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  1. #1

    things to do when starting a new online business in Canada

    Hi guys,

    I'm starting a new online business in Canada and I am wondering what I need to get started.

    I've started an unrelated business in Vancouver before, and I need to get a business license, get a GST number, and whatever product i sold, I had to collect GST on behalf of the government.

    Now for online businesses, My target market will include people in asia (namely buyers from korea and japan), and I don't think they will be too happy about paying tax for a different country.

    My question is, how does it work? Do i need a business license/GST number for online businesses as well?

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  2. #2
    You DO need a business license regardless. As far as the GST number, there are a couple things to consider to answer that question:

    1) Is your revenue more than $30,000 per year? Not WILL it be, IS IT NOW? You do not have to charge GST until you KNOW that you are selling $30k per year.

    2) You only need to charge GST and/or PST to Canadian businesses. You do not need to remit taxes on foreign accounts. However, you will need to look into the taxation laws in the countries you are selling to. They may require you to pay some kind of income taxes to their countries.

    Good luck. Let me know if you want to meet up for a drink., a Digitally Justified Company
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  3. #3
    thanks again vanhost.

    if we do get a business license, then we will be charging GST because we will make over 30k a year.

    but this leads me to think, Why should I get a business licnese here in Vancouver, and why not from Toronto? And one step further, why would anyone know where the business is being run from? The only trace would be where the money goes when client makes a payment, and in our case it would be to PSIGate and eventually to a canadian account. (i am still signing up the PSIGate account with you VanHost , very soon)

    sorry for the stupid questions, but it is my chain of thoughts

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  4. #4
    Business licences are issued based on the address of your business. If you are working from home, that is your address. If you live in Vancouver and try for a business license in Toronto, you're talking one heck of a commute

    When you start talking about your primary revenue streams coming from overseas and local taxes, it gets very tricky and is worth paying an accountant to talk to about. In the Vancouver area I recommend Johnson, Archer & Assoc. They are top notch quality...and yes, you pay for it, a Digitally Justified Company
    Celebrating our 9th year in Business

    Proudly Hosting with CANADIAN bandwidth
    Managed Hosting, Multi-Domain Hosting, Colocation, Merchant Accounts
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  5. #5

    Just thought Id add something to this very informative post...

    Not sure what product/service you will be selling, but if its eligible for the various PST's it matters where your business is operating out of and where you have a presence..

    For example - if youre an Toronto based business selling a product online - you are required to charge Ontario PST + GST on every sale being shipped within Ontario and GST on every sale in Canada.

    So, If youre based in BC - and you are planning to sell product into Ontario - there is a huge benefit in maintaining your HQ in BC as you dont have to charge your Ontario customers PST - this obviously works in reverse as well. (believe it or not, its the consumers responsibility to report out of province purchases and pay those taxes - not the vendors responsibility to collect out of province taxes and forward to the appropriate government - strange but true - and Im certain theres a long list of consumers lining up at their provincial governments office to pay sales taxes on items they purchased out of province )

    Not sure if youre even targetting Canada at all based on your previous posts - but, thought it was worth mentioning...
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