GST and QST: charging, calculating and checking an invoice
Both taxes use the pre-tax price
In Québec, regular GST is 5% and QST is 9.975%. Since 2013, QST has been calculated on the pre-tax price rather than on an amount including GST. The combined rate is therefore 14.975%. On a $1,000 taxable sale, GST is $50 and QST is $99.75, for a total of $1,149.75. It is useful to show both taxes separately on an invoice so the customer and the business can check the treatment.
The reverse calculation needs a division
To recover the pre-tax amount from the total, use pre-tax = total ÷ 1.14975. Subtracting 14.975% from the total gives a wrong result because the original percentage applied to a smaller base. For example, $1,149.75 ÷ 1.14975 gives back $1,000. The calculator keeps the decimals until the final rounding and shows an adjustment when the components' cents do not perfectly rebuild the entered amount.
| Line | Calculation on $1,000 | Amount |
|---|---|---|
| Pre-tax price | Base | $1,000.00 |
| GST | $1,000 × 5% | $50.00 |
| QST | $1,000 × 9.975% | $99.75 |
| Total | Sum | $1,149.75 |
The $30,000 threshold does not read like a simple annual total
Small supplier status is often summed up as "over $30,000". In practice, you need to examine the relevant worldwide taxable supplies and the period set by the rules. The moment registration becomes mandatory can depend on exceeding the threshold in a quarter or over several consecutive quarters. The NEQ (Québec enterprise number) alone is not registration for the GST and QST files. Check your status with Revenu Québec before you start or stop charging the taxes.
Six items to check on an invoice: Date, supplier identity, customer identity when required, description, amount and the relevant registration numbers. The exact requirements vary with the invoice's value.
Collecting taxes is not earning that amount
A registered business collects taxes to remit them with its returns, after the applicable recovery mechanisms. The total received in the bank account therefore is not entirely available income. A good practice is to regularly set aside the tax portion to avoid a cash shortfall at the due date. The calculator helps isolate GST and QST, but it does not keep a collection register or prepare a return.
Watch sales that do not use both regular rates
Some supplies are zero-rated, exempt or subject to different place-of-supply rules. An invoice can also mix several treatments. In these situations, applying 14.975% to the whole subtotal produces an error. Classify the lines before calculating. If you sell outside Québec, additional rules can determine the applicable tax based on the customer, delivery and service.
- Check your registration status before displaying tax numbers.
- Calculate GST and QST on the same pre-tax base.
- Keep the invoices that support recovered taxes.
- Separate sales that do not follow both regular rates.
The best use of the tool is to check the arithmetic of a transaction whose tax status is already known. To decide whether a sale is taxable, whether the threshold is exceeded or whether a tax is recoverable, consult Revenu Québec or a qualified person with the complete facts.
Frequently asked questions
Is QST calculated on GST?
No. Both regular rates are applied to the pre-tax price.
Does an NEQ mean I must charge taxes?
No. Business registration and tax-file registration are separate steps.
Why do a few cents differ?
The per-line or on-total rounding method can produce a small difference.