Provincial Sales Tax Traps

Businesses may be liable for Provincial sales taxes... and not even know it. Click HERE for a discussion on Provincial income tax traps.

Alberta has no provincial sales tax, so businesses mostly situated in Alberta don't even think about sales tax. But, any business that has activities connected (even remotely) with provinces other than Alberta must be wary that they may be generating a sales tax liability in that province. One situation to watch out for are sales where the recipient of the good or service is located in a Province other than Alberta. Even if a sale is made to a vendor resident in Alberta, if the product or service is transported to another Province by the seller business, that business could be subject to Provincial Sales Tax. Each Province has its own set of rules and exemptions and therefore each case must be examined on its own merit. Additionally, not every Province calls it a "Sales Tax". For example, in British Columbia the sales tax is called a "Social Security Tax" and in Saskatchewan it is called a Provincial "Consumption Tax".

Taxpayers need to be aware of these issues and ensure they perform due diligence. Consider consulting with a professional accountant. Contact Keith Anderson CA at (780) 447-5830 if you need advice. 

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