Charging GST/HST when set up as a Sole Proprietor (Independent Contractor) in Canada

[SatwinderSingh]

Hi All,

I am working as an Independent contractor for a US-Based client through and getting paid through Deel. Since, I am no longer a small supplier (my income is more than 30,000 CAD in four consecutive quarters), I am required to have a BN and GST/HST number with CRA. My question is that do I need to charge GST/HST to my US client? If yes, then at what rate, how?

[Jess]

Hi @SatwinderSingh, 

Happy new year! I'm looking into this for you and will get back to you with an answer shortly. 

Cheers,
Jess

[daryldy]

Hi @SatwinderSingh 

To add to @Jess , it appears that you are exempt for this to your US client as it falls under place of supply rules in Canada. As long as the client is outside of Canada, they are zero rated regardless of your net revenue. You can find more details here.

It is still best to talk with a local tax consultant to have the best information at hand. 🙂 

Best,
Daryl

[pauloc]

I am in the exact same position as the poster. I am also an independent contractor (Sole proprietor) who lives in Canada and works from Canada, but provides services to a US-based company, and is making over 30k CAD.

The optional compliance documents are making it sound like it's required for me to register and provide proof of that HST registration, but it seems from this thread it's not necessary as the client is outside of Canada.

Am I correct here in that providing proof of HST registration is therefore unnecessary?

[Kyra]

Hi @pauloc, welcome to the Community!

The proof of HST registration is a document required to make sure you and the company you are working for are in full compliance with the rules and regulations in your country. We suggest keeping these documents up-to-date to avoid compliance risks.

In the meantime, you can still receive payments without having all the documents on the platform. That means you won't be blocked from receiving your payments or withdrawing your funds if you don't upload those documents.

If you have any doubts about what to provide for a specific compliance document section, we always recommend that you check in with a local tax specialist or legal advisor who will be able to provide you with the best guidance. Deel also offers on demand support from a personal tax advisor specialised in working with freelancers — which is currently available to our workers based in Canada. You can take a look at this article for more details on how it works.

Hope this helps and please reach out if you have any additional questions.

Thank you,
Kyra