Does a business have to charge tax?
Sarah Duran
Published Apr 24, 2026
Most businesses in Canada have to collect the goods and services tax (GST) or the harmonized sales tax (HST). (There is no provincial sales tax in Alberta or in the three territories.)
Do you have to pay taxes if you don’t charge taxes?
If you purchase a taxable item and the seller did not charge sales tax, you are obligated to pay use tax to the state where the item is used. If sales tax is not charged on the sale of a taxable item, then use tax is due.
Do I need a GST number for my small business?
It may seem that all small businesses should immediately get a GST/HST number, but it really depends on the business. If your business has revenue in excess of $30,000 in four consecutive calendar quarters, you have to register for a GST/HST number.
How to charge your customers the correct sales tax rates?
In these states, you charge sales tax based on the rate at your customer’s location (that is, their “ship to” address). This also most often the case for remote sellers in the states when you have nexus. More on this later. Example: You operate your business out your warehouse in Stamford, NY, and sell an item to someone in Buffalo, NY.
Do you have to charge sales tax on all sales?
If you are considered a “remote seller” in an origin-based state, you’ll probably be required to charge sales at the total combined sales tax rate of your customer’s location.
Can a state compel a business to collect sales tax?
A state cannot compel a business to register or to collect sales tax unless it has established a physical presence within the state, known as a “nexus.” An office, store or other business facility is located in the state. The owner or employees enter the state to take orders, perform services or otherwise do business.
Do you have to charge sales tax to ship products?
When it comes to shipping products, some states are origin-based sales tax states and some are destination-based sales tax states. This can also affect whether or not you charge tax, and how much you charge. Where you live can have a huge impact on what you charge.
