What To Know
- If you are a Canadian business that uses Mailchimp, you are responsible for reporting the HST you collect on your Mailchimp invoices to the CRA.
- If you have a paid Mailchimp account and you are located in Canada, your account is subject to HST.
- Yes, you can claim an HST refund from the CRA if you are exempt from paying HST or if you overpaid HST.
Harmonized Sales Tax (HST) is a combined federal and provincial tax applied to most goods and services in Canada. As a business owner, it’s crucial to understand if your online marketing tools, such as Mailchimp, are subject to HST. This blog post delves into the complexities of Mailchimp’s HST policy, providing clear answers and valuable insights.
Mailchimp’s HST Policy
Yes, Mailchimp charges HST on its services in Canada. This is because Mailchimp is a foreign supplier that provides digital services to Canadian customers. According to the Canadian Revenue Agency (CRA), foreign suppliers are required to collect and remit HST on taxable supplies made to Canadian residents.
Determining HST Liability
The HST liability for Mailchimp services depends on the type of account you have:
- Free Account: Free Mailchimp accounts are not subject to HST.
- Paid Account: Paid Mailchimp accounts are subject to HST if the account holder is located in Canada.
HST Rates
The HST rate varies depending on the province or territory where the services are being used:
- Ontario: 13%
- Nova Scotia: 15%
- New Brunswick: 15%
- Prince Edward Island: 15%
- Newfoundland and Labrador: 15%
- Manitoba: 13%
- Saskatchewan: 6%
- Alberta: 5%
- British Columbia: 7%
- Yukon: 5%
- Northwest Territories: 5%
- Nunavut: 5%
How to Pay HST
Mailchimp automatically calculates and adds HST to invoices for paid accounts in Canada. The HST amount will be displayed on your invoice and will be remitted to the CRA by Mailchimp.
HST Exemptions
There are certain situations where you may be exempt from paying HST on Mailchimp services. These include:
- If you are a registered charity or non-profit organization.
- If you are a government agency.
- If you are a non-resident of Canada who is not carrying on business in Canada.
Reporting HST
If you are a Canadian business that uses Mailchimp, you are responsible for reporting the HST you collect on your Mailchimp invoices to the CRA. You can do this by filing a GST/HST return.
Impact on Your Business
The HST implications of using Mailchimp can impact your business budget and tax obligations. It’s important to factor in the HST cost when considering Mailchimp’s services.
Summary: Clarity and Compliance
Understanding Mailchimp’s HST policy is essential for Canadian businesses. By adhering to the regulations and reporting requirements, you can ensure compliance and avoid any potential penalties.
Frequently Asked Questions
Q: How do I know if my Mailchimp account is subject to HST?
A: If you have a paid Mailchimp account and you are located in Canada, your account is subject to HST.
Q: Can I claim an HST refund if I am not required to pay HST?
A: Yes, you can claim an HST refund from the CRA if you are exempt from paying HST or if you overpaid HST.
Q: How can I get a copy of my Mailchimp invoice with HST included?
A: You can download your Mailchimp invoice from your account dashboard. The invoice will include the HST amount.
Q: What is the deadline for filing a GST/HST return?
A: The deadline for filing a GST/HST return depends on your filing frequency. Most businesses are required to file quarterly.
Q: Can I use my Mailchimp invoices as proof of HST paid?
A: Yes, Mailchimp invoices can be used as proof of HST paid to the CRA.
