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  • Sep 16th, 2018 11:12 am
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[OP]
Member
Nov 8, 2009
225 posts
48 upvotes

Paying HST on US Work

So my GP contracted out some manufacturing work to be done in both Canada and US to a Canadian company. The Canadian company contracted out the work to be done in the US to a US company. The US manufacturing will stay in US.

Would I have to pay HST on the portion of work done in the US?
1 reply
Deal Addict
Jul 3, 2017
3226 posts
2171 upvotes
If the Canadian company is billing you, then they charge you GST/HST on the full amount they are billing you. If they are contracting part of the work to a U.S. company that in turn bills them, that U.S. company doesn't charge them GST/HST, so they don't deduct anything from the net GST/HST they remit to the government for that work. If part of the work is done by a Canadian company that billed them GST/HST, then they would deduct that amount from the net GST/HST they owe to the government. It's a value-added tax, so they're paying tax on the amount of value they added between their costs and what they sold it to you for. They remit GST/HST collected minus GST/HST they paid on the inputs. So do you.

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