spb/air Public MIT

1<!--2Project : AIR — Accounting Intermediate Representation3Author : Simon-Pierre Boucher4Contact : contact@spboucher.ai5File : canada-gst-qst.md6-->78# Canadian Sales Tax Rules — GST / QST (Focus: Quebec)910**Research date (all sources consulted): 2026-08-05**11**Status: rates and rules verified against official government sources (CRA / canada.ca, Revenu Québec, Justice Laws Canada).**1213This document is the citable source required by CLAUDE.md §1 before coding any tax rule.14Per project rule §5.6, none of these rates may be hardcoded in the engine — they belong in15versioned ALSL policies, with this document as the cited source.1617---1819## 1. Current rates (verified 2026-08-05)2021| Tax | Rate | In effect since | Official source |22|---|---|---|---|23| GST (federal Goods and Services Tax) | **5%** | January 1, 2008 | Revenu Québec, "Tables of GST and QST Rates" [1]; CRA rate table [2] |24| QST (Quebec Sales Tax) | **9.975%** | January 1, 2013 | Revenu Québec, "Tables of GST and QST Rates" [1]; CRA rate table [2] |25| Combined effective rate in Quebec | **14.975%** | January 1, 2013 | Revenu Québec, "Calculating the Taxes" [3] |2627Historical GST rates (for processing back-dated documents): 7% (1991-01-01 to 2006-06-30),286% (2006-07-01 to 2007-12-31), 5% (2008-01-01 to present). Historical QST rates: 6.5%29(1994-05-13 to 1997-12-31), 7.5% (1998 to 2010), 8.5% (2011), 9.5% (2012), 9.975%30(2013-01-01 to present). Source: [1].3132- [1] https://www.revenuquebec.ca/en/businesses/consumption-taxes/gsthst-and-qst/basic-rules-for-applying-the-gsthst-and-qst/tables-of-gst-and-qst-rates/ (consulted 2026-08-05)33- [2] https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/gst-hst-businesses/charge-collect-which-rate.html (consulted 2026-08-05) — table lists Quebec: GST 5%, PST(QST) 9.975%34- [3] https://www.revenuquebec.ca/en/businesses/consumption-taxes/gsthst-and-qst/collecting-gst-and-qst/calculating-the-taxes/ (consulted 2026-08-05)3536## 2. QST calculation base (relative to GST)3738**Confirmed: since January 1, 2013, the QST is calculated on the selling price NOT including39GST.** GST and QST are both computed on the same pre-tax base. Revenu Québec's official page40"Calculating the Taxes" [3] describes the two accepted methods:4142- **Two-step calculation**: compute 5% GST on the sale price, then compute 9.975% QST *on the43  same sale price* (not on price + GST).44- **One-step calculation**: apply a single combined rate of **14.975%** to the sale price.4546Both methods yield the same total. (Before 2013 the QST was applied on the GST-included price;47that regime is obsolete and must never be used for current documents.)4849Cash-register tolerance (from [3]): the 9.975% rate may be rounded to 9.97% (and 14.975% to5014.97%) **only** if the cash register cannot process three-decimal rates. AIR/AIC uses exact51decimals, so this tolerance must NOT be used — always 0.09975 / 0.14975.5253Combined effective rate: 5% + 9.975% = **14.975%** of the pre-tax price.5455## 3. Rates across Canada (for completeness)5657From the CRA official table "Charge and collect the tax – Which rate to charge" [2],58consulted 2026-08-05:5960### HST participating provinces (single harmonized tax, replaces GST + provincial tax)61| Province | HST rate | Notes |62|---|---|---|63| Ontario (ON) | **13%** | |64| Nova Scotia (NS) | **14%** | **Decreased from 15% on April 1, 2025** (provincial portion cut to 9%). Transitional rules: GST/HST Notices 342 and 343 [2a] |65| New Brunswick (NB) | **15%** | |66| Prince Edward Island (PE) | **15%** | |67| Newfoundland and Labrador (NL) | **15%** | |6869### GST only (5%)70Alberta (AB), Northwest Territories (NT), Nunavut (NU), Yukon (YT).7172### GST + separate provincial sales tax (provincial tax NOT federally administered)73| Province | GST | Provincial tax |74|---|---|---|75| Quebec (QC) | 5% | QST 9.975% (value-added, administered by Revenu Québec) |76| British Columbia (BC) | 5% | PST 7% |77| Saskatchewan (SK) | 5% | PST 6% |78| Manitoba (MB) | 5% | RST 7% |7980- [2a] Nova Scotia transition: https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/notice342.html and .../notice343.html (linked from [2], consulted 2026-08-05)8182Administration note: under a federal–Quebec agreement, **Revenu Québec administers the GST/HST83in Quebec** on behalf of the CRA; Quebec businesses register and file with Revenu Québec for84both taxes. Source: https://www.revenuquebec.ca/en/businesses/consumption-taxes/gsthst-and-qst/basic-rules-for-applying-the-gsthst-and-qst/ (consulted 2026-08-05).8586## 4. Place-of-supply rules (which province's tax applies)8788Official source: CRA, "GST/HST rates and place-of-supply rules" [4], consulted 2026-08-05.89Detailed technical references: GST/HST Memorandum 3-3 (Place of Supply) and Technical90Information Bulletin B-103.9192- **Zero-rated supplies** (e.g. basic groceries, prescription drugs, exports): 0% GST/HST93  regardless of place of supply anywhere in Canada.94- **Goods (tangible personal property) sold**: the place of supply is the province where the95  goods are **delivered or made available** to the recipient (legal delivery per the96  agreement). If the supplier ships the goods or arranges shipping to an address in another97  province, delivery is considered to occur in that destination province. CRA example: a BC98  store delivering a mattress to a customer in Ontario charges 13% ON HST. If goods are sold99  with agreed delivery to an address but never delivered, the place of supply is the province100  where delivery was supposed to occur.101- **Goods leased** (> 3 months): each lease interval is a separate supply; specific rules per102  interval. Short leases (≤ 3 months): generally where the goods are provided (CRA example:103  camera rented in Nova Scotia → NS HST even if used across Canada).104- **Services — general rules** (apply unless a specific rule overrides):105  1. **Rule 1**: place of supply is the province of the **recipient's address** obtained by106     the supplier in the normal course of business (e.g. Quebec supplier designs a website for107     an Ontario company → ON HST 13%).108  2. **Rule 2a**: if no address is obtained and the Canadian part of the service is NOT109     performed primarily (> 50%) in participating provinces → the non-participating province110     where performed (GST only, plus QST if Quebec).111  3. **Rule 2b**: if performed primarily in participating provinces → the participating112     province with the largest proportion of the service.113  4. **Rule 2c**: tie between participating provinces → the one with the highest HST rate.114- **Specific overriding rules** exist for: services related to real property (province where115  the property is located), personal services, transportation, telecommunications,116  computer-related services/Internet access, air navigation services, specified motor117  vehicles (province of registration), etc. See [4] for the full list — implement these as118  ALSL policies per category, not in the engine.119- **QST side**: the QST applies to supplies **made in Quebec** under mirroring place-of-supply120  rules in the Quebec Sales Tax Act; Quebec GST/HST registrants must charge HST on their sales121  made in participating provinces (Revenu Québec, "Basic Rules", consulted 2026-08-05).122123- [4] https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/gst-hst-businesses/charge-collect-place-supply.html (consulted 2026-08-05)124125## 5. Rounding rules (fractions of a cent)126127**Statutory rule — Excise Tax Act, s. 165.2 (verified directly on Justice Laws, 2026-08-05) [5]:**128129- **s. 165.2(2)**: where the tax payable includes a fraction of a cent, the fraction,130  **if less than half a cent, may be disregarded**; **if equal to or greater than half a cent,131  it is deemed to be one cent**. (Round-half-up at the cent, per tax amount.)132- **s. 165.2(1)**: when two or more taxable supplies at the same rate appear on one invoice,133  the tax **may be calculated on the total consideration** (i.e., compute tax once on the134  invoice subtotal, then round — instead of rounding line by line).135136**Revenu Québec guidance — publication IN-203-V, "General Information Concerning the QST and137the GST/HST" (current version 2026-03) [6][6a]:** identical rule for both taxes: "Only138fractions equal to or greater than one-half of a cent ($0.005) are counted as a whole cent139($0.01) of sales tax. If more than one good or service is being sold, you can calculate the140taxes on the total price of all the goods or services purchased before rounding off the141fractions."142143**Cash rounding (penny elimination)** is a separate, later step: only the **final cash total144after GST/HST is calculated** is rounded to the nearest $0.05; electronic/cheque payments145settle to the cent, and tax is always computed on the pre-rounding price (Government of146Canada, Budget 2012 "Eliminating the Penny" [7]).147148**Decision for AIR/AIC**: compute tax in exact decimal (no floats), round each tax (GST, QST)149to the cent with round-half-up, at the invoice-total level by default (s. 165.2(1)), with a150per-line option; model cash rounding as a distinct posting line, never inside tax calculation.151Note: this statutory rule is round-HALF-UP, not banker's rounding — the CLAUDE.md §4 mention152of banker's rounding must NOT be applied to Canadian GST/QST.153154- [5] https://laws-lois.justice.gc.ca/eng/acts/E-15/section-165.2.html (consulted 2026-08-05)155- [6] https://www.revenuquebec.ca/en/online-services/forms-and-publications/current-details/in-203-v/ (consulted 2026-08-05 — confirms current version 2026-03)156- [6a] Wording quoted from the IN-203-V publication text as retrieved via a mirrored copy of the official Revenu Québec PDF (ryan.com/contentassets/.../qc-in-203-v.pdf, consulted 2026-08-05). See "flags" in §8.157- [7] https://www.budget.canada.ca/2012/themes/theme2-eng.pdf (consulted 2026-08-05)158159## 6. Registration — small supplier threshold160161**Confirmed from Revenu Québec's official information site (2026-08-05) [8]:** a business must162register for the GST/HST and QST as soon as its sales of taxable goods and services (including163zero-rated sales) **exceed $30,000 in a single calendar quarter or total $30,000 over the past164four calendar quarters**. The calculation includes worldwide taxable and zero-rated sales,165including those of associates, and excludes GST/HST and QST amounts, financial services,166sales of capital property, and goodwill. Below that threshold, a "small supplier" is generally167not required to register (special rules exist, e.g. taxi/ride-sharing operators must register168regardless).169170Once registered: collect both taxes, file returns (usually combined GST-QST in Quebec), and171claim **input tax credits (ITCs)** for GST and **input tax refunds (ITRs)** for QST paid on172business inputs [8].173174- [8] https://justepourtous.revenuquebec.ca/en/profiles/self-employed-workers/ (Revenu Québec official "Fair for all" site, consulted 2026-08-05); also covered in IN-203-V [6]. CRA reference page: "When to register for and start charging the GST/HST" (canada.ca) — see flag in §8.175176## 7. Worked example — taxable sale of 1,000.00 CAD in Quebec (CA-QC)177178Rates: GST 5% (0.05), QST 9.975% (0.09975), both applied on the pre-tax price (§2).179Rounding: half-up to the cent per ETA s. 165.2(2) (§5).180181```182Subtotal (pre-tax)            :  1,000.00 CAD183GST  = 1,000.00 × 0.05        =     50.00000 → rounds to  50.00 CAD (exact, no fraction)184QST  = 1,000.00 × 0.09975     =     99.75000 → rounds to  99.75 CAD (exact, no fraction)185Total = 1,000.00 + 50.00 + 99.75 = 1,149.75 CAD186```187188Cross-check with the one-step combined rate: 1,000.00 × 0.14975 = 149.75 total tax. ✓189190**Supplementary example where rounding actually triggers** (subtotal 19.99 CAD, QC):191192```193GST = 19.99 × 0.05     = 0.99950 → fraction 0.50¢ ≥ half cent → 1.00 CAD (round up)194QST = 19.99 × 0.09975  = 1.99400 → fraction 0.40¢ < half cent → 1.99 CAD (round down)195Total = 19.99 + 1.00 + 1.99 = 22.98 CAD196```197198These two cases are suitable as golden tests (exact-decimal arithmetic, Decimal type,199never float).200201## 8. Flags — items not fully confirmed from a primary official page2022031. **IN-203-V exact rounding wording**: the current-version landing page on revenuquebec.ca204   (2026-03 version) was confirmed directly, but the PDF body text quoted in §5 was read from205   a mirrored copy of the official publication (ryan.com), because revenuquebec.ca blocks206   automated PDF retrieval. The rule is independently anchored in ETA s. 165.2 (verified207   directly on laws-lois.justice.gc.ca). Risk: low. Action: a human should spot-check the208   IN-203-V PDF once before shipping the QC tax pass.2092. **CRA "When to register" page**: canada.ca returned HTTP 403 to automated fetching for210   this specific page; the $30,000 small supplier threshold was instead confirmed on Revenu211   Québec's official justepourtous.revenuquebec.ca site (which administers GST/HST in Quebec)212   and is described in IN-203-V. Risk: low.2133. **QST place-of-supply specifics** (Quebec Sales Tax Act mirroring rules, e.g. supplies214   between QC and other provinces): the general principle is confirmed; the detailed QST215   place-of-supply provisions were NOT researched in depth here. **Required follow-up research216   before implementing cross-province QST logic.**2174. **PST/RST details for BC/SK/MB** (bases, exemptions): rates confirmed via the CRA table218   only; these provinces' own tax authorities were not consulted. Out of scope for the QC-first219   Tax pass; research before adding those jurisdictions.2205. Rates change over time (e.g. Nova Scotia April 1, 2025). All rates above carry effective221   dates and must live in **versioned ALSL policies keyed by jurisdiction and effective-date222   ranges**, never in engine code.223224---225226## Source index (all consulted 2026-08-05)227228| # | Source | Publisher | URL |229|---|---|---|---|230| 1 | Tables of GST and QST Rates | Revenu Québec | https://www.revenuquebec.ca/en/businesses/consumption-taxes/gsthst-and-qst/basic-rules-for-applying-the-gsthst-and-qst/tables-of-gst-and-qst-rates/ |231| 2 | Charge and collect the tax – Which rate to charge | CRA / canada.ca | https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/gst-hst-businesses/charge-collect-which-rate.html |232| 3 | Calculating the Taxes | Revenu Québec | https://www.revenuquebec.ca/en/businesses/consumption-taxes/gsthst-and-qst/collecting-gst-and-qst/calculating-the-taxes/ |233| 4 | GST/HST rates and place-of-supply rules | CRA / canada.ca | https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/gst-hst-businesses/charge-collect-place-supply.html |234| 5 | Excise Tax Act, s. 165.2 | Justice Laws Canada | https://laws-lois.justice.gc.ca/eng/acts/E-15/section-165.2.html |235| 6 | IN-203-V, General Information Concerning the QST and the GST/HST (2026-03) | Revenu Québec | https://www.revenuquebec.ca/en/online-services/forms-and-publications/current-details/in-203-v/ |236| 7 | Budget 2012 — Eliminating the Penny | Government of Canada | https://www.budget.canada.ca/2012/themes/theme2-eng.pdf |237| 8 | Fair for all — Self-employed workers (registration threshold) | Revenu Québec | https://justepourtous.revenuquebec.ca/en/profiles/self-employed-workers/ |238| 9 | Basic Rules for Applying the GST/HST and QST | Revenu Québec | https://www.revenuquebec.ca/en/businesses/consumption-taxes/gsthst-and-qst/basic-rules-for-applying-the-gsthst-and-qst/ |239240*End of research document — AIR project — Simon-Pierre Boucher — contact@spboucher.ai*241