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This article applies to selling in: Canada

Canadian sales taxes on Amazon.ca Seller Fees

Important: The information provided on this page does not constitute tax, legal, or other professional advice and must not be used as such. You should consult your professional tax advisor if you have questions about your tax obligation.

Effective July 1, 2021, the Amazon entities currently selling services to sellers on the Amazon.ca store are changing.

  • Selling on Amazon (SoA) services will change from Amazon Services International, Inc to Amazon.com.ca, Inc.
  • Advertising services will change from Amazon Advertising to Amazon Advertising Canada, Inc.

This change may affect the taxability of your seller fees on Amazon.ca. More details are provided below.

Why does Amazon collect sales tax on seller fees?

Some Selling on Amazon (SoA) fees such as per item, order, and referral fees, may be taxable services. Similarly, advertising fees, and Fulfilment by Amazon (FBA) service fees, such as pick & pack, and shipping fees may also be taxable. To comply with federal and provincial tax laws, Amazon.com.ca collects and remits sales tax for SoA, Advertising, and FBA fees charged, when applicable.

Which seller fees are considered taxable?

Amazon offers many services and programs to sellers, and fee taxability varies based on a combination of the type of service(s) purchased, the Amazon entity providing the service(s), federal and provincial tax laws, your participation in Tax Calculation Service (TCS), business information you supply to Amazon, including your federal/provincial registration number, the location of your business, and/or where an FBA service is performed.

To understand the different service fees, see our fee schedules:

Selling on Amazon fee schedule

FBA fulfilment fees

Advertise with Amazon

What are the different taxes Amazon may collect on my seller fees?

The different Canadian sales tax are Goods and Services Tax/Harmonized Sales Tax (GST/HST); British Columbia Provincial Sales Tax (BC PST); Saskatchewan Provincial Sales Tax (SK PST); Manitoba Retail Sales Tax (MB PST); and/or Quebec Sales Tax (QST).

  • GST/HST + PST collectively is “sales tax”
  • BC PST, SK PST, MB PST, and QST collectively is “PST”

Current tax rates are listed in the Federal and provincial sales taxes section of the Canada tax and regulatory considerations help page.

When does Amazon charge tax on my seller fees?

The charts below illustrate when an Amazon.ca seller fee may be subject to sales tax in various Canadian jurisdictions.

Seller business location Canada GST/HST PST
Alberta

Taxable

-
British Columbia

Taxable

Manitoba Not-taxable
New Brunswick -
Newfoundland -
Northwest Territories -
Nova Scotia -
Nunavut -
Ontario -
Prince Edward Island -
Quebec

Taxable

Saskatchewan Not-taxable (excluding any monthly seller subscription fees which will be taxable)
Yukon -

If Marketplace Tax Collection applies to your shipment, GST/HST will be zero rated on your Amazon.ca per-order related SoA fees (for example, the referral fee, variable closing fee, tax calculation service fee, and other per-order item fees).

Amazon Advertising (ads) fees

(based on your business location)

Seller business location Canada GST/HST PST
Alberta Taxable -
British Columbia Taxable (except Managed Ads fees)
Manitoba Not-taxable
New Brunswick -
Newfoundland -
Northwest Territories -
Nova Scotia -
Nunavut -
Ontario -
Prince Edward Island -
Quebec -
Saskatchewan Not taxable (except managed ads fees)
Yukon -

Fulfilment by Amazon (FBA) service fees

(based on the fulfilment centre location)

Order fulfilment centre location Canada GST/HST PST
Alberta Taxable -
British Columbia -
Ontario -
Quebec Taxable
If Marketplace Tax Collection applies to your shipment, GST/HST will be zero rated on your Amazon.ca per-order related FBA service fees (for example, the pick & pack fee, shipping commission, and other per-order FBA fees).

The following examples illustrate how Canadian sales tax may be calculated on your selling fees:

  1. If your business is located in Quebec and your sales tax rate is 14.975% (rate may vary), and you sell an item with a total price of $20 with a 15% referral fee (fee % may vary based on product type), we will collect and remit $0.45 tax on the $3.00 referral fee to comply with federal and provincial law (calculated as 5% GST + 9.975% QST on $3.00 referral fee). If you have not provided your GST/HST registration to Amazon, only QST will apply (calculated as 9.975% QST on $3.00 referral fee).
  2. If your business uses Fulfilment by Amazon, the tax rate at the fulfilment centre (FC) applies. An order fulfilled from an Ontario fulfilment centre where the tax rate is 13% HST (rate may vary based on FC location) with an FBA pick & pack fee of $7.00 and shipping chargeback fee of $6.00 (fee application and amounts will vary per order), we will collect and remit $1.69 sales tax to comply with federal and provincial law (calculated as 13% HST on $7.00 FBA pick & pack fee, and on $6.00 shipping chargeback fee). If you have not provided your GST/HST registration to Amazon, then GST/HST will not apply.

A seller fee can become taxable or non-taxable without prior warning or notice when a variable change occurs (supplying/updating your own information, and/or Amazon entity change, and/or a legislative/regulatory change).

My business is located outside Canada, why am I paying tax on my Amazon seller fees?

Canada Fulfilment by Amazon (FBA) service fees are subject to Canadian sales tax at the tax rate of the fulfilment centre providing fulfilment service(s), regardless of your business location.

Selling on Amazon (SoA) and advertising fees are typically subject to taxes where the seller is located.

Amazon determines if a particular country tax rule or regulation applies to a seller fee using the business information supplied in your seller account. See your business information, VAT Information page, and/or search VAT, GST, or your country name in Seller Central help to locate additional information.

Is sales tax on seller fees paid by me or the customer (buyer)?

Seller fees and applicable sales tax for services purchased from Amazon (seller fee) are paid by the seller and are unrelated to any sales tax calculated on products you sell to buyers.

Can I receive a refund of tax collected on my fees?

Seller fees refunded in their entirety will include applicable sales tax with the refund. Otherwise, Amazon is unable to refund sales tax collected on seller fees.

Sellers may have an option to claim a tax credit when filing with the tax authority.

Tax credit options will vary by individual seller and we encourage you to work with your tax advisor or tax authority to learn more about your tax filing options. The Amazon Service Provider Network is also an option if you are looking for a tax professional.

My business is exempt or I have an exemption, how do I become exempt from tax on my taxable fees?

At this time, we are unable to automatically process an exemption for a taxable seller fee. If you have a tax exemption for your business, you may contact Selling Partner Support to provide details about your exemption and how it applies to a seller fee. A tax-only refund review will be requested, based on the information you supply.

Can I opt out of using FBA fulfilment services that may be taxable?

Fulfilment services are performed based on your participation in the FBA program and are always taxable.

You can manage your FBA settings here. To learn more, visit FBA fulfilment fees. FBA fulfilment fees

Will I receive an invoice for taxes paid on fees?

Yes. A monthly seller fee invoice will be generated for each service fee type (Selling on Amazon (SOA) fees, product advertising (ads) fees, and FBA fulfilment service) when Canadian sales tax is collected.

Additionally, order transaction detail page will reflect applicable sales tax paid on seller fees.

If no sales tax is collected on your seller fee, a seller fee invoice is not expected.

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