British Columbia Sales Tax: Your 2025 Guide to GST & PST

British Columbia applies a two-part sales tax system — GST and PST. Some business owners find sales tax in BC confusing and challenging. This BC tax guide 2025 will help you understand BC sales tax for seamless compliance.

British Columbia Sales Tax System

BC manages its own provincial taxes in addition to the federal taxes collected by the Canadian government. The province's two-part tax structure includes the following:

1. Goods and Services Tax (GST) - 5% federal tax applied across Canada. This is collected and administered by the Canada Revenue Agency (CRA).
2. Provincial Sales Tax (PST) - A 7% provincial sales tax is applied to most retail sales of goods and certain services in British Columbia. The BC Ministry of Finance administers this.

Unlike GST, PST is not recoverable in the BC sales tax system. Businesses cannot claim input tax credits (ITCs) for PST.

What is British Columbia's PST?

The provincial sales tax (PST) is a British Columbia retail sales tax applied at a rate of 7% to most goods and certain services purchased or used within the province. It is a consumption tax administered by the BC Ministry of Finance.

PST is not a value-added tax and businesses cannot claim ITCs on PST paid.

BC sales tax employed the harmonized sales tax (HST) in 2010, combining 5% federal GST and 7% provincial PST into a 12% HST. However, in 2011, voters agreed to repeal HST because it increased taxes on certain goods and services. In 2013, BC revoked HST and reinstated its separate GST and PST system.

How GST and PST Work Together for BC Sales Tax?

In British Columbia, PST and GST are not harmonized like in HST provinces. They are applied independently but often on the same transaction. Both are calculated separately on the pre-tax price.

GST is applied to most goods and services, including professional services, digital products, and goods sold in British Columbia.

PST is applied to most tangible personal property, software, telecommunication services, and short-term accommodations. Check this page to learn more about when to charge and collect PST.

Here's a table showing the taxable, zero-rated, and exempt items and when GST and PST apply.

Category	Examples	Tax Status (GST & PST)
Taxable Items (Both GST & PST)	Electronics, clothing, furniture, appliances, telecommunication services, short-term accommodation, digital products (e-books, streaming)	5% GST + 7% PST apply
Taxable Items (GST only)	Professional services (legal, accounting, consulting)	5% GST applies, PST exempt
Zero-Rated Supplies	Basic groceries (milk, bread, fruits), prescription drugs, certain medical devices, exports	0% GST, PST exempt
PST-Exempt but GST-Taxable	Printed books, children’s clothing and footwear, school supplies, agricultural equipment	7% PST exempt, 5% GST may apply
Fully Exempt Items	Residential rent, health care services, financial services, child care services	GST exempt or not applicable, PST exempt

Check this out to learn more about British Columbia PST Exemptions.

Calculate Sales Tax in BC

Calculating BC sales tax requires businesses to apply both the 5% federal GST and the 7% provincial PST correctly on taxable transactions. This section will teach you how to calculate British Columbia sales tax accurately.

Step-by-Step Calculation for GST and PST

For example, you are selling a jacket in British Columbia for $150. In B.C.

Step 1: Calculate the GST amount

Amount before taxes = $150

GST Rate = 5%

GST = Amount before taxes x GST Rate

GST =$150 x 0.05

GST = $7.50

Step 2: Calculate the PST amount (7%)

PST Rate = 7%

PST = Amount before taxes x PST Rate

PST = $150 x 0.07

PST = $10.50

Step 3: Add PST and GST to Amount Before Taxes

Total after taxes = Amount before taxes + GST + PST

Total after taxes = $150 + $7.50 + $10.50

Total after taxes = $168.00

Using Online BC Sales Tax Calculators & Tools

If you want to skip the hassle of calculating BC sales tax, you can actually do that. You can search for "BC sales tax calculator" or "sales tax calculator BC." But I suggest you use the Government of Canada's GST/HST calculator.

To get the total after taxes amount, just choose British Columbia in the drop-down list for "Province or territory." Then, enter 150 "Amount before taxes" based on our example above. The sales tax calculator Manitoba will show you the amounts of GST, PST, and total after taxes.

If you want to find the amount before sales tax is applied, use the reverse sales tax calculator BC. Just choose British Columbia for "Province or territory" and input the total after taxes amount. In our example, it is $168. The calculator will give you the GST, PST, and before taxes amounts.

Sales tax automation tools, like Kintsugi, come with their own BC sales tax calculator. Kintsugi accurately calculates sales tax by applying the correct tax rates. With Kintsugi, you do not need to worry about sales tax calculations, and if you do it right, because it's Kintsugi's expertise.

Compliance Essentials for Businesses Managing BC Sales Tax

Staying compliant with British Columbia GST/PST sales tax rules is crucial for businesses operating in the province. The BC sales tax system – GST (5%) and PST (7%) – doubles the trouble. This section will guide you through the essential steps to properly register, collect, file, and remit BC sales taxes.

BC Sales Tax Registration, Collection, & Remittance

Here's an overview of the steps to follow when managing sales tax in BC.

1. Registration

In BC, businesses need to register for two separate tax accounts:

a) GST Registration (Federal)

• Register with the Canada Revenue Agency (CRA)
• Required if your business earns over $30,000 in annual taxable sales
• You will receive a GST account number as part of your Business Number (BN)

b) PST Registration (Provincial)

• Register with the BC Ministry of Finance
• Required if you sell or lease taxable goods, provide taxable services, or software in BC
• You will receive a PST account number

2. Collection

Once registered:

• Charge 5% GST on most goods and services
• Charge 7% PST on taxable goods and some services

PST and GST must be clearly shown on invoices and receipts. Some items may be PST-exempt or zero-rated for GST, so it's important to categorize items correctly.

3. Remittance & Filing

GST (Federal):

• File GST returns with the CRA (monthly, quarterly, or annually based on revenue)
• Remit the GST you collected minus any Input Tax Credits (ITCs)

PST (Provincial):

• File PST returns with the BC Ministry of Finance
• Filing frequency depends on business revenue
• Remit the full amount of PST collected (there is no input tax credit system for PST)

BC Sales Tax Quick Tips For Avoiding Common Pitfalls

Navigating sales tax in British Columbia can be tricky, especially with separate GST and PST rules. This section offers quick, practical tips to help you avoid common mistakes. Apply them to stay compliant with provincial and federal tax requirements.

1. Know What's Taxable and Exempt

Review and understand which goods and services in BC are subject to PST and GST and which are exempt or zero-rated. Always apply the correct tax to avoid overcharging or undercharging customers.

2. Maintain Complete & Accurate Records

Keep detailed records of the following and retain them for at least 6 years:

• Sales transactions
• GST and PST collected
• Exemption certificates (if applicable)
• Tax returns and remittance payments

3. Train Staff on Tax Rules

Ensure employees involved in sales, billing, or accounting understand PST and GST rules. Provide regular training and updates when BC sales tax policies change.

4. Regularly Review Tax Settings

Check your POS system, accounting software, and online store settings to make sure the 5% GST and 7% PST are applied correctly. Stay up to date with sales tax rate in BC and new exemptions.

5. Automate Tax Compliance with Kintsugi

Automation reduces manual errors and significantly lowers your audit risk. Use a trusted sales tax automation tool like Kintsugi to do the following:

• Automatically categorize taxable and exempt items
• Accurately calculate GST and PST
• Automate tax filing and remittance
• Maintain organized, audit-ready tax records

BC Sales Tax FAQs

What is BC Sales Tax Credit?

The BC Sales Tax Credit is a provincial tax benefit designed to help low-income individuals and families offset the cost of the 7% Provincial Sales Tax (PST). Eligible residents can receive a tax-free payment from the BC government.

How much is sales tax in BC?

The total sales tax in BC is 12%, made up of 5% federal GST and 7% provincial PST.

What is PST exempt in BC?

Some common PST-exempt items in BC include basic groceries, children's clothing and footwear, books, most health-related goods and services, and residential energy (like electricity and natural gas).

BC Sales Tax Key Points

• BC sales tax is a dual system -- 5% federal GST and 7% provincial sales tax (PST), for a combined rate of 12%.
• GST is administered by the Canada Revenue Agency (CRA), so registration, collection, filing and remittance must be done through CRA.
• PST is administered separately by the BC Ministry of Finance, so businesses must register, collect, file, and remit PST through the province
• PST generally applies to tangible personal property, software, short-term accommodation, legal services, and telecommunication services. GST has broader coverage, including more services.
• Some items and sectors are PST-exempt (e.g., basic groceries, certain medical devices, child care), and businesses may qualify for exemptions or refunds on PST for resale goods, manufacturing equipment, or interjurisdictional sales.

Next Steps & Essential Resources for BC Sales Tax

If you wish to learn more about BC sales tax, you can visit the following sites and resources:

• BC Ministry of Finance
• Canada Revenue Agency (CRA)
• Small Business Guide to PST

Do not leave your British Columbia tax compliance to chance. Let Kintsugi manage it so you can focus on the growth of your business. Book a demo or sign up today to experience the power of Kintsugi.