Canadian Wemasters and GST - GoFuckYourself.com

daveylapoo · 09-06-2004, 08:09 PM

Just pulled up this thread while looking into the GST thing:

http://www.gofuckyourself.com/showth...&highlight=gst

I may have misinterpreted it, but noticed that WiredGuy mentioned something about not having to collect/pay GST. In the same thread, Quiet mentioned that he did pay GST.

As a Canadian Webmaster who is paid largely by US companies, hows all this gonna work come year end? Are cheques from the US companies considered 'GST inlcluded' and one must pay based on overall revenue, or is there another way this can be structured?

Damn, I started this for fun......and now tax issues....lol.

Thanks in advance fellow canucks.

AndrewKanuck · 09-06-2004, 08:10 PM

get an accountant.

daveylapoo · 09-06-2004, 08:15 PM

I do have accountants from my previous business and will likely stay with them for numerous obvious reasons. Just wondering if anyone has first hand info on the GST thing.

WiredGuy · 09-06-2004, 08:20 PM

Quote:

Originally posted by daveylapoo
I may have misinterpreted it, but noticed that WiredGuy mentioned something about not having to collect/pay GST. In the same thread, Quiet mentioned that he did pay GST.

Yes, you misinterpreted it. Read it again and consult an accountant.

WG

dready · 09-06-2004, 08:21 PM

If your cash is coming from us, no worries... if any comes from Canada and it's over $35k/yr you have to report.

Steen2 · 09-06-2004, 08:23 PM

Quote:

Originally posted by egonetworks
get an accountant.

Vitasoy · 09-06-2004, 08:24 PM

Quote:

Originally posted by dready
If your cash is coming from us, no worries... if any comes from Canada and it's over $35k/yr you have to report.

You gotta be joking right?

daveylapoo · 09-06-2004, 08:28 PM

It's interesting, because I've worked in the US and had to pay a Canadian Management firm commisions, with GST over and above even though I obviously could not charge for it myself.

The logic being that although they were providing a service to a US based individual, the fact remained they were a Canadian company making over 35k a year and had to charge it.

Appears to be the same...

psyko514 · 09-06-2004, 08:40 PM

you have to pay the GST.

daveylapoo · 09-06-2004, 08:46 PM

Well shucks, there goes 7%, less input tax credit I guess.

WiredGuy · 09-06-2004, 08:58 PM

Quote:

Originally posted by daveylapoo
Well shucks, there goes 7%, less input tax credit I guess.

Talk to an accountant, you'd be surprised how effective they are.
WG

quiet · 09-06-2004, 09:00 PM

yes, talk to an accountant. wg and i are in different situations. i was gst audited several years ago and it was determined that i MUST pay GST on all membership to my paysites.

obviously this can vary from case to case, and WG does not even come close to running paysites.

psyko514 · 09-06-2004, 09:00 PM

Quote:

Originally posted by WiredGuy
Talk to an accountant, you'd be surprised how effective they are.
WG

yeah, he seemed to avoid that advice 3-4 times, so i figured telling him straight out to pay it would be the safest thing for him.

daveylapoo · 09-06-2004, 09:41 PM

Quote:

Originally posted by psyko514
yeah, he seemed to avoid that advice 3-4 times, so i figured telling him straight out to pay it would be the safest thing for him.

I mentioned that I DO have an accountant from a previous 'self emploted' venture. My earning were in excess of $35k, and I paid GST, but not without taking advantage of the input tax credit. They actually wrote a program that determines whether it is advantageous to go the quick method route, or to deduct all business GST related expenses.

I'm also aware of all the right offs that are available to me, as I work out of the home, as I'm sure several of you do. I may also incorporate with my spouse who does entertainment management and form a 'Multimedia Management' firm that will allow us both to maximize tax benefits.

This is my first year as a webmaster, and WILL be getting help from my accountants who have done wonders for me in the past. I was just wondering if there was something I didn't know about, but thanks for the advice.

SleazyDream · 09-06-2004, 10:24 PM

death and taxes - no way out

rickholio · 09-06-2004, 11:51 PM

Disclaimer: I'm not an accountant. If you do any serious business, you'll need one anyways. So, go get one. A good one. One that eats sleeps and shits tax stuff. You'll be glad you did.

When dealing with cross-border sales (canada into US) the CCRA considers it "zero rated", that is, not GST-able. My business involves sales of my services to corporations in the US, and thus I pay no GST. I still get the benefit of being able to reclaim GST on business expenses (business related expenses and purchases are effectively GST-free).

However, if you do business within Canada with other Canadians beyond a certain amount (I believe it's 35k/year) you need to collect and remit GST.

At least, this is how I understand it based on what my accountant tells me. YMMV.

WiredGuy · 09-06-2004, 11:54 PM

Quote:

Originally posted by rickholio
Disclaimer: I'm not an accountant. If you do any serious business, you'll need one anyways. So, go get one. A good one. One that eats sleeps and shits tax stuff. You'll be glad you did.

When dealing with cross-border sales (canada into US) the CCRA considers it "zero rated", that is, not GST-able. My business involves sales of my services to corporations in the US, and thus I pay no GST. I still get the benefit of being able to reclaim GST on business expenses (business related expenses and purchases are effectively GST-free).

However, if you do business within Canada with other Canadians beyond a certain amount (I believe it's 35k/year) you need to collect and remit GST.

At least, this is how I understand it based on what my accountant tells me. YMMV.

You are correct. It's a little different if you operate a paysite though. You need to track who is Canadian and who is not. if you cannot, CCRA will assume 100% of your members are Canadian. I have a whitepaper that explains it really well, but its in paper form from the settlement I entered into with the government and I'm too lazy to scan it.

WG

ronaldo · 09-07-2004, 12:00 AM

The easiest way to put this is like this.....

If you're simply an affiliate and receiving commission cheques from US companies you'll pay your regular income taxes, and you'll be able to deduct any GST expenses you've paid, like a normally contractor, regardless of where in the world you work.

IF you're a paysite owner and COLLECTING MONEY from the "End user" online, you'll be obligated to collect/pay the GST on EVERY customer purchase, regardless of where they're actually purchasing from.....UNLESS you can prove that the people purchasing your "Product" do NOT live in Canada. IF you can prove that they do NOT live in Canada, you shouldn't have to collect/pay the GST on their purchases.

Speak to Largecash about the latter situation.

Edit-WG-Sorry, you posted as I was typing. Pretty much the same answer as I see it.

WiredGuy · 09-07-2004, 12:01 AM

Quote:

Originally posted by ronaldo
The easiest way to put this is like this.....

If you're simply an affiliate and receiving commission cheques from US companies you'll pay your regular income taxes, and you'll be able to deduct any GST expenses you've paid, like a normally contractor, regardless of where in the world you work.

IF you're a paysite owner and COLLECTING MONEY from the "End user" online, you'll be obligated to collect/pay the GST on EVERY customer purchase, regardless of where they're actually purchasing from.....UNLESS you can prove that the people purchasing your "Product" do NOT live in Canada. IF you can prove that they do NOT live in Canada, you shouldn't have to collect/pay the GST on their purchases.

Speak to Largecash about the latter situation.

Correct.
WG

rickholio · 09-07-2004, 12:18 AM

Quote:

Originally posted by WiredGuy
You are correct. It's a little different if you operate a paysite though. You need to track who is Canadian and who is not. if you cannot, CCRA will assume 100% of your members are Canadian. I have a whitepaper that explains it really well, but its in paper form from the settlement I entered into with the government and I'm too lazy to scan it.

WG

Can that proof be provided in the form of geospatial IP matching? "This purchase came from this IP which is clearly not assigned to CIRA", etc?

WiredGuy · 09-07-2004, 12:20 AM

Quote:

Originally posted by rickholio
Can that proof be provided in the form of geospatial IP matching? "This purchase came from this IP which is clearly not assigned to CIRA", etc?

Ask Quiet, he'd have more experience in that area. I don't own paysites so I didn't have to provide such evidence.

WG

daveylapoo · 09-07-2004, 10:46 AM

Thanks to all who have replied.

I made the mistake of not hiring a good accountant when I first became self employed. Since I've been with them, life has been much smoother.

My apologies that I didn't state my personal situation.

My activity is soley based on promoting affiliate programs. 95% of them are based in the US. I am not a paysite owner, just an affiliate.

I pulled this up from the CRA site:

http://www.cra-arc.gc.ca/E/pub/gm/4-...htm#P235_12992

Advertising services
Sch. VI, Part V, s 8

25. A supply of a service of advertising made to a non-resident person who is not registered for purposes of the GST/HST at the time the service is performed is zero-rated.

Meaning of advertising service

26. An advertising service is generally considered by the Department to be

creating a message
(a) a service of creating a message oriented towards soliciting business, attracting donations, or calling public attention in the form of an information notice, a political announcement or other similar communication by any means including oral, written, or graphic statements and representations disseminated by any means, including,

(i) in a newspaper or other publication,

(ii) on radio or television,

(iii) in a notice, handbill, sign, catalogue, or letter, and

(iv) on a billboard or on real property; and

communicating a message
(b) a service directly related to the communication of such a message (e.g., air time on a broadcasting service, space in a publication) where,

(i) the communication service is supplied as part of the supply of a message as defined in paragraph (a) above, or

(ii) the person providing the communication service can demonstrate that, at the time the supply is made, the service is in relation to the supply of a message as defined in paragraph (a) above.

27. There are occasions where the person broadcasting or communicating a message, within the meaning of subparagraph (b) above, will not be the same person supplying the message (i.e., the creative aspect). Generally, the person supplying the broadcast or communication service will be in possession of the message or will have received sufficient information as to the content of the message prior to the supply of the service to know that the message is in the nature of advertising. In these situations, the supply of the broadcast or communication service will be considered to be a supply of an advertising service.

Am I barking up the right tree here?

RegUser · 03-13-2005, 10:03 AM

Voila
Wait a second
I studied the CCRA site in detail about this GST thing and also spoke to some folks out there.
What I uncerstand is that you need NOT pay GST/PST on non canadian subscribers provided they furnished a non canadian address plus you made them agree to the fact that whatever they download is prohibited form using in Canada.
There is no bloody way a webmaster can pay 15 GST/PST plus 16% processing fee plus 5% holdback fee plus 30% tax plus cost of webhosting and content and expect to make any money!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
For heaven's sake are there any webmasters here who have actually dealt with this stuff in Canada?????????????????????????????????????????
Please share your actual experience not your perceptions

RegUser · 03-14-2005, 04:22 AM

?
anybody?

Daymare · 03-14-2005, 06:08 AM

Well if you're processing in the states you likely have a business setup there, and that business pays US taxes. Your payment as the operator (living in Canada) would be a payroll expense on the US company; and as far as I know, that's just income like working for any job. You pay income tax on it, but not gst. If you're not setup this way, then I'm not sure.

09-06-2004, 08:09 PM	#1
daveylapoo Confirmed User Join Date: Dec 2003 Posts: 423	Canadian Wemasters and GST Just pulled up this thread while looking into the GST thing: http://www.gofuckyourself.com/showth...&highlight=gst I may have misinterpreted it, but noticed that WiredGuy mentioned something about not having to collect/pay GST. In the same thread, Quiet mentioned that he did pay GST. As a Canadian Webmaster who is paid largely by US companies, hows all this gonna work come year end? Are cheques from the US companies considered 'GST inlcluded' and one must pay based on overall revenue, or is there another way this can be structured? Damn, I started this for fun......and now tax issues....lol. Thanks in advance fellow canucks.

09-06-2004, 08:10 PM	#2
AndrewKanuck Confirmed User Join Date: Jan 2004 Location: Cleveland & Atlanta Posts: 6,706	get an accountant. __________________

09-06-2004, 08:21 PM	#5
dready Confirmed User Industry Role: Join Date: Oct 2002 Location: Toronto, ON Posts: 5,247	If your cash is coming from us, no worries... if any comes from Canada and it's over $35k/yr you have to report. __________________ ICQ: 91139591

09-06-2004, 08:40 PM	#9
psyko514 See sig. Join Epic Cash. Join Date: Oct 2002 Location: Montreal, Quebec. ICQ: 214702014 Posts: 22,366	you have to pay the GST. __________________ Bad Girl Bucks - 50% Revshare through CCBill. Promote BrandyDDD, Pixie's Pillows, Action Allie and more! Phoenix Forum Pics \| Webmaster Access Montreal pics email: psyko514(a)gmail.com \| icq: 214-702-014

09-06-2004, 09:00 PM	#12
quiet we'll miss you our friend. RIP Industry Role: Join Date: Sep 2001 Location: Fernie, BC Posts: 25,115	yes, talk to an accountant. wg and i are in different situations. i was gst audited several years ago and it was determined that i MUST pay GST on all membership to my paysites. obviously this can vary from case to case, and WG does not even come close to running paysites. __________________ we'll miss you our friend. RIP

09-06-2004, 08:15 PM	#3
daveylapoo Confirmed User Join Date: Dec 2003 Posts: 423	I do have accountants from my previous business and will likely stay with them for numerous obvious reasons. Just wondering if anyone has first hand info on the GST thing.

09-06-2004, 08:28 PM	#8
daveylapoo Confirmed User Join Date: Dec 2003 Posts: 423	It's interesting, because I've worked in the US and had to pay a Canadian Management firm commisions, with GST over and above even though I obviously could not charge for it myself. The logic being that although they were providing a service to a US based individual, the fact remained they were a Canadian company making over 35k a year and had to charge it. Appears to be the same...

09-06-2004, 08:46 PM	#10
daveylapoo Confirmed User Join Date: Dec 2003 Posts: 423	Well shucks, there goes 7%, less input tax credit I guess.

09-06-2004, 10:24 PM	#15
SleazyDream I'm here for SPORT Industry Role: Join Date: Jul 2001 Location: Phone # (401) 285-0696 Posts: 41,470	death and taxes - no way out __________________ This dog, is dog, a dog, good dog, way dog, to dog, keep dog, an dog, idiot dog, busy dog, for dog, 20 dog, seconds dog! Now read without the word dog.

09-06-2004, 11:51 PM	#16
rickholio Confirmed User Industry Role: Join Date: Jan 2004 Location: Nor'easterland Posts: 1,914	Disclaimer: I'm not an accountant. If you do any serious business, you'll need one anyways. So, go get one. A good one. One that eats sleeps and shits tax stuff. You'll be glad you did. When dealing with cross-border sales (canada into US) the CCRA considers it "zero rated", that is, not GST-able. My business involves sales of my services to corporations in the US, and thus I pay no GST. I still get the benefit of being able to reclaim GST on business expenses (business related expenses and purchases are effectively GST-free). However, if you do business within Canada with other Canadians beyond a certain amount (I believe it's 35k/year) you need to collect and remit GST. At least, this is how I understand it based on what my accountant tells me. YMMV.

09-07-2004, 12:00 AM	#18
ronaldo Confirmed User Join Date: Jan 2002 Location: ICQ#: 272000271 Posts: 5,475	The easiest way to put this is like this..... If you're simply an affiliate and receiving commission cheques from US companies you'll pay your regular income taxes, and you'll be able to deduct any GST expenses you've paid, like a normally contractor, regardless of where in the world you work. IF you're a paysite owner and COLLECTING MONEY from the "End user" online, you'll be obligated to collect/pay the GST on EVERY customer purchase, regardless of where they're actually purchasing from.....UNLESS you can prove that the people purchasing your "Product" do NOT live in Canada. IF you can prove that they do NOT live in Canada, you shouldn't have to collect/pay the GST on their purchases. Speak to Largecash about the latter situation. Edit-WG-Sorry, you posted as I was typing. Pretty much the same answer as I see it. Last edited by ronaldo; 09-07-2004 at 12:04 AM..

09-07-2004, 10:46 AM	#22
daveylapoo Confirmed User Join Date: Dec 2003 Posts: 423	Thanks to all who have replied. I made the mistake of not hiring a good accountant when I first became self employed. Since I've been with them, life has been much smoother. My apologies that I didn't state my personal situation. My activity is soley based on promoting affiliate programs. 95% of them are based in the US. I am not a paysite owner, just an affiliate. I pulled this up from the CRA site: http://www.cra-arc.gc.ca/E/pub/gm/4-...htm#P235_12992 Advertising services Sch. VI, Part V, s 8 25. A supply of a service of advertising made to a non-resident person who is not registered for purposes of the GST/HST at the time the service is performed is zero-rated. Meaning of advertising service 26. An advertising service is generally considered by the Department to be creating a message (a) a service of creating a message oriented towards soliciting business, attracting donations, or calling public attention in the form of an information notice, a political announcement or other similar communication by any means including oral, written, or graphic statements and representations disseminated by any means, including, (i) in a newspaper or other publication, (ii) on radio or television, (iii) in a notice, handbill, sign, catalogue, or letter, and (iv) on a billboard or on real property; and communicating a message (b) a service directly related to the communication of such a message (e.g., air time on a broadcasting service, space in a publication) where, (i) the communication service is supplied as part of the supply of a message as defined in paragraph (a) above, or (ii) the person providing the communication service can demonstrate that, at the time the supply is made, the service is in relation to the supply of a message as defined in paragraph (a) above. 27. There are occasions where the person broadcasting or communicating a message, within the meaning of subparagraph (b) above, will not be the same person supplying the message (i.e., the creative aspect). Generally, the person supplying the broadcast or communication service will be in possession of the message or will have received sufficient information as to the content of the message prior to the supply of the service to know that the message is in the nature of advertising. In these situations, the supply of the broadcast or communication service will be considered to be a supply of an advertising service. Am I barking up the right tree here?

03-13-2005, 10:03 AM	#23
RegUser Confirmed User Join Date: Nov 2004 Posts: 1,472	Voila Wait a second I studied the CCRA site in detail about this GST thing and also spoke to some folks out there. What I uncerstand is that you need NOT pay GST/PST on non canadian subscribers provided they furnished a non canadian address plus you made them agree to the fact that whatever they download is prohibited form using in Canada. There is no bloody way a webmaster can pay 15 GST/PST plus 16% processing fee plus 5% holdback fee plus 30% tax plus cost of webhosting and content and expect to make any money!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! For heaven's sake are there any webmasters here who have actually dealt with this stuff in Canada????????????????????????????????????????? Please share your actual experience not your perceptions

03-14-2005, 04:22 AM	#24
RegUser Confirmed User Join Date: Nov 2004 Posts: 1,472	? anybody?

03-14-2005, 06:08 AM	#25
Daymare Confirmed User Industry Role: Join Date: Feb 2002 Posts: 2,674	Well if you're processing in the states you likely have a business setup there, and that business pays US taxes. Your payment as the operator (living in Canada) would be a payroll expense on the US company; and as far as I know, that's just income like working for any job. You pay income tax on it, but not gst. If you're not setup this way, then I'm not sure.