How Do GST/HST and QST Differ for Non-Quebec Businesses?

When a business outside Quebec sells into the province whether through e-commerce, services, digital products, or physical goods understanding the differences between GST/HST and QST becomes essential. Many non-Quebec businesses mistakenly assume GST/HST rules automatically apply to Quebec, or that they do not need to register for QST unless physically present in the province. This leads to compliance problems, tax exposure, and retroactive assessments.

This guide explains how GST/HST and QST differ for non-Quebec businesses and what obligations apply when selling to Quebec customers.

GST/HST vs. QST: The Core Difference

• GST/HST is administered federally under the Excise Tax Act.
• QST is administered provincially by Revenu Québec under the Quebec Taxation Act.

For non-Quebec businesses, this means:
• GST/HST is handled through the CRA.
• QST obligations are handled through Revenu Québec.

The two systems overlap but are legally separate.

When Non-Quebec Businesses Must Register for GST/HST

A non-Quebec business must register if:
• it carries on business in Canada, or
• it sells taxable supplies and exceeds $30,000 in worldwide taxable revenue.

Examples:
• selling goods shipped from Ontario to clients in Manitoba
• providing taxable services from Alberta to a Canadian client
• selling digital subscriptions to Canadian customers (in most cases)

When Non-Quebec Businesses Must Register for QST

Quebec’s rules are stricter.

Non-Quebec businesses must register for QST if they:
• sell taxable goods delivered into Quebec,
• supply taxable services to Quebec clients,
• sell digital products or SaaS to Quebec customers, or
• operate through online platforms with Quebec users.

There are two types of QST registration:

1. Standard QST registration (for businesses carrying on business in Quebec)

2. Specified QST registration (for non-residents supplying digital goods/services)

QST registration is required even without a physical presence in Quebec.

Example: U.S. or Ontario Sellers

You must register for QST if:
• you sell digital subscriptions to Quebec users
• you sell goods shipped to Quebec addresses
• you run an e-commerce store targeting Quebec
• your platform processes Quebec residents’ purchases

Failing to register can result in retroactive assessments.

GST/HST vs. QST Billing Differences

Non-Quebec businesses must apply different tax treatments:

If your customer is in Quebec:

• Charge GST 5%
• Charge QST 9.975% (if required to register)
• Do NOT charge HST (Quebec is not an HST province)

If your customer is outside Quebec:

• Charge GST or HST depending on the buyer’s province.
• QST does not apply.

Digital services follow customer location rules, not supplier location.

Input Tax Credits vs. Refunds for Non-Quebec Businesses

• GST/HST credits → Input Tax Credits (ITCs) through CRA
• QST credits → Input Tax Refunds (ITRs) through Revenu Québec

A non-Quebec business must file QST returns to recover QST paid.

Why Non-Quebec Businesses Get into Trouble

Common problems include:
• thinking GST/HST registration covers Quebec
• charging HST to Quebec customers (incorrect)
• not knowing QST applies to digital services
• shipping goods without tax compliance
• missing the obligation to register under specified QST rules
• not updating Shopify, Amazon, or platform tax settings

These mistakes create exposure for assessments and penalties.

Best Practices for Non-Quebec Businesses

• Determine whether your customers are in Quebec.
• Register for QST if required (standard or specified).
• Configure e-commerce platforms correctly.
• Maintain proper invoicing (showing GST and QST separately).
• File QST returns on the required frequency.
• Track ITCs and ITRs separately.
• Get CPA support when expanding into Quebec.

Mackisen Strategy

Mackisen CPA helps non-Quebec businesses:
• determine if QST registration is required
• complete the appropriate registration
• configure tax compliance on platforms
• separate GST/HST and QST accounting
• file returns and recover QST on expenses
• respond to Revenu Québec notices

We ensure compliance for all cross-border sales to Quebec.

Real Client Experience

A Toronto SaaS company unknowingly served Quebec customers without QST registration. Mackisen corrected registration and fixed two years of filings.

A U.S. e-commerce seller shipped goods into Quebec. Revenu Québec assessed QST retroactively. Mackisen negotiated reductions and fixed platform settings.

A B.C. consultant provided digital services to Quebec firms. Mackisen registered them properly and prevented penalties.

Common Questions

Do I need a physical presence to register for QST?
No, digital and remote sellers often must register.

Can I charge HST to Quebec customers?
No, Quebec requires GST + QST.

Is Shopify configuration enough?
No, manual QST setup is often required.

Why Mackisen

With more than 35 years of combined CPA experience, Mackisen CPA Montreal helps non-Quebec businesses navigate Quebec’s unique GST/QST rules, preventing penalties and ensuring full compliance when selling into the province.