Reporting Sales Tax and Goods/Services Tax in Canada

In Canada, when a vendor does not have a business presence in the province in which purchases are made, the vendor will charge the Goods and Services Tax (GST) or Harmonized Sales Tax (HST) only. However, if the province has a Provincial Sales Tax (PST), then the purchaser must still calculate the PST and pay it directly to the province. When a Provincial Tax Area Code is selected, Dynamics NAV uses it to calculate the PST and post it so that there is a tax liability in both the general ledger and the tax entry records. Therefore, the tax area code selected here should be one where only the PST is included, not the GST.

Submitting the GST/HST File

The tax information in purchase documents is used to generate a GST/HST online file transfer that you must provide to the tax authorities. This file includes goods and services tax (GST) and harmonized sales tax (HST). The file is created in a .tax file format, which can be transferred online.

See Also

Dynamics 365 Business Central
Canada Local Functionality
Finance
Setting Up Finance
Reporting Sales Tax in Canada
Working with Dynamics NAV