GST/HST on services: which province and tax rate apply?

A consultant works in Alberta, invoices a business in Ontario and delivers the advice online. Which province determines the GST/HST? “Where I work” and “where the invoice goes” are both tempting shortcuts. Neither is a complete rule for every service.

GST/HST means goods and services tax or harmonized sales tax. The “place of supply” is where a sale is treated as taking place for this tax. The rules vary with what you sell. The Canada Revenue Agency (CRA) published service memoranda in April 2026 to replace the old draft B-103 guidance. An older checklist may therefore cite cancelled guidance. This guide covers ordinary registered suppliers using the regular rules. It does not cover every digital-economy or non-resident situation. It provides general information, not a tax ruling.

Check what you supplied before choosing a province

First identify what was supplied and who the recipient is. A contract might concern advice, a licence, goods, property-related services or more than one component. Calling everything “consulting” on the invoice does not establish that the general service rule applies.

Check how the sale is taxed. An exempt sale is not subject to GST/HST. A zero-rated sale is taxable at 0%, but a specific rule must allow that treatment. You must also check whether the supplier needs to register and charge tax. Those questions do not replace the need to identify the sale's tax category.

Next consider whether the supply is made in Canada under the applicable rules. Provincial place-of-supply analysis should not be used to bypass that step. A foreign customer, foreign payment currency or foreign mailing address does not by itself prove a supply is outside Canada or qualifies as a zero-rated export.

Keep this sequence visible in the working file: actual supply, recipient, tax status, Canadian connection, applicable provincial rule, then rate. It makes later review much easier than a note reading only “customer in Ontario.”

Ask whether a specific service rule takes priority

The general address-based rules are subject to specific rules. CRA's service memorandum describes an order of analysis, including special cases and services tied to property, personal services, transportation and telecommunications. The labels below are prompts to investigate, not an exhaustive summary of the legal conditions.

• Does the service relate to real property or tangible personal property?
• Is it a personal service performed in the physical presence of an individual?
• Does it involve transportation, postage or telecommunications?
• Is it a special case, such as a service connected with litigation or a location-specific event?
• Could the particular computer-related service rules apply?

A remote service is not automatically a general service merely because the supplier never visits the customer. Conversely, using a computer does not automatically make professional advice a specially defined computer-related service. Examine the actual service and the conditions in the relevant memorandum.

If a specific rule applies, follow it. Do not select the general rule because its result is simpler or matches last year's invoice. Where the classification is genuinely uncertain, obtain advice or a CRA interpretation or ruling appropriate to the question.

If the general rule applies, examine the recipient's addresses

General Rule 1 uses the recipient addresses you obtain in the normal course of business. The recipient is generally the person who must pay under the agreement. An employee who receives a report is not necessarily that person.

1. If you obtain only one Canadian home or business address of the recipient, that address generally determines the province.
2. If you obtain more than one such Canadian home or business address, use the one most closely connected with the supply.
3. In other cases where you obtain a Canadian address of the recipient, consider the Canadian address most closely connected with the supply under the rule.

Do not read “billing address” as an unconditional override. It can be relevant, but you must consider the actual addresses obtained and the rule that applies. A multi-office customer can require more analysis than a single-address engagement.

CRA distinguishes a physical address from an email or IP address that does not represent a specific physical location. A post office box is not a business address, although it can be considered another address in the circumstances described by the memorandum. Do not silently substitute an email domain, a phone area code or the payer's bank branch.

Two examples with clear limits

For both examples, assume the supplier is registered under the regular GST/HST rules. The business advice is a taxable supply made in Canada. No exemption, zero-rating or specific service rule applies. The supplier obtains only one Canadian home or business address for the recipient in the normal course of business.

Example A: the consultant is based in Alberta and the recipient's sole relevant Canadian business address is in Ontario. The general rule places this supply in Ontario. For a $2,400 fee subject to the current 13% Ontario HST rate, the tax is $312 and the total is $2,712. The consultant's Alberta office does not turn it into a 5% GST invoice.

Example B: with the same assumptions, a separate recipient's sole relevant Canadian business address is in Nova Scotia. For a supply subject to the 14% HST rate in effect there since April 1, 2025, a $2,400 fee produces $336 tax and a $2,736 total. Reusing an old 15% Nova Scotia setting would be wrong for that assumed current-rate transaction.

These examples deliberately remove exceptions. Change the service, addresses, timing or legal recipient and you must reassess the result. A historical invoice correction requires the rate and rules relevant to that transaction, not necessarily today's rate.

No Canadian address means more analysis, not automatic zero tax

If you do not obtain a Canadian recipient address in the normal course of business, more general rules apply. They examine the Canadian part of the service and where it is performed in provinces that use HST, called participating provinces. Extra tests decide between possible results. Do not automatically use your own province, the customer's foreign location or a zero-rated tax code.

This is a sensible escalation point for a short working memo. Document where the service is performed, what information was actually obtained and whether another specific rule changes the analysis. Do not invent a Canadian address to make the accounting software accept an invoice.

Check separate provincial taxes, too. A result in a province that does not use HST does not rule out Quebec sales tax (QST), provincial sales tax (PST) or other provincial duties. Quebec is non-participating for GST/HST, but QST still needs its own review. Apply each tax system's rules separately.

Write down why you chose the rate

A useful file note records the service description, legal recipient, relevant addresses, source of those facts, rule chosen, exceptions considered and transaction date. Retain the contract or other appropriate evidence without collecting unnecessary personal information. If the client later opens another office, determine whether the facts for the next supply have changed instead of relying forever on the original conclusion.

Configure the invoice in the accounting system only after that decision. Check that the selected code represents the intended rate and tax status, and that the invoice total agrees with the calculation. A software default is not an authoritative place-of-supply decision.

Bookwits can help the firm collect the agreement, assign a question for review and keep the decision with the client's work. It does not choose GST/HST rates or file tax returns. Use it to keep the supporting records and responsible people together, so the next invoice does not require starting the review again.