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The Charter of the French language and its regulations govern the consultation of English-language content.

Principals and Agents (Mandators and Mandataries)

A mandate is a contract by which a person (an “agent” for GST purposes and a “mandatary” for QST purposes) is empowered to represent another person (the “principal” for GST purposes and the “mandator” for QST purposes) in the performance of a judicial act in respect of a third party. As part of its mandate, an agent may thus sell tangible personal property on behalf of a principal.

If the principal would be required to collect the taxes on a sale, the usual GST and QST rules apply to sales by an agent. Principals must therefore collect and report the taxes on the taxable sales (excluding zero-rated sales) made by their agents. For their part, agents must collect and report the taxes on the services they provide to principals with regard to taxable sales.


ABC Ltd. is a registrant. The company has several surplus computers that were used in its commercial activities. It arranges to have the computers sold by an agent who is also a registrant.

The agent asks for a commission amounting to 10% of the sale price (excluding GST and QST), and sells all of the computers to one buyer for $1,000.

The agent therefore bills the customer $50 GST ($1,000 × 5%) and $99.75 QST ($1,000 × 9.975%).

The agent then credits $1,149.75 ($1,000 + $50 + $99.75) to ABC Ltd. and requests payment of the $100 commission ($1,000 × 10%), $5 GST and $9.98 QST (for a total of $114.98).

ABC Ltd. therefore receives $1,034.77 from the agent ($1,149.75 − $114.98), and remits $45 net GST ($50 GST − $5 ITC) and $89.77 net QST ($99.75 QST − $9.98 ITR) to us. The agent reports only the taxes charged on the commission.

Joint election

However, an agent and a principal can jointly elect to have the agent collect, report and remit the taxes. In this case, the agent must be a registrant for the taxes to which the election applies. The election must be made using form FP-2506-V, Election or Revocation of an Election by a Principal and the Principal's Agent: Responsibility for Collecting, Reporting and Remitting the GST/HST and the QST. Under the election, the agent and principal become jointly and severally responsible for any resulting obligations. The agent must collect GST and QST on the commission received from the principal.

If the principal is not required to collect the GST or QST on the sale of taxable tangible personal property, the agent is generally considered to have sold the property to the buyer. The agent must therefore be registered for the GST and QST, and must collect the taxes and remit them to us. However, the agent is not required to collect the taxes on the services provided to the principal with regard to the sale.


A customer who is not a registrant asks a merchant (the agent) to sell a boat for her. The boat was used for personal purposes. The agent, who is a registrant, asks for a commission of 10% of the sale price (excluding GST and QST).

The agent sells the boat for $21,000. The agent must charge $1,050 GST and $2,094.75 QST to the buyer and remit those amounts to us. However, the $2,100 commission ($21,000 × 10%) that the customer pays to the agent is not taxable.

In such cases, the principal and the agent may make a joint election in writing to have the principal collect the taxes from the buyer and report them. This election can be made if the principal is a registrant who is not required to collect the taxes on the sale in question and if the property was last acquired by the principal for consumption or use in a business, adventure or concern in the nature of trade. In this case, the agent must collect and report the GST and QST applicable to the services provided to the principal.


Auctioneers are considered agents, and are subject to special rules. For more information, refer to GST/HST Info Sheet GI‑010, Auctioneers, published by the Canada Revenue Agency and available on the Government of Canada website.

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