Goods and Services Tax (GST) and Harmonized Sales Tax (HST) are consumption taxes applied in Canada. Knowing how to calculate them correctly ensures accurate pricing, receipts, and tax remittances.
Canadian GST/HST Rates (2025)
| Province | Tax type | Rate |
|---|---|---|
| Alberta | GST only | 5% |
| British Columbia | GST + PST | 5% + 7% = 12% |
| Ontario | HST | 13% |
| Nova Scotia | HST | 15% |
| New Brunswick | HST | 15% |
| PEI | HST | 15% |
| Quebec | GST + QST | 5% + 9.975% = 14.975% |
| Manitoba | GST + RST | 5% + 7% = 12% |
Calculating Tax on a Price (Adding GST/HST)
Tax amount = Pre-tax price × Tax rate
Total = Pre-tax price × (1 + Tax rate)
Example: Ontario, $120 pre-tax price, 13% HST:
HST = $120 × 0.13 = $15.60
Total = $120 + $15.60 = $135.60
Or: $120 × 1.13 = $135.60`
Extracting GST/HST from a Tax-Inclusive Price
When the price already includes tax and you need to find the original:
Pre-tax price = Total ÷ (1 + Tax rate)
Tax amount = Total − Pre-tax price
Example: You paid $135.60 all-in in Ontario (13% HST):
Pre-tax = $135.60 ÷ 1.13 = $120.00
HST = $135.60 − $120.00 = $15.60
Split GST and PST (e.g. British Columbia)
When GST and PST are separate:
| Tax | Rate | On $100 |
|---|---|---|
| GST | 5% | $5.00 |
| PST | 7% | $7.00 |
| Total | 12% | $112.00 |
Note: PST is usually charged on the pre-GST price, not on top of GST.
Input Tax Credits (ITCs)
If you are a GST/HST-registered business:
- You collect GST/HST from customers
- You claim back GST/HST paid on business purchases (ITCs)
- You remit the difference to the CRA
GST/HST owing = GST collected − ITCs claimed
Registration Threshold
You must register for GST/HST if your total sales exceed $30,000 CAD in a single calendar quarter or over four consecutive quarters. Below this threshold, registration is optional (but you cannot claim ITCs).
Quick Reference: GST Only
For provinces with 5% GST only:
| Pre-tax | GST (5%) | Total |
|---|---|---|
| $50 | $2.50 | $52.50 |
| $100 | $5.00 | $105.00 |
| $500 | $25.00 | $525.00 |
| $1,000 | $50.00 | $1,050.00 |