Canadian invoicing has one layer of complexity most other countries don't: the difference between GST, HST, and PST — and which one applies depends on where your client is located. Get this right and your invoices are compliant and professional. Get it wrong and you're either undercharging tax you owe or confusing clients who can't reconcile your invoice. Here's what you need to know.
GST vs HST vs PST: The Basics
Canada has a federal sales tax (GST) and varying provincial sales taxes. Depending on the province, these are either separate or combined:
GST only (5%): Alberta, British Columbia, Manitoba, Quebec, Saskatchewan, and the territories. In BC, Manitoba, Quebec, and Saskatchewan, a separate provincial tax (PST or QST) also applies — charged independently.
HST (Harmonised Sales Tax): Ontario (13%), New Brunswick (15%), Newfoundland and Labrador (15%), Nova Scotia (15%), Prince Edward Island (15%). HST combines federal and provincial tax into a single rate.
As a general rule, you charge the tax rate that applies in your client's province — not yours. This is called the "place of supply" rule and is particularly relevant for services delivered remotely.
Do You Need to Register for GST/HST?
You must register for GST/HST once your annual revenue exceeds CAD $30,000 in any single calendar quarter or over four consecutive quarters. This threshold applies to most small suppliers.
Below $30,000, you're a "small supplier" and registration is voluntary. You can't charge or collect GST/HST unless you're registered — and you can't claim input tax credits on your business purchases either.
Once you hit $30,000, you must register within 29 days of the transaction that pushed you over the threshold. Don't wait until year end — the obligation starts immediately.
Your Business Number
When you register for GST/HST, the CRA issues you a Business Number (BN) — a 9-digit identifier. Your GST/HST account number is your BN followed by RT0001. This number must appear on every invoice where you're charging GST/HST.
What Every Canadian Invoice Should Include
A compliant Canadian invoice should contain:
Your business name (or personal name if operating as a sole proprietor)
Your GST/HST registration number (if registered)
The invoice date
A unique invoice number
Your client's name and address
A description of the goods or services provided
The amount charged before tax
The GST/HST rate and amount charged — shown as a separate line
Any PST/QST separately, if applicable
The total amount due
Payment terms and methods
For invoices under $30, you're not required to provide a detailed receipt — but it's still good practice.
Input Tax Credits: Reclaiming GST/HST
Once registered, you can claim Input Tax Credits (ITCs) — essentially reclaiming the GST/HST you paid on business purchases. Tools, materials, software, equipment, professional fees — if there's GST/HST on it and it's for business use, you can claim it back against what you owe the CRA.
To claim an ITC, you need a valid invoice from your supplier showing their GST/HST number and the tax charged. Keep every invoice you receive.
Quebec: QST Is Separate
Quebec operates its own provincial sales tax — the QST (Quebec Sales Tax) — administered separately from GST by Revenu Québec, not the CRA. If you're based in Quebec or regularly supply to Quebec clients, you may need to register for QST separately. The QST rate is 9.975%, in addition to the 5% federal GST — making the combined rate 14.975%.
Filing GST/HST Returns
How often you file depends on your annual revenue:
Under $1.5 million: annual filing (with optional quarterly instalments)
$1.5 million to $6 million: quarterly filing
Over $6 million: monthly filing
Most freelancers and sole traders will file annually or quarterly. Returns are filed online through the CRA's My Business Account portal.
Record Keeping
The CRA requires you to keep business records — including all invoices — for a minimum of 6 years from the end of the tax year they relate to. Digital records are acceptable. Keep everything organised by year so you're not scrambling at audit time.
Clervo handles the invoice structure for Canadian users — business number field, GST/HST line items, and a clean digital record of every transaction you've billed.