Do I Charge GST/QST on Used Goods I Resell?

Reselling used goods whether you’re flipping furniture, selling refurbished electronics, running a thrift store, or operating a small resale business comes with specific GST/QST rules that many Quebec entrepreneurs misunderstand. Some believe used items are tax-exempt. Others think tax only applies to “new” products. Most used goods are taxable, and failing to charge GST/QST can lead to reassessments and denied input credits.

This guide explains when GST/QST applies to used goods, what exemptions exist, how resale businesses should charge tax, and how to stay fully compliant.

Are Used Goods Taxable?

In most cases, YES used goods are taxable.

GST (5%) and QST (9.975%) apply to taxable tangible personal property, whether sold new or used.

Examples of taxable used goods:
• electronics
• appliances
• tools and equipment
• clothing (except zero-rated children’s clothing in some cases)
• furniture
• décor and household items
• sports equipment
• vehicles (special rules apply)

If the item is taxable when new, it is typically taxable when used.

When Used Goods Are NOT Taxable

Used goods are exempt from GST/QST when:
• the item is exempt by law (e.g., certain medical devices, certain used farm equipment)
• the seller is a non-registrant (i.e., private individual selling personal property)
• the supply qualifies as zero-rated (rare for used goods)
• the sale is part of a casual private transaction

If a private person sells a used item on Facebook Marketplace, no GST/QST applies because the seller is not registered.

But a business selling used goods must charge tax.

If You Buy Used Goods and Resell Them

Scenario 1: You buy from a registered supplier

If the supplier charges GST/QST:
• you pay tax
• you claim ITCs/ITRs
• you resell and charge tax again

Normal rules apply.

Scenario 2: You buy from a private individual (non-registered)

If the seller is not registered:
• GST/QST is not charged
• BUT you still need to charge GST/QST when you resell
• You cannot claim ITCs/ITRs on the purchase
• Your entire resale price becomes taxable

This is where many resellers make mistakes.

Scenario 3: You buy used goods from another province or from the U.S.

If tax wasn’t charged:
• QST must be charged when resold
• GST may need to be self-assessed
• QST may need to be self-assessed too
• ITCs/ITRs depend on whether tax was originally paid

Cross-border resale requires careful tax coding.

Special Case: Used Vehicles

Used vehicles follow unique rules:
• sales between private individuals are tax-exempt
• commercial vehicle resales by dealers are taxable
• buyers must self-assess QST on private used vehicle purchases (different system)
• businesses must charge QST when reselling vehicles

Vehicle rules are complex consult a CPA for dealership activity.

How GST/QST Applies When You’re a Reseller

If you operate a resale business, you must:
• charge GST/QST on all taxable used goods
• keep receipts for all purchases (even from private sellers)
• identify whether you paid any GST/QST originally
• claim ITCs/ITRs where eligible
• self-assess tax on qualifying acquisitions

Common Mistakes Resale Businesses Make

• believing used goods are tax-free
• failing to charge tax when buying from private sellers
• not keeping purchase documentation
• claiming ITCs when tax was never paid
• misclassifying inventory as exempt
• not self-assessing GST/QST on imports
• combining tax lines instead of separating GST and QST
• using incorrect Shopify or POS tax settings

These mistakes often trigger GST/QST audits for resellers.

How to Invoice for Used Goods

Your invoice must clearly show:
• selling price
• GST amount
• QST amount
• GST/QST registration numbers
• description of the item

If the price is tax-included, disclosure is still required.

Mackisen Strategy

Mackisen CPA helps resale businesses:
• determine GST/QST obligations
• configure POS systems properly
• self-assess tax on used acquisitions
• claim eligible credits
• prepare clean documentation for audits
• correct past filings and amend returns

We make resale taxation predictable and compliant.

Real Client Experience

A furniture reseller thought used items were exempt. Mackisen found $22,000 in uncharged QST. Adjusted invoicing prevented penalties.

Tech refurbished imported used electronics from the U.S. without self-assessment. Mackisen corrected returns and avoided interest.

A thrift store lost ITRs due to missing purchase receipts. Mackisen implemented proper documentation systems.

Common Questions

Do private sellers charge GST/QST?
No, only registered businesses do.

Can I claim ITCs when buying used goods from a private seller?
No no tax was paid.

Do I charge QST when reselling?
Yes if your business is registered.

Are used goods ever exempt?
Only if the product is exempt by law.

Why Mackisen

With more than 35 years of combined CPA experience, Mackisen CPA Montreal ensures used-goods businesses handle GST/QST correctly, prevent penalties, and stay fully compliant whether selling locally or online.