, entrance fees, loging and meals. What sales tax will be due for that?
I actually think that your answer might nit be correct. There are a lot of agencies who work for commission of 10%, and obviously they cannot pay 13% sales tax. They don't charge their customers ether, as we always sell only one set price with no add on taxes. Please advice, how they avoid paying these tax.
non service does not originate from Canada, and, these are big and small agencies, like Carlson vagonlit, and I'm sure they are nit avoiding taxes.
I double checked with customers as well. They do not pay additional sales tax. So how canxthey be receiving 10% commission, paying 13% sales tax on whole amount?
surely, they don't pay it. If not, what form of business registration, or travel agent status is needed to about it? Our lawyer in Canada told that from his,knowledge sakes,tax is,not paid ether. May be specific provinces?
Thank you, but no, it didn't help.
Here is a simple scenario. We are an american company, and we sell 1 complete all inclusive price, no additional taxes.
Our canadian customers are coming to us via agent, and buying service for complete price, and agent receiving commission.
So, for example, sales price is $1000. Customer paying agent $1000 as well. Agent received $100 from it as a 10% commission. Obviously, he cannot pay 13% or $130 in sales tax. We are sure that customers also not paying additional $130 on top of $1,000.
This is a common agent commission practice that happening all the time from small to big agencies, and surely they are not avoiding tax.
Particularly, it does not also seems right that 13% tax should be paid at all. Because, all travel industry mark ups are less then that, and usually agencies have 10-12% mark up on services.