Freelance editors: Here’s what you need to know
Do I need to register for a PST number?No. There’s no need to apply for a PST registration number because professional services other than legal services are exempt from PST.
What tax do I charge?From April 1, 2013, editors charge GST only. Use your existing GST/HST number.
Place of supply
The place of supply rules stay the same as before: an editor who lives in BC charges a client the HST or GST rate of the province where the client is located (see the rules about place of supply). So I charge BC clients 5% GST, but when I work for a client in Ontario, I charge 13% HST. As before, when I work for a client outside the country, I charge no tax at all.
Edit (February 25, 2015): Looking again at the place of supply rules, it seems as if under rule 2, you would charge the GST/HST rate of your own province if you don’t get a business address for your client. I think I’ll need to phone the CRA again to confirm this.
GST/HST rates by province (information taken from CRA)This is how much GST/HST you charge a client in this province.
|Province||Before April 1, 2013||After April 1, 2013|
|British Columbia||12% (HST)||5% (GST)|
|New Brunswick (HST)||13%||13%|
|Newfoundland and Labrador (HST)||13%||13%|
|Northwest Territories (GST)||5%||5%|
|Nova Scotia (HST)||15%||15%|
|Prince Edward Island||5% (GST)||14% (HST)|
Quick method remittance rateIf you use the quick method of GST/HST accounting (I strongly recommend it for editors), your remittance rate is now 3.6% for BC clients. This is the remittance rate for a service provider based in a non-participating province (which BC is now) to a client in a non-participating province. (A “participating” province has HST; a “non-participating” province has GST.) Your remittance rates for income earned from clients in other provinces stays the same (except PEI, which instituted HST this April 1). Don’t forget that this new 3.6% remittance rate for BC clients only applies to your income from April 1 onward.
Quick method remittance rates for work done in BC (information taken from CRA)This is how much GST/HST an editor in BC remits.
|Client is in this province||Rate before April 1, 2013||Rate after April 1, 2013|
|BC (participation changed)||8.2% (part.)||3.6% (non-part.)|
|Nova Scotia (participating)||10.6%||12%|
|Prince Edward Island (participation changed)||2.1% (non-part.)||11.3% (part.)|
|Other participating province||9%||10.5%|
|Other non-participating province||2.1%||3.6%|
Sources for my informationChanges to the Harmonized Sales Tax
BC Government: PST exemptions (see the sidebar “Non-Taxable Sales & Services”)
CRA: List of GST/HST rates by province
CRA: Place of supply rules for services
CRA: Remittance rates for businesses that provide services
As always, this is backed up by a few calls to the CRA help line.