Canadian webmasters pushing US affilates - do you have to pay GST? help..
 

omfg this topic is so frustrating...

If you are a canadian webmaster and most of your income comes from US based companies that pay you as an affiliate do you have to pay GST on that income or not?

What about my US based clients that pay me as a consultant do I have to pay gst on that?

Please tell me I don't have to pay this bill I just got for $30,000 for gst :helpme

Call a good tax accountant local to you, they can assist you with this.

DH

thx - but surely there are some canadian webmasters already dealing with this??

Anyone know a goog tax accountant here in vancouver that has experience with this internet cross border bs?

if its REPORTED revenue or income, then it has to be tax. technically govt states that u have to report revenue/income that u made globally.

Way to totally miss what he was talking about.

GST is not income tax.

sooorry, i was looking at bdjufs sweet ride and got carried away.

with the sweet hookups..

so there is no canadian webmasters dealing with this???


wtf same as all the other threads... nobody that can actually say yes or no. :helpme :upsidedow :warning

Quiet has posted about this before. I believe the legality of it is that you would need to pay GST on sales originating inside of Canada. The crux of it is how do you show proof where your sales are actually coming from.

Consulting work, done for American companies should be GST exempt, I believe.

In the end, you're going to need an accountant. You'd be silly to take advice from a message board, really.

GST is not an income tax as was already stated. It's a "goods and services tax" paid when YOU purchase a good or service IN Canada.

You need to re-read whatever you have in front of you, because you're confused. You may owe INCOME tax of $30k, (plausible if you made more then $100k in a year). That said if I had a $30 k tax bill and didn't understand it, I would be seeking professional advice asap.

Thanks Warchild...

I don't own any paysites and most of my affiliates are US based companies... those that are canadian are less than $30k/yr...

I will be consulting an accountant as I don't think rev canada is going to deal with me and so oh ok you don't ow then :/ I just wanted to find out the bottom line if I owe all this $$ or not :/

I rec'd a letter from rev canada saying basically "hey you have been making over $30k for the last few years so you shoudl be collecting gst - here is your number and here is the total you owe us for the last few years (plus interest and penalities) which is $30,000

Just curious, how much of that $30K is interest, and how much is a penalty?

And yeah, you don't have to pay it on affiliate revenue from U.S. based companies.

Double check what warchild said regarding gst on consulting services, GST is taxable on services too, unlike (PST). There is an exception or rebate that for taxes not collected for US customers (due to the free trade required exception to taxes) but you have to fill out some messy paperwork to get.

Wasn't worth it for me, but with 30K bill it probably would be (assuming the loophole still exists)

Here's some stuff to read over that might help you too:

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

Ummm ....

It is my understanding, after consulting a CA here, that the position of the Canadian Government towards electronic comnmerce is the following:

- all sales of services/ecomm done by a canadian corp on line are to be treated as being done INSIDE Canada, so taxable ...
Just like if a canadian store sells goods to an american visiting Vancouver ... It is up to the customer to claim back the gst when he exits the country.

Now, don't give me shit that it doesn't make sense ... I am just giving you the time of the day...

Memberships is the same thing.

The best you can do now:

- get a good accountant
- start looking for a good tax lawyer, that has connections
- try to play the " i didn't know" and hope they have sympathy.
- negotiate a reduce amount ....

http://www.cra-arc.gc.ca/tax/busines...st/menu-e.html

That would apply to running paysites or selling goods online, but does not apply to working as an affiliate for US companies.

Selling goods is not taxable, because you actually ship out the merchandise .. I do this daily, and have shipping documentation to back it up. Believe me, they came to check when I claimed a reimbursement of near 25000.00 for the first year.

As an affiliate, you do not ship out anything, so there position is that the " sponsor" could have been in the country at the time of the transaction, so taxable . Doesn't make sense, but that is the way ( have it in a printed document of 100 pages plus.. don't feel tough like reading and posting this ).

Still, that person should get an accountant.

Some good info here...

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

wtf this contradicts what everyone else is saying...

"all sales of services/ecomm done by a canadian corp on line are to be treated as being done INSIDE Canada, so taxable ..."

But I am not making any sales... I'm being paid commissions by a US company that sold someone a service.

So basically payments from sponsors are for referrals and are the same as me invoicing people for consulting...

Wtf if this is the case then every canadian webmaster using us affiliates for the last few years could get dinged anytime with this same charge...

Sounds like I need a US/offshore corp and have them pay me a salary or something if this is how it is...

Hmmm if you file over 30k self employeed they look for gst automatically don't they? wtf #$%^ :( :mad: :helpme

I read those already and now what direcfiesta is saying contradicts this...

is it really as simple as shwoing them that all my revenue came from US companies?

Here is how it works.

If you sell an item to someone inside Canada then it is subject to GST. If the customer resides inside of your province then you must charge the provincial sales tax as well.

If the customer is outside of Canada they're not subjected to paying tax Canadian taxes.

If you want to fuck with them then technically you don't sell shit. It's the 3rd party processor who completes the sale outside of Canada and sends you the money. Now this leads back to your business collecting funds from a source outside of the country. No GST/PST, But you still need to declare the income.

Righto... the reason they are coming after me for all this money is because I HAVE declared the income...

So wtf do I do know? Just call them and say "hey its all income from usa companies for consulting and referrals" and then prove it?

If it is this black and white they should be like "ok we didnt know it was all from USA companies" ... they just assumed it and gave me a number and sent me a bill.

if you find a good accountant in vancouver, let me know also please

You _SHOULD_ declare it anyways. Always show what you make unless you're doing cash money jobs (not in this biz oviously). ANYONE who clears 30k/year and has a limited or incorperated business will get a GST number.

They're going to want proof. I would start requesting account reconciliations from anyone whos every paid you any $ and isnt canadian based. At this point $30k is a nice chunk of change and they wont drop it.


No, they think you owe them $30K ;) Its worth it to get yourself an accountant just to clear this issue up with them instead of you doing it and messing it up ;)

Great advice ... I just need to remember not to follow this ....

I have friends who move close to $1m in dvd products per year as well as some friends who probably do 50-100k/month in online dvd sales and they BOTH dont do it the way you do.

Are you old enough to read ?????

Sorry, they do it they way I do it, BECAUSE THIS IS HARDGOODS SALE.....

Obviously, you are not able to see the difference between HARDGOODS and services/memberships ...

Let me tell you that the taxman ( Ringo Starr preferred people ) will teach you ....

$ 1.000.000.00 on line in Canada !!!!

I call : BULLSHIT!

Call bullshit all you want. Assume all you want too because that is exactly what you're doing. I never said either one of my friends sold products just in Canada which is why I think I may know what I'm talking about.

The DVD retailer has does large in the UK as well as in the US. My other friends distribute product worldwide as well as own their own lines.

Amazing they're still in business according to you.

You assume that I assume ... I didn't. I understood that you claim that he sells DVD"s for over 1.000.000.00 in the whole world on line... i still say BS.... I have been in this business linguer than you have lived .... Do you know of Mile-High, Showtime, Kaytel, Jade, etc .. They rtep the biggest US lines and don't do a tenth of that on line... Your friend is pulling your dick.

I sell DVD's ,VHS-NTSC and VHS-PAL worldwide ... You know what PAL is ??? it is not your friend....


And on the GST issue, you were wrong, and obviously are ignoring it .

If you search the power sellers on ebay long enough you will find some that move 200-300k dvd's a year just through ebay.

CANADIANS ????? give examples... I listed above the 4 biggest adult distributor in the country ...
Showtime: Evil Angel, New Sensations, Ultimate pics, Kic Ass , Hot Box, Digital Sin, Shaynes world, etc ...
Kaytel : leisure time, Elegant Angel, Red Ligh District ...
milehigh : their own Dog House productions, Metro prods, 100 releases a month!
jade : devil's film, jet multimedia, temptations,filmco ...
Transvideo : bunch of lines

These guys, all together, dont do half that on line ...

Still waiting for names ??? or one name ???

Bestvideos.com

Adult ????

I wasn't talking about adult. I'm not sure about the person who said they have a friend who moves a million in dvd's but I assumed they meant mainstream as well.

Maybe... We will never now... it's past nine, so his mommy sent him to bed :winkwink:

My Accountant doesn't agree with Directfiesta's.

Hehe,

I *am* an accountant, and in my real job I implement complex software and I make sure that the taxes work properly.

I am not in public practice.

I can tell you that income as an affiliate is very ambiguous. I am pretty sure CCRA has not written an opinion, and it has not been tested in court.

I would argue that you are a sales agent earning a commission from foreign sales.

That is not good. Because you are doing the work in Canada you have to charge your client GST. That means that if you make $25 you have to account for it as 23.36 of revenue and 1.64 of GST.

The web site can register for the gst and get the 1.64 back. If you are significant enough, they may be willing to do this and pay you 26.75. And get 1.75 back.

Since doing it properly, Rev Can gets nothing they may not push it if they are otherwise happy with you. That means paying your income taxes.

But who knows? There is no precedent.

Some of you are retarded, the answer to the original question is simple, NO, you do not have to submit GST on a payment that originates from the US.

Get a written opinion, backed by firm if he works for one. If not, ask him if he has liability insurrance ...

Otherwise, you will do like I did 10 years ago after my divorce:

- sit in a small cubicle office, with a lousy table a 4 chairs.
- In front, two fucking tax people that belive that you are scum and rich
- Besides you, your bankruptcy syndic...
- Practically on the table, but no quite yet, a 4999.00 bank draft in blank, that you make sure to flash around

When the proper time comes, you state:

" I have a problem here. This draft, which name I write on the line of the payee... Revenue Canada or my syndic "...

:2 cents:

Paul, you are right, and the job of the taxman is to create and collect taxes, not to be fair to you ...

:1orglaugh :1orglaugh :1orglaugh