Do I Need to Self-Assess QST on Out-of-Province Purchases?

Quebec businesses often buy goods and services from suppliers located outside the province from Ontario manufacturers, Alberta consultants, U.S. software providers, or international online platforms. Many businesses assume that if QST isn’t charged on the invoice, no tax is owed. Unfortunately, that is not the case. Quebec’s tax rules often require you to self-assess QST when a supplier does not charge it.

This guide explains when self-assessment is required, how to calculate it, and how to stay compliant and avoid penalties.

What Is QST Self-Assessment?

Self-assessment means:
• you calculate the QST yourself
• you remit it to Revenu Québec
• even though the supplier did not charge the tax

It applies when a business buys taxable goods or services for use in Quebec, but the supplier does not collect QST.

Self-assessment ensures that Quebec receives the provincial tax portion even when suppliers are outside the jurisdiction.

When You MUST Self-Assess QST

You must self-assess QST when:

1. You buy taxable goods from outside Quebec or outside Canada

Examples:
• equipment from Ontario
• supplies from B.C.
• tools shipped from the U.S.
• furniture purchased online

If the goods are used in Quebec, self-assessment applies.

2. You buy taxable services from suppliers outside Quebec

Examples:
• Alberta consultant
• Ontario marketing firm
• international contractor
• online service provider

If the service benefits your Quebec business, QST is required.

3. You buy software, SaaS, or digital products from outside Quebec

Examples:
• Adobe
• Microsoft
• Shopify
• Google Workspace
• CRM or HR software
• cloud storage
• digital design subscriptions

If the supplier is not registered for QST, you must self-assess.

4. You import goods into Quebec

QST may be collected by CBSA upon entry otherwise, self-assessment applies.

5. You buy from U.S. or international sellers who do not charge QST

If the product or service is taxable in Quebec, you owe QST.

When You Do NOT Need to Self-Assess

If the supplier charges QST properly

• A registered supplier within Quebec
• A non-resident registered under the specified QST system

If the supply is exempt

Healthcare, certain education services, financial services, etc.

If the purchase is for resale

Normal ITC/ITR rules apply, but the tax treatment depends on use.

How to Calculate QST Self-Assessment

QST rate: 9.975%

Formula:
QST to self-assess = taxable amount × 9.975%

Example:
Ontario supplier charges $10,000 (no QST)
QST owing = $10,000 × 9.975% = $997.50

How to Report QST Self-Assessment

Self-assessed QST is entered on your FPZ-500-V combined return:

• Add QST in the “tax payable” section
• Then claim the same amount as an ITR (if eligible)

Most businesses have no net cost, because:
• they self-assess QST
• then claim an equal refund (ITR)
• unless the purchase is non-creditable (restricted or exempt)

When Self-Assessment Creates a Real Cost

You cannot claim ITRs if:
• the purchase relates to exempt activities
• the expense is personal or mixed use
• the purchase falls under large-business restrictions
• documentation is incomplete

In these cases, self-assessment becomes an actual expense.

Why This Rule Exists

Without self-assessment:
• Quebec would lose tax revenue
• businesses would buy tax-free outside the province
• local suppliers would be at a tax disadvantage

Self-assessment levels the playing field.

Common Mistakes Businesses Make

• not knowing that digital subscriptions require QST
• assuming Ontario purchases are tax-free
• forgetting to self-assess on cross-border consulting services
• misreporting imports of software or equipment
• failing to keep supplier invoices
• not documenting the use of the purchase
• claiming ITRs without properly self-assessing first

These mistakes often lead to audit adjustments.

Mackisen Strategy

Mackisen CPA helps businesses:
• identify when self-assessment is required
• calculate correct QST on out-of-province purchases
• configure accounting software to track self-assessed tax
• report QST properly on FPZ-500-V
• claim eligible ITRs
• avoid penalties and audit exposure

Real Client Experience

A tech firm bought $120,000 of U.S. software without self-assessing. Mackisen corrected two years of returns and avoided penalties.

An e-commerce seller purchased inventory from Ontario without charging QST. Revenu Québec reassessed $8,000 until documentation corrected it.

A consultant paid Alberta subcontractors. Mackisen helped self-assess properly and claim full ITRs.

Common Questions

Do I need to self-assess for every out-of-province purchase?
Only for taxable supplies used in Quebec when QST was not charged.

Is it illegal to skip self-assessment?
Revenu Québec treats it as underreported tax penalties apply.

Do U.S. subscriptions require QST?
Yes, unless the supplier is QST-registered.

Can I claim an ITR for self-assessed QST?
Yes if the purchase relates to taxable business activity.

Why Mackisen

With more than 35 years of combined CPA experience, Mackisen CPA Montreal ensures businesses stay compliant with QST self-assessment rules, preventing costly reassessments and preserving your tax credits.