The quick answer
If you sell on Shopify from Canada and your total worldwide taxable revenue is $30,000 or more over any four consecutive calendar quarters, you must register for GST/HST with CRA. Below that threshold you are a "small supplier" and registration is optional — though many Shopify sellers register voluntarily so they can claim Input Tax Credits on Shopify fees, ad spend, packaging, and inventory.
Once registered, you charge the GST/HST rate of the buyer's province (not yours), file quarterly or annually, and remit the net tax — what you collected minus what you paid in eligible business expenses (ITCs). Quebec sellers and sellers into Quebec also deal with QST as a separate provincial tax.
Shopify's built-in tax engine handles the rate-by-province calculation automatically once you toggle it on and enter your registration numbers. The hard part is not the math — it is knowing when to register, what to set up, and what you can claim back.
Step 1: Figure out if you need to register
The trigger is $30,000 in worldwide taxable revenue over four consecutive calendar quarters — not a tax year, not a calendar year, but a rolling 4-quarter window.
"Taxable revenue" includes most Shopify sales (physical and digital goods, services) but excludes exempt items (basic groceries, prescription drugs, most financial services, residential rent).
The day you cross $30,000, you are no longer a small supplier. You must register and start charging GST/HST on the supply that put you over the threshold — and on every supply after that.
Common Shopify-specific situations:
- Selling internationally: Worldwide revenue counts toward the $30,000 test, but sales to non-Canadian customers are usually zero-rated (0% GST/HST). You still report them on your return.
- Crossing $30K mid-year: Register immediately — do not wait until year-end.
- Multiple Shopify stores: Revenue is combined under your CRA Business Number, not split per store.
Step 2: Should you register voluntarily before $30,000?
Yes, for most ecommerce sellers. The reason is Input Tax Credits (ITCs) — once registered, you can claim back the GST/HST you paid on business expenses. Common Shopify-related ITCs:
- Shopify subscription fees (Basic, Shopify, Advanced, Plus)
- Shopify Payments processing fees
- App subscriptions (Klaviyo, ReConvert, Vitals, etc.)
- Meta and Google ad spend billed in Canadian dollars with GST/HST
- Packaging, shipping supplies
- Wholesale inventory purchased from Canadian suppliers
- Software (Adobe, Canva, accounting tools)
- Contractor invoices for design, content, or freelance work
If you spend $1,500 a month on these and pay 5% GST or 13% HST on most of it, you could be claiming back $75 to $200 monthly in ITCs. Once that exceeds the admin overhead, voluntary registration pays for itself.
The trade-off: you have to charge GST/HST on Canadian sales from day one, even on small orders. Some new sellers feel this puts them at a price disadvantage. In practice, Canadian customers expect to see tax — the bigger psychological barrier is usually shipping cost, not tax.
Step 3: How to register
Registration requires a CRA Business Number (BN) with an RT suffix for GST/HST. You can register online, by phone, or by mail.
The fastest route is Business Registration Online (BRO) through the CRA website. You will need:
- Legal name (your name or your corporation's name)
- Business activity description
- Estimated annual revenue
- Effective date of registration
- Reporting period preference (annually, quarterly, or monthly)
CRA assigns your default reporting period based on revenue:
- Under $1.5M annually: Annual filing (default)
- $1.5M to $6M: Quarterly filing
- Over $6M: Monthly filing
Most new Shopify sellers default to annual filing. You can opt into a more frequent schedule if you prefer steady cashflow rather than one large annual remittance.
For a full breakdown of registration mechanics, see our GST/HST registration guide for Canadian small businesses.
Step 4: What rate do you charge each buyer?
This is where Shopify sellers get confused. The rate depends on where the buyer is (place of supply), not where you are.
Current 2026 rates by province:
- GST only (5%): Alberta, Northwest Territories, Nunavut, Yukon
- GST + PST/RST: BC (5% + 7%), Saskatchewan (5% + 6%), Manitoba (5% + 7%)
- GST + QST: Quebec (5% + 9.975%)
- HST (combined federal + provincial): Ontario 13%, New Brunswick 15%, Newfoundland & Labrador 15%, Nova Scotia 14%, PEI 15%
For Shopify sellers, this means:
- Selling a $50 item to an Ontario buyer: charge $50 + $6.50 HST
- Selling the same item to an Alberta buyer: charge $50 + $2.50 GST
- Selling to a Saskatchewan buyer: charge $50 + $2.50 GST (plus $3.00 SK PST if you are registered provincially — more below)
- Selling to a US or international buyer: charge $50 + $0 (zero-rated export)
Always verify the current rate on the official provincial tax authority page before configuring Shopify — Nova Scotia adjusted its HST rate in 2025, and others may shift again.
Step 5: The PST layer (BC, SK, MB)
GST/HST is federal. Provincial Sales Tax (PST) in BC, Saskatchewan, and Manitoba is separate — and Shopify sellers shipping into those provinces may also need to register provincially.
The registration tests vary — and Saskatchewan in particular is a trap that catches a lot of Shopify sellers:
- BC PST (7%): Out-of-province sellers must register when their gross revenue from BC customers exceeds $10,000 in any 12-month period, or where they have a physical presence in BC. In effect since April 2021.
- Saskatchewan PST (6%): No threshold. SK requires out-of-province sellers (physical goods or digital products) to register and collect PST from the first sale to a Saskatchewan customer. There is no small-seller exemption for non-residents. If your Shopify store ships into SK, you should be registered.
- Manitoba RST (7%): For physical goods, out-of-province sellers register when sales delivered into MB exceed $30,000 in a 12-month period. For digital products and SaaS, registration is required from the first B2C sale — no threshold.
Each province has its own filing portal and frequency. PST is collected on top of GST — they are not combined like HST.
If you sell physical products from a Shopify store and ship across Canada, expect to register for at least GST/HST and likely one or more provincial sales taxes within your first year of meaningful revenue.
Step 6: Quebec QST
Quebec's sales tax is administered by Revenu Québec, not CRA. If you sell goods or services to Quebec customers and your taxable supplies into Quebec exceed $30,000 over 12 consecutive months, you must register for QST.
QST rate: 9.975%. It is charged on top of GST (5%) — so a $50 item shipped to a Montreal buyer costs $50 + $2.50 GST + $4.99 QST = $57.49.
QST registration is separate from GST/HST. You file QST returns with Revenu Québec on their schedule, which is similar to but not always identical to CRA's GST/HST schedule.
Step 7: Set up Shopify Tax
Once you have your registration numbers, you turn on automatic tax collection in Shopify:
- Shopify Admin → Settings → Taxes and duties → Canada → Manage.
- Enter your GST/HST registration number.
- Add each province where you have a tax obligation, with the appropriate provincial registration number.
- Choose whether tax is included in your prices or added at checkout. Most Canadian Shopify sellers add tax at checkout (the B2C convention).
- Toggle on Charge tax on shipping if you ship taxable goods (most do).
Shopify will then automatically calculate the right rate based on the shipping address at checkout, including the GST/HST + PST stack for BC, SK, MB and the GST + QST stack for Quebec.
For more complex situations (digital products, US sales tax, marketplace rules), consider Shopify Tax (the paid add-on) or third-party apps like Avalara AvaTax or TaxJar Canada.
Step 8: Filing GST/HST returns
The mechanics of filing:
- Pull a tax report from Shopify for the filing period (Settings → Taxes and duties → Reports, or use a third-party app for cleaner exports).
- Add ITCs — the GST/HST you paid on business expenses during the same period.
- Net the difference — collected minus ITCs.
- File on CRA My Business Account (or through your bookkeeper).
- Pay any net tax owed by the deadline.
Annual filers have three months after their fiscal year-end to file and pay (corporations). Sole proprietors with a December year-end have until June 15 to file but tax owing is due April 30. Quarterly and monthly filers pay one month after the period ends.
Missing the deadline triggers interest plus a late filing penalty (1% of the amount owing plus 0.25% per month it remains unfiled, up to 12 months).
Input Tax Credits — the part most Shopify sellers miss
ITCs are only claimable on the GST/HST portion of business expenses, but they add up fast for ecommerce. For a typical Canadian Shopify seller doing $200,000 a year in revenue, ITCs commonly recover $2,000 to $6,000 annually depending on cost structure.
What to track for ITC purposes:
- All Shopify-billed fees (subscription, transaction, Shopify Payments)
- All app and software subscriptions
- Ad invoices (Meta, Google, TikTok — only the Canadian-billed portion with GST/HST shown)
- Inventory from Canadian suppliers (international purchases use a different rule called import GST)
- Packaging, fulfilment supplies, shipping (where GST/HST is charged)
- Contractor invoices that show GST/HST
- Professional services (legal, accounting, design)
Keep digital copies of every invoice. CRA can request documentation for ITCs up to four years back during a review.
Common mistakes Shopify sellers make
Treating Shopify as a marketplace facilitator. Shopify is a SaaS platform — your store, your tax obligation. CRA does not consider Shopify a marketplace facilitator that collects on your behalf (unlike Amazon FBA or Etsy in some scenarios, where the platform collects and remits). You are responsible for collecting and remitting your own GST/HST.
Charging your home province's rate to everyone. Common rookie mistake. The rate is the buyer's province, not yours. A BC-based seller charges 13% HST to an Ontario buyer.
Forgetting Quebec QST. Quebec is a separate filing with Revenu Québec. If you ship into Quebec regularly, you likely cross the QST threshold without realising it.
Skipping ITC tracking. Every Shopify subscription invoice, app invoice, ad invoice, and supplier invoice with GST/HST on it is an ITC opportunity. Not tracking them is leaving money on the table.
Mixing personal and business expenses. ITCs are only claimable on business expenses. If Shopify Payments deposits go into a personal account and a personal Visa pays the Shopify subscription, untangling at year-end is painful. Use a dedicated business bank account and credit card from the start.
Frequently asked questions
Does Shopify collect and remit GST/HST for Canadian sellers?
No. Shopify is a SaaS platform, not a marketplace facilitator under Canadian GST/HST rules. You are responsible for collecting and remitting your own tax. Shopify's tax engine calculates the right rate at checkout — but you file and pay.
Do US Shopify sellers shipping into Canada need to register for GST/HST?
Possibly. Non-resident sellers with annual sales to Canadian buyers exceeding $30,000 generally need to register under the cross-border rules introduced in July 2021. The specifics depend on whether you sell tangible goods, digital products, or services. Check with a tax accountant familiar with non-resident GST/HST.
What if I only sell internationally from my Shopify store?
You may still want to register voluntarily to claim ITCs on Canadian business expenses (Shopify fees, ad spend billed in CAD, etc.). Your sales themselves are zero-rated (0% on exports), so you would file mostly to recover ITCs.
How does Shopify Tax compare to manually calculating GST/HST?
Shopify's built-in tax engine handles GST/HST automatically once configured, and it is available to Canadian sellers on all paid Shopify plans. Shopify Tax (the paid add-on) adds advanced US sales tax features, but the Canadian basics are handled by the standard tax engine.
Can I deduct Shopify fees from GST/HST owed?
Yes — Shopify subscription fees and Shopify Payments processing fees are business expenses with GST/HST charged on them. The GST/HST you pay on those invoices is claimable as an Input Tax Credit, reducing what you owe CRA.
Selling on Shopify in Canada and not sure if you are doing tax right?
We help Canadian ecommerce sellers register for GST/HST, configure Shopify Tax, and reconcile Shopify payouts every month — including ITC tracking that most sellers miss. Book a 30-minute call and we will look at your store, your revenue, and your setup, and tell you honestly where the gaps are. If you want the broader picture, see our ecommerce bookkeeping page.