Non-Residents ask "How Do I Get the GST/HST Back on Goods Purchased in Canada?"

Non-residents businesses may be entitled to recover GST/HST paid on goods delivered in Canada if the goods are exported within 60 days and if they file the paperwork for a refund/rebate. Generally speaking, non-resident consumers are not able to recover GST/HST paid on goods purchased in Canada. Canada does not have a VAT rebate for visitors who purchase goods.

Non-resident businesses who purchase goods in Canada and arrange for delivery in Canada would complete the general refund application form GST189 to claim a refund.  The rebate ismailed to the Canada Revenue Agency and not handed to the supplier for immediate benefit.

If the non-resident business or consumer allowed the supplier to arrange for shipping of the goods so that the delivery of the goods occurs outside Canada, GST/HST would not be charged.  If goods are delivered in Canada, the supplier must charge the GST/HST because the supplier can no longer control whether the goods actually leave Canada.  I had a case once where the CRA officer said to me 'How do I know that your client did not stop while driving to the United States at a few spots to resell the goods within Canada?'  The reality was, it would be difficult to prove the officer was wrong.

So here are a few examples:

If a non-resident individual comes to Canada and buys clothes and takes delivery at the store, he/she would pay GST/HST to the store and would not recover the GST/HST by way of a rebate.  If that same individual arranges for the store to ship the goods outside Canada, then GST/HST would not be payable.

If a non-resident business purchases clothes from a Canadian manufacturer to be delivered in Canada, exports the goods so that they can be resold outside Canada, the business would pay GST/HST to the Canadian manufacturer and file a rebate claim so long as the goods were exported within 60 days. If the non-resident business purchases clothes from a Canadian manufacturer to be delivered outside Canada (the manufacturer arranges the shipping), the non-resident should not pay GST/HST to the Canadian manufacturer as the transaction is zero-rated.  The non-resident saves the cash flow costs by paying for the manufacturer to ship the goods.

If a non-resident person purchases a classic car at an auction in Canada for the purposes of reselling the car at a later point in time (an adventure or concern in the nature of trade), he/she may claim a refund/rebate if the car is delivered in Canada and GST/HST is paid to the vendor of the car.  If the non-resident purchases classic car to be delivered outside Canada (the supplier arranges the shipping), the non-resident should not pay GST/HST to the Canadian supplier as the transaction is zero-rated. 

If a non-resident takes possession of goods in Canada and plans to export goods and file for a rebate, they must prove that they exported with goods within 60 days.  That means they need paperwork that has been stamped by government authorities relating to the export.  It used to be that the non-resident would present themselves and the goods to the Canada Border Services Agency (CBSA) at the time of export and complete paperwork.  The CBSA says to non-residents that they do not have forms to complete relating to exports (even though there is the E15 Certificate of Destruction/Exportation).  I recommend that the non-resident prepares paperwork and ask the CBSA to stamp the paperwork to acknowledge the request (at least). More importantly, the non-resident should complete the entry paperwork when returning to their home country.  In the United States, the person would complete a form 7901.  This paperwork is good evidence of an import into another country, which usually is accepted as evidence of export from Canada. 

It may take weeks or months to receive the refund/rebate cheque in the mail.  There is an interesting case of a non-resident purchasing a plane and hitting a bird on take-off and having to complete repairs before export.  It took longer than 60 days to repair the plane, the 60 day deadline was missed and the rebate claim was denied by the Canada Revenue Agency and the Tax Court of Canada.

This Blog/Web Site is made available by Cyndee Todgham Cherniak and LexSage Professional Corporation for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand that there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for competent legal advice from a licensed professional attorney in your province.

The law firm LexSage does not have any connection with this Blog/Web Site.

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Comments (8) Read through and enter the discussion with the form at the end
Green - April 19, 2011 9:10 PM

"If the non-resident business or consumer allowed the supplier to arrange for shipping of the goods so that the delivery of the goods occurs outside Canada, GST/HST would not be charged."
I buy ebooks from Kobo Books in Canada and they are delivered to me in Mexico via the internet. Recently they started charged 16% VAT although books are exempt from VAT in Mexico. In response to my questions they tell me the VAT exemption is only for non-electronic books (and not whether it is a Canadian or Mexican stipulation) and have not given a precise justification for their tax charge. So I find your comments very interesting.

Cyndee's response: This 16% charge does not appear to be related to HST. I cannot comment on Mexican taxes.

Norm R Froment - May 16, 2011 4:44 PM

Does a large company that exports it's entire production such as oil, lumber, ore, manufactured goods or anything produced in Canada charge HST to the recipient in their country? Say lumber to Japan, do they pay HST?

Kathleen Piggott - May 20, 2011 7:36 AM

I love receiving your Blog and look forward to finding out just what you'll write about each time you send out a post.Keep up the good work.
Kathleen

Dan Goehle - June 26, 2012 5:19 PM

As a United States citizen if I were to buy a racehorse from a Canadian owner and have it sent immediatly to the United States am I required to pay the HST or is this purchase exempt.If it is exempt what would I need to get from the owner to protect both of us?

Leah - June 28, 2012 7:07 PM

If I am a resident of USA and buy a bike in Canada, where I will be for the next 50 days, when I drive back over the border with my bike at the end of the summer, what form do I give the border official?
Thank you for your help!

tim - July 20, 2012 11:06 AM

If I sell transportation goods to an american company and I charge them GST/HST, can that american company claim the GST/HST on charge for shipping?

Example: My American customer sells 100 books to 100 different individuals in Canada. They ship to me in bulk, I then distribute to each of the addresses shown on the package. Charge them a shipping fee of $10.00 fee plus GST/HST $1.30 per package. Can the American company apply for a refund for the GST/HST on the shipping portion ($1.30) of the transaction. It is part of a continuous inbound shipment?

Ezequiel - November 19, 2012 12:43 AM

Hi Cyndee!

What about international/ESL students?
Are they entitled to claim back HST from goods/groceries/etc they've purchased while in Canada?

Regards,

Ezequiel.

Usman - January 17, 2013 12:42 AM

I am a resident in canada. I do buy buy cars from Canada and sell outside Canada. I sometimes buy cars in Canada for relations outside Canada. Can I claim the GST paid on these car?

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