Imports of Property
Property imported into Canada is generally subject to 5% GST, and property brought into Québec is generally subject to 9.975% QST. This excludes items designated as non-taxable importations (GST system) or as non-taxable property brought into Québec (QST system).
Non-taxable items include:
- certain medals, and certain trophies and other prizes;
- goods donated to a charity that are subsequently imported by the charity; and
- replacement parts or replacement property under warranty that is provided free of charge and sent to a person in Québec or elsewhere in Canada.
Collecting, reporting and remitting the taxes
As a rule, GST is collected on taxable goods (excluding zero-rated goods) imported into Canada, when the goods go through customs. The amount of GST is calculated on the value of the goods, including any applicable customs duties. If you are a GST registrant, you can claim an input tax credit (ITC) for the GST paid on goods imported in the course of your commercial activities.
If you are registered for the QST, you do not have to collect QST on property if you meet the following two conditions:
- You are bringing the property into Québec from outside Canada exclusively for use in your commercial activities.
- You can claim an input tax refund (ITR) for the QST payable on the property.
If you do not meet the conditions, you must report the QST payable in your return.
In addition, QST is collected on taxable property (excluding zero-rated property) that is brought into Québec by consumers from outside Canada, when the property goes through customs.
In the case of property brought into Québec from another place in Canada, the person that brings the property into Québec must remit the corresponding QST to us immediately after the property arrives in Québec, unless the person is a registrant and the property is for consumption or use exclusively in commercial activities. In other words, the person is not required to pay QST on property brought into Québec where an ITR could be claimed if the person paid the tax. Otherwise, the person must report the QST payable in the person's return.
A person that is not a QST registrant and that must pay the QST after bringing a property into Québec must report the property using form FP-505-V, Special-Purpose Returns, and form FP-505.D.D-V, QST Return Respecting Property or a Service Brought into Québec by a Person That Is Not a QST Registrant.