Non resident GST registration: $30,000 test or simplified regime

Which non resident businesses have to register?

Section 240 of the Excise Tax Act requires registration from anyone making taxable supplies in Canada in the course of a commercial activity, with three exceptions: small suppliers, sellers of real property outside a business, and non residents who carry on no business in Canada laws-lois.justice.gc.ca. That third exception is why the first question for any foreign client is whether it carries on business here. The digital economy rules then add separate triggers for businesses that don't canada.ca.

The admissions and convention rows come straight from the CRA's registration page, which says the client has to register "even if you are a small supplier" canada.ca. For conventions, the trigger is a reasonable expectation that more than 25% of admissions will go to Canadian delegates canada.ca. The admissions rule in subsection 240(2) is the strictest timing in the Act: the application goes in before the first ticket is sold laws-lois.justice.gc.ca. Goods sold through a Canadian warehouse fall under section 211.22, which has its own $30,000 test over any 12 months laws-lois.justice.gc.ca, and subsection 240(2.1) gives that seller until the day that is 30 days after the first day it is required to be registered to apply laws-lois.justice.gc.ca. The $30,000 small supplier test itself, with its calendar quarter mechanics and associate rule, is on our GST registration threshold page.

No office in Canada does not mean no business in Canada

The CRA says a client may be carrying on business in Canada "even if you do not have a permanent establishment in Canada" canada.ca. It's a question of fact. Guide RC4027 lists the factors the CRA weighs: where agents or employees are located, where delivery and payment happen, where contracts are made, and where a bank account or branch sits canada.ca.

A permanent establishment is narrower. RC4027 defines it as a fixed place of business, such as a place of management, a branch, an office, a factory or a workshop, or the fixed place of business of an agent acting for the non resident in Canada, but not a broker or independent agent acting in the ordinary course canada.ca. The two tests answer different questions: carrying on business decides whether your client must register, and a permanent establishment decides whether it posts security.

Section 143 explains why this matters so much. A supply of personal property or a service made in Canada by a non resident is deemed made outside Canada unless it's made in the course of a business carried on in Canada, the non resident is registered under the normal regime, it's a qualifying goods supply under section 211.22, or it's an admission laws-lois.justice.gc.ca. Outside those cases there is no GST/HST to charge. When your client is unregistered and outside the simplified regime, a Canadian customer importing its services may have to self assess instead, unless the customer uses them 90% or more in commercial activities canada.ca. Our GST59 imported services page covers that side.

How does the simplified regime work for digital sellers and platforms?

Since July 1, 2021, a non resident with no business in Canada that is not registered under the normal regime must register under the simplified regime when its threshold amount for any 12 month period beginning on or after July 2021 exceeds $30,000. It applies electronically, on or before the first day it is required to be registered laws-lois.justice.gc.ca. The repeal of the digital services tax did not touch this rule.

Only specified supplies to specified Canadian recipients count. A specified supply is a taxable supply of intangible personal property or a service, other than items that can only be used outside Canada or relate to real property or goods abroad. A specified Canadian recipient is a customer whose usual place of residence is in Canada and who has not given the supplier, or the platform, evidence that it is registered under the normal regime laws-lois.justice.gc.ca. Zero rated supplies are left out. So are a vendor's sales facilitated by a distribution platform operator registered under either regime, because they count toward the platform's threshold instead canada.ca.

Worked example. A US app developer with no presence in Canada sells subscriptions to Canadian users directly, not through an app store. Over the 12 months to June 30, 2026 it bills:

In July 2026 consumer sales for the 12 months to July 31 reach $31,000. That period's threshold amount exceeds $30,000, so the developer is required to be registered under the simplified regime and should apply no later than that day. The CRA counts revenue that is "or could reasonably expected to be" earned in the period, so a developer launching a big Canadian campaign should recalculate before the money arrives, not after canada.ca.

Three rules make the simplified regime different from a normal registration. Your client can't claim input tax credits on its own costs canada.ca. It files every calendar quarter, with the return due one month after the quarter ends (April 30, July 31, October 31, January 31), and may apply to report and pay in US dollars or euros canada.ca. Payment is electronic only canada.ca. Distribution platform operators and accommodation platform operators can use the simplified regime too, but a client selling qualifying goods can only register under the normal regime, and no one can be registered under both at once canada.ca.

How much security does a non resident post?

Subsection 240(6) requires a non resident with no permanent establishment in Canada that applies or is required to register to give and maintain security for the tax it will owe laws-lois.justice.gc.ca. The CRA sets the amount at 50% of estimated net tax for the first 12 months after registration, then 50% of actual net tax for the last 12 months, with a minimum of $5,000 and a maximum of $1 million. No security is needed when estimated taxable supplies in Canada are $100,000 or less a year and annual net tax falls between $3,000 remittable and $3,000 refundable canada.ca.

Three US clients with no permanent establishment sell to Ontario customers at the 13% HST rate. Net tax is the HST collected less input tax credits on Canadian costs:

Client A needs both waiver conditions. Had its ITCs been $7,000, net tax would be $3,400 and the $5,000 minimum would apply even though sales stayed under $100,000. Ontario's 13% comes from the place of supply, not from where your client is based canada.ca; see place of supply and HST rates by province for other provinces. The CRA accepts cash, a certified cheque, a money order or a qualifying bond, but not non transferable bonds such as Canada Savings Bonds canada.ca.

When does voluntary registration make sense for a non resident?

A non resident with no business in Canada can register voluntarily if, in the ordinary course of its business outside Canada, it regularly solicits orders for goods to be exported or delivered to Canada, agrees to supply services to be performed in Canada, or supplies intangible property to be used in Canada or related to Canadian real property, goods or services canada.ca. The effective date is usually the date of the request and can go back up to 30 days, and your client has to stay registered for at least one year unless it stops its commercial activities.

The usual reason is input tax credits: a client that pays GST/HST on Canadian inputs, or sells to Canadian businesses that want a properly registered supplier, can recover tax only under a normal registration. The cost is that section 143 stops treating its Canadian supplies as made outside Canada once it registers, so every taxable supply it makes in Canada now carries GST/HST laws-lois.justice.gc.ca. Security still applies if there's no permanent establishment canada.ca.

A normal registration goes through Form RC1, Request for a Business Number and Certain Program Accounts canada.ca, which a non resident sends by fax or mail to the designated non resident tax services office canada.ca. The simplified regime uses its own online form, which has to be completed in one session, and the business number follows once the CRA validates it canada.ca. Quebec sales raise a separate QST registration question.