PST and QST: Provincial Tax Guide for Canadian Freelancers

Why PST and QST Exists

When the federal government introduced the Goods and Services Tax in 1991, it invited provinces to harmonize their retail sales taxes with the GST into a single "Harmonized Sales Tax." Most Atlantic provinces and Ontario eventually agreed. But British Columbia, Manitoba, Saskatchewan, and Quebec declined to harmonize — they kept their own provincial consumption taxes running parallel to the federal GST.

The practical result is that businesses operating in or selling to clients in these provinces must manage two separate tax systems simultaneously: the federal GST account with the CRA, and a provincial tax account with the provincial government. They have different registration thresholds, different taxable bases, and different filing deadlines. For freelancers who work across provincial lines, this creates a layer of complexity that catches many new self-employed workers off guard.

British Columbia PST (7%)

British Columbia levies a Provincial Sales Tax of 7% under the Provincial Sales Tax Act. BC's PST applies to the sale of goods and certain services — it is not a blanket tax on all economic activity. The key distinction in BC is that most professional services are exempt from PST.

What BC PST Applies To

BC PST generally applies to:

• Tangible goods sold in BC
• Software — both off-the-shelf software and, since April 2021, software as a service (SaaS) and digital software licenses
• Telecommunication services
• Legal services (limited circumstances)
• Accommodation

What BC PST Does NOT Apply To (Most Freelancers)

The following services are generally exempt from BC PST:

• Consulting, advisory, and professional services (legal advice is separate)
• Graphic design (the design service itself — physical printed goods may attract PST)
• Writing, editing, and copywriting services
• Photography services (the service itself; physical prints may attract PST)
• Marketing and advertising services
• Web development services (building a website — distinct from selling software)

BC PST Registration Threshold

If your BC taxable sales exceed $10,000 in any 12-month period to BC residents, you are required to register for BC PST. For most freelancers providing professional services, this threshold is academic because the services are exempt. However, if you develop and license software products to BC clients, the $10,000 threshold is very real and is reached quickly.

Out-of-province suppliers (e.g., an Ontario consultant with a BC client) must register for BC PST if they are selling taxable goods or services to BC residents and meet the threshold — including the sale of SaaS products that BC residents access.

Manitoba RST (7%)

Manitoba's Retail Sales Tax (RST) — colloquially still called PST — sits at 7% and is administered by the Manitoba Finance department. Like BC, Manitoba's RST applies primarily to goods rather than services, which means most freelancers providing professional services are not caught by it.

Professional Services in Manitoba

Manitoba RST generally does not apply to professional services such as:

• Consulting and business advisory services
• Accounting and bookkeeping (unless combined with taxable goods)
• Legal services
• Marketing and copywriting
• Software development services (custom development is a service, not a good)

However, Manitoba RST does apply to:

• Sale of tangible personal property (physical goods)
• Repair or maintenance services on taxable goods
• Certain telecommunication services
• Off-the-shelf or pre-written software sold as a product
• Online marketplace services in some categories

Manitoba does not have an explicit annual revenue threshold equivalent to the GST small supplier rule. Registration is required as soon as you start making taxable sales in Manitoba. Since most freelance professional services are exempt, this is rarely an issue. If you sell physical products or taxable software licenses into Manitoba, register with Manitoba Finance before your first taxable sale.

Saskatchewan PST (6%)

Saskatchewan's Provincial Sales Tax of 6% has one of the broadest bases of all provincial sales taxes in Canada. Unlike BC and Manitoba, Saskatchewan explicitly taxes many services that other provinces exempt. This makes it the most likely provincial tax to catch freelancers off guard.

Services Taxable Under Saskatchewan PST

Saskatchewan PST applies to a wide range of services, including:

• Contract services — work performed to repair, install, or maintain tangible goods
• Services to real property — construction, renovation, cleaning, landscaping
• Computer services — IT support, data processing, cloud computing, software development (including custom software)
• Telecommunications services
• Storage services
• Insurance (certain types)

What Is Exempt in Saskatchewan

Professional services such as accounting, legal advice, consulting, writing, and photography services generally remain exempt from Saskatchewan PST, though the lines are not always clear. If your work involves any computer-related services delivered to Saskatchewan clients, verify whether your specific service is taxable. The Saskatchewan Finance department provides a series of information bulletins on specific service categories.

There is no explicit revenue threshold for Saskatchewan PST registration — registration is required when you make taxable sales into Saskatchewan, regardless of amount.

Quebec QST (9.975%)

Quebec's Taxe de vente du Québec (TVQ), known in English as the Quebec Sales Tax (QST), is levied at 9.975% and is administered by Revenu Québec — a separate provincial tax authority, not the CRA. The QST is structured very similarly to the federal GST, with the same broad base, similar exemptions, and an equivalent input tax refund (ITR) system mirroring the federal ITC mechanism.

QST Registration Threshold

The QST registration threshold mirrors the federal GST threshold: $30,000 in annual taxable supplies made in Quebec. If you are a Quebec-based freelancer, once your revenues cross $30,000 in four rolling quarters, you must register for both GST with the CRA and QST with Revenu Québec — these are two separate registrations, two separate accounts, and two separate returns.

Out-of-Province Suppliers and Quebec QST

If you are not based in Quebec but provide services to Quebec clients, the QST obligations depend on your total sales to Quebec residents:

• Specified suppliers (non-resident businesses without a physical establishment in Quebec): must register for QST if their taxable Quebec revenues exceed $30,000 in four consecutive calendar quarters. Since 2019, this applies to digital service providers selling to Quebec consumers.
• If you are another Canadian province-based freelancer with occasional Quebec clients, you likely do not need to register for QST until your Quebec-specific revenues approach $30,000. Track Quebec revenue separately.

QST Number Format

Your QST registration number is issued by Revenu Québec and has the format 1234567890 TQ0001 — a 10-digit number followed by "TQ" and an account sequence. This is distinct from your CRA Business Number (9 digits, RT0001). Both numbers must appear on invoices issued to Quebec clients when both taxes apply.

Input Tax Refunds (ITRs) Under QST

Registered QST businesses can claim back the QST they pay on business purchases through Input Tax Refunds (ITRs) — the QST equivalent of the federal ITC. The eligibility rules and documentation requirements are almost identical to the federal ITC system. If you are registered for both GST and QST, you recover both taxes on eligible business expenses.

Registering in Multiple Provinces

A freelancer based in Ontario working with clients across Canada could theoretically face obligations in multiple provincial tax systems. Here is how to think about when multi-province registration applies:

The practical takeaway: for most professional services freelancers (writers, designers, consultants, photographers), BC and Manitoba PST are unlikely to apply. Saskatchewan PST may apply if you provide computer-related services. Quebec QST will apply once your Quebec billings reach $30,000.

How to Show PST/QST on an Invoice

When you are registered for both GST and a provincial tax, both must appear as separate line items on your invoice. Do not combine them into a single "taxes" line. Here is a correctly formatted invoice excerpt for a Quebec client (GST + QST):

For a Saskatchewan client where your services are taxable under PST:

What Happens If You Miss a PST Registration

Each province has its own penalties for failing to register when required. In general:

• British Columbia: The BC PST Bulletin PST 001 states that unregistered suppliers who should have been collecting PST are liable for the uncollected tax, interest, and penalties. The province can audit back up to seven years.
• Saskatchewan: Failure to register results in liability for all PST that should have been collected, plus interest at the prescribed rate, and a penalty of up to 10% of the tax owing.
• Quebec: Revenu Québec can assess unregistered suppliers for QST owing going back four years (or further if fraud is involved), plus interest and penalties. Revenu Québec has been actively pursuing out-of-province digital service providers since 2019.

Voluntary disclosure programs exist in BC, Saskatchewan, and Quebec. If you realize you should have been registered but weren't, proactively contacting the provincial tax authority before an audit notice arrives typically results in reduced or waived penalties — you pay the tax and interest, but avoid the penalty. Once an audit is underway, the voluntary disclosure option closes.