Place of Supply Rules for Canadian Sales Tax — Your Questions Answered
Short version first: what province taxes a sale is usually about where your customer receives the good or service, rather than where your business is registered. The rest of this is the detail behind that answer, and where it gets complicated.
The Ontario-to-Alberta example
Which province’s tax do I charge a client elsewhere in Canada? The general principle behind place of supply rules for Canadian sales tax is that tax follows the customer’s location. If you’re operating out of Ontario and sell to a client in Alberta, you don’t simply default to charging Ontario’s rate because that’s where you’re based — the destination matters. The exact mechanics differ depending on whether you’re selling goods, services, or something digital, which is where a rule of thumb stops being enough.
The actual provincial rates
The specific worry people raise is: do I charge HST to a client in Alberta? No — Alberta has no provincial sales tax layered on top of GST, charging 5% GST only, with no HST. A client billed correctly for a supply delivered to Alberta should see 5%, rather than the 13% HST charged to an Ontario client. The rates themselves, as at 2026: 5% in Alberta, Yukon, NWT and Nunavut; 12% combined in BC and Manitoba; 11% in Saskatchewan; 13% HST in Ontario; 14% HST in Nova Scotia, cut from 15% in April 2025; 15% HST in New Brunswick, Newfoundland and Labrador and PEI; close to 15% in Quebec once its provincial QST is added to GST.
Where it gets genuinely complicated
Naturally, how does place of supply work for services, and is that harder than goods? Yes, meaningfully — a service doesn’t physically cross a border the way a shipped product does. Where a client is located, where the service is performed and where the benefit is received can point in different directions for a remote consulting or freelance arrangement. This is worth taking to a Canadian accountant rather than settling for a general rule; the “tax follows the customer” principle holds, but the specific rules for services carry enough edge cases that a wrong guess can mean remitting the wrong province’s tax for months before anyone catches it.
Shipping goods across provincial lines
On the goods side: what tax applies when you ship goods to another province? For physical goods, the delivery destination is usually the anchor point — where the goods end up, rather than where your business or warehouse sits. Treat that as the shape of the rule rather than something to apply confidently to your specific product and shipping arrangement without checking current CRA guidance.
The one-line answer worth remembering
Do you use your rate or the customer’s rate? As a working rule, the customer’s province decides it. If you’re a South African newcomer setting up a small consulting practice or an online shop and this is load-bearing for your invoicing, get it confirmed by a Canadian accountant against your specific business type before you build a billing system around an assumption.
Getting the province wrong on tax collected is more than a small clerical slip — it’s the kind of thing that surfaces at reconciliation time, usually later than you’d like.
Our What It Really Costs guide breaks down the tax landscape newcomers actually budget against, sales tax included, province by province.