Quick Answer
Digital products sold to Canadian consumers are generally subject to GST/HST. As of 2021, foreign digital product sellers must also register for GST/HST if selling over $30,000 to Canadian consumers. Canadian creators who sell digital products must register once they hit the threshold and charge the appropriate rate.
Digital products — e-books, Notion templates, Canva templates, Lightroom presets, music samples, software, plugins — are subject to GST/HST when sold to Canadian consumers. The rules have been updated significantly since 2021 to capture both Canadian and foreign sellers of digital products.
Are Digital Products Taxable in Canada?
Yes. The CRA classifies most digital products as intangible personal property or electronic services, both of which are taxable supplies subject to GST/HST. Exceptions (zero-rated) include certain educational materials used in accredited courses.
GST/HST Rules for Canadian Digital Product Sellers
If you're a Canadian resident selling digital products and your total revenue exceeds $30,000 in 12 months, you must register for GST/HST and charge it on sales to Canadian customers. The rate depends on the buyer's province (5% GST in Alberta, 13% HST in Ontario, etc.).
Where Are Digital Products "Supplied"?
For GST/HST purposes, digital products are generally considered supplied where the recipient is located. This means you charge based on your Canadian customer's province, not your own location.
International Sales of Digital Products: Zero-Rated
Digital products sold to non-Canadian customers are generally zero-rated (0% GST/HST) if the recipient is outside Canada and the supply is made primarily for consumption outside Canada. Keep evidence of the buyer's non-Canadian address for each export sale. US Etsy customers, US Gumroad buyers, etc. should not have Canadian GST/HST charged.
MaxRefund Manages GST/HST for Canadian Digital Product Sellers
We register Canadian digital product creators for GST/HST and handle all filings — so you can focus on creating.
Get a Free Quote