What is a sales tax?
In Canada, a Provincial Sales Tax (P.S.T.) is levied by the provinces. There are also two taxes levied by the federal government: Harmonized Sales Tax (H.S.T.) and Goods and Services Tax (G.S.T.) The G.S.T. rate is 5%. In the U.S., there’s no national sales tax. Forty-five states and the District of Columbia levy general sales taxes that apply to the sale or lease of most goods and some services. Within the U.S. the definitions of retail sales and taxable items vary among the states.
- Within the U.S. many states require individuals and businesses who regularly make sales to register with the state.
- Within Canada, you need to register your business for a GST/HST account. Once you begin collecting GST/HST, you need to inform your customers via receipts or invoices.
- A Wave account comes with free, unlimited invoicing that you can customize for each client.
- Did you know that you can run both an at-a-glance as well as an in-depth Sales Tax Report as part of our free Wave accounting software?