# Tax in Canada

Use Stripe Tax to calculate, collect and report tax in Canada.

Stripe supports tax calculation for businesses making sales into [Canadian provinces](https://docs.stripe.com/tax/supported-countries/canada/collect-tax.md). The requirements for tax collection, the types of tax collected, and which types of transactions are included, vary from province to province.

For each jurisdiction listed, you can find information about:

- The types of tax Stripe can help you collect.
- The registration threshold that determines when you’re required to register for tax collection.
- What kinds of products or sales are subject to tax calculation.
- The types of transactions covered.
- Resources about how to register with local tax authorities.

## When and how to register for tax collection

The Canadian tax system consists of a combination of federal and provincial taxes. Different rules determine when and how you need to register to collect tax depending on the province. To see each province’s registration resources, go to [Collect tax in Canada](https://docs.stripe.com/tax/supported-countries/canada/collect-tax.md).

Visit the [Needs attention](https://dashboard.stripe.com/tax/locations?primary_tab=needs_attention) tab to get insights about your potential tax registration obligations in each location. Stripe only monitors if you’ve reached a tax threshold for sales outside of the country your business is based in. Stripe also notifies you with email and Dashboard alerts when you might need to register to collect tax. Learn more about how the [monitoring tool](https://docs.stripe.com/tax/monitoring.md) works. After you register with a country, go to [Locations](https://dashboard.stripe.com/tax/locations) in the Dashboard and add your registrations to Stripe to start collecting tax on your transactions in that location.

## How we calculate taxes

Learn how Stripe calculates taxes for your sales in Canada.

### Map your product to our product tax codes

Stripe can calculate tax for the [product tax codes](https://docs.stripe.com/tax/tax-codes.md) in the **Product type** column of the [Supported countries](https://docs.stripe.com/tax/supported-countries.md#supported-countries) table. We determine whether you’re selling [digital products](https://docs.stripe.com/tax/tax-codes.md?type=digital), services or physical goods using the product tax code you assigned to your product. The **All sales** type indicates that Stripe can calculate tax for both domestic and cross-border sales. The **Remote sales** type means that Stripe can only calculate tax for products sold by remote sellers. Digital products are non-physical items or services that are delivered, given, or rendered electronically. This includes digital goods and electronically supplied services. A remote seller means that your origin address in Stripe is in a different country from the country where you’re registered to collect tax.

### Domestic transactions

A transaction where your business and your customer are in the same country is called a domestic transaction. The sale of goods or services is taxable unless the tax authority has specifically made them exempt, zero rated or taxable at a reduced rate.

### Cross-border transactions

A cross-border transaction is one where your customer is located in a different country from your business, or where goods are shipped from one country to another. Stripe calculates tax on a cross-border transaction, taking into account the following factors:

- The location of your business.
- The tax registrations you’ve added to Stripe.
- The location of the buyer.
- The location where the activity is performed.
- The type of the product sold (based on which [product tax code](https://docs.stripe.com/tax/tax-codes.md) you assigned to your product).
- The status of the customer (whether they’re an individual or a business). Digital products are generally taxable in the country where your customer is located. However, sales of digital products to businesses in other countries might have reverse charge applied. With a reverse charge, your business provides an invoice for the purchase so your customer can calculate the tax. When physical goods are shipped to a customer in another country, the transaction is referred to as an export. Exports are zero-rated and Stripe applies the [zero rate](https://docs.stripe.com/tax/zero-tax.md). The transaction might still be subject to taxes and customs duties in the country your customer is in. Stripe doesn’t calculate these.

## Report and file your taxes

Stripe Tax has filing partners – Taxually, Marosa and Hands-off Sales Tax (HOST) – to help automate your tax filing. These partners automatically sync your tax transaction data in real time, eliminating the need for manual data entry or file transfers. Learn more about [tax filing](https://docs.stripe.com/tax/filing.md). Stripe also provides reports of your completed tax transactions. Go to [Locations](https://dashboard.stripe.com/tax/locations) to access these reports. Learn more about [the different types of reports](https://docs.stripe.com/tax/reports.md). You’re responsible for filing and remitting your taxes. Stripe doesn’t file taxes on your behalf.