Alberta Sales Tax: Your 2025 Guide to GST

Alberta has one of the simplest sales tax systems in Canada because it has no provincial sales tax (PST). However, some items and services are GST-exempt or zero-rated, which can be tricky. This Alberta tax guide 2025 will help you understand how sales tax works in the province.

Alberta Sales Tax System

Alberta sales tax is straightforward because it only collects GST, unlike the other provinces in Canada. It also has the lowest sales tax rate, appealing to businesses.

What is Alberta's GST?

In Alberta, consumers only pay the federal Goods and Services Tax (GST) at 5% on most goods and services. Yes, it only has one tax rate and it's federally administered by the Canada Revenue Agency (CRA).

There is no Alberta provincial sales tax (PST) or Alberta retail sales tax. Alberta is the only province in Canada without PST and harmonized sales tax (HST). This makes the system of sales tax in Alberta the simplest and its rate the lowest.

Alberta's lack of provincial sales tax (PST) makes its goods and services cheaper. Other provinces have 10% to 15% combined tax rates due to additional PST.

For businesses operating in Alberta, the lack of PST makes the process simple. They only need to collect and remit GST. They need not manage multiple tax rates, provincial filings or complex rules.

Alberta Sales Tax Key Features & Exemptions

Alberta's 5% GST applies to most goods and services, including retail products and restaurant meals. Professional services, digital products, commercial real estate, and new residential properties also charge GST.

However, some items and services are tax-exempt or zero-rated in Alberta. Check out the table below for more details about sales tax in Alberta:

Zero-Rated (Taxable at 0%)	Tax-Exempt (No GST Charged)
Basic groceries (milk, bread, meat, vegetables, etc.)	Residential rent
Prescription medications	Most healthcare services
Medical devices	Educational services (schools, colleges, etc.)
Exports	Financial services (bank fees, interest)

Calculate Alberta Sales Tax

As mentioned, the Alberta sales tax system is pretty straightforward. You can calculate taxes manually or use the Alberta sales tax calculator.

Step-by-Step Calculation for Alberta Sales Tax (GST)

For example, you are a business owner in Alberta and you are selling a $200 blanket. To calculate the 5% GST and total amount payable by the customer, follow the formula:

Step 1: Identify the sale price

Sale Price = $200.

Step 2: Calculate the GST Amount

GST Amount = Sale Price x 0.05

GST Amount = 200 * 0.05

GST Amount = 10

Step 3: Add the GST to the Sale Price

Total Price = Sale Price + GST Amount

Total Price = 200 + 10

Total Price = 210

If for example, you want to know the pre-tax price and GST amount, you can use the reverse calculation formula.

Pre-Tax Price = Total Price / 1.05

GST Amount = Total Price - Pre-Tax Price

Let's consider the example above for the blanket with a total price of $210.

Step 1: Get the pre-tax price

Pre-Tax Price = Total Price / 1.05

Pre-Tax Price = 210 / 1.05

Pre-Tax Price = 200

Step 2: Calculate the GST amount

GST Amount = Total Price - Pre-Tax Price

GST Amount = 210 - 200

GST Amount = 10

Using Online Sales Tax Calculators & Tools

If you do not want to engage yourself with manual calculation, no problem at all. You can search for "sales tax calculator Alberta" or check out Canada's GST/HST calculator.

For the Alberta sales tax calculator, you will be prompted to input the “Province or territory” and the “Amount before taxes.” For the province, choose Alberta and enter the pre-tax price or amount before taxes.

For the reverse sales tax calculator, you will be asked for “Province or territory” and “Total after taxes.” Choose Alberta for province and enter the Total Price for the “Total after taxes.”

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

Compliance Essentials for Alberta Businesses

Staying compliant with Alberta sales tax rules is essential for businesses operating in the province. Businesses must ensure they properly register, collect, report, and remit the 5% federal GST to the Canada Revenue Agency (CRA) to avoid penalties and stay in good standing.

Alberta Sales Tax Registration, Collection, & Remittance

For those who will be registering or filing for the first time, here are the things you should follow when managing sales tax in Alberta.

Step 1: Registration for GST

a) Determine if you need to register

• If your business earns more than $30,000 in annual taxable sales, you are required to register for a GST account with the Canada Revenue Agency (CRA).
• You may also voluntarily register, if you earn less, to claim Input Tax Credits (ITCs).

b) Apply for a Business Number (BN) and GST Account

• Register online through the CRA's Business Registration Online (BRO) portal.
• You can also register by phone (1-800-959-5525), by mail, or in person at a CRA office.

c) Receive your GST Account Number

• The GST Account number is used for all GST filings and communications with the CRA. It’s in this format: 123456789 RT 0001.

Step 2: Collection

a) Charge 5% GST on taxable sales. Add 5% GST to the sale price of all taxable goods and services in Alberta.

b) Include GST details on invoices

• Your invoices must clearly show:
• Sale price
• GST amount (5%)
• Total amount payable
• Your CRA-issued GST number

c) Maintain accurate records

Keep detailed records of all sales, GST collected, and GST paid on business expenses (for ITCs).

Step 3: Filing & Remittance

a) Determine your filing frequency (assigned by CRA)

• Annual: Revenue under $1.5 million.
• Quarterly: Revenue between $1.5 million and $6 million.
• Monthly: Revenue over $6 million.

b) File GST Returns

File your GST/HST returns with the CRA using:

• My Business Account (CRA online portal)
• By mail (using CRA forms)
• Through a tax professional, accountant or sales tax automation tool

c) Remit GST Payments

Pay the net GST owing to the CRA by the deadline (monthly, quarterly, or annually). Payment can be made online, at your bank, or by mail.

Common Mistakes & Tips to Avoid Them

Although Alberta sales tax is clear and simple, some business owners still commit mistakes. Here are the most common errors that you should watch out for.

1. Failing to Register on Time

Many businesses forget to register for a GST account with the CRA once they exceed the $30,000 annual revenue threshold. The $30,000 threshold refers to worldwide taxable supplies, including zero-rated supplies over four consecutive calendar quarters or in a single calendar quarter. Failing to do so can lead to penalties and interest on uncollected GST.

2. Incorrectly Charging GST on Exempt or Zero-Rated Items

Some businesses mistakenly charge 5% GST on items that are either zero-rated (0%), like basic groceries, or GST-exempt, like residential rent, financial services, or health care services.

3. Poor Record-Keeping and Filing Errors

Incomplete or inaccurate records of GST collected and Input Tax Credits (ITCs) can result in filing errors, audits, and penalties from the CRA.

Here are some tips to avoid the common mistakes above.

1. Track Your Revenue Regularly

Monitor your total taxable sales monthly to know when you cross the $30,000 small supplier threshold and need to register with the CRA.

2. Understand Taxable, Zero-Rated, and Exempt Items

Learn which goods and services are:

• Taxable (5% GST applies)
  • Zero-rated (0% GST applies but still reportable)
  • Exempt (No GST charged and not reportable)

3. Use Proper Invoicing

Always include the 5% GST separately on invoices and display your CRA GST number.

4. Keep Detailed and Organized Records

Maintain copies of all sales invoices, receipts, ITC claims, and filed GST returns. Keep records for at least six years as required by the CRA.

5. File and Remit GST On Time

Know your assigned filing frequency (monthly, quarterly, annually) and set reminders to file returns and pay GST on time to avoid penalties.

6. Consult CRA Resources or a Tax Professional

When in doubt, refer to the CRA website or consult an accountant or tax expert to ensure you follow the correct rules.

7. Leverage Sales Tax Automation Tools

Sales tax automation tools like Kintsugi make the whole process easy. Kintsugi simplifies sales tax management by automatically categorizing taxable and exempt items to accurately calculate taxes on every transaction.

Kintsugi also helps businesses stay compliant by automating tax filing, remittance, and securely storing records. With this, Kintsugi makes the entire process seamless and hassle-free.

Alberta Sales Tax FAQs

Does Alberta have sales tax?

Yes. Alberta charges 5% federal GST (Goods and Services Tax).

What is the sales tax in Alberta?

Alberta only collects GST at 5%.

How much is sales tax in Alberta?

The sales tax rate in Alberta is 5%.

Does Alberta have a provincial sales tax?

No, Alberta does not have a provincial sales tax (PST).

What is the provincial sales tax in Alberta?

Again, there is no provincial sales tax (PST) in Alberta.

Alberta Sales Tax Key Points

• No Provincial Sales Tax (PST): Alberta is the only Canadian province with no provincial sales tax.
• Simplified Compliance: Businesses in Alberta only need to register, collect, and remit GST to the Canada Revenue Agency (CRA) once they exceed the $30,000 annual revenue threshold.
• No HST, Only GST: Unlike other provinces, Alberta does not participate in the Harmonized Sales Tax (HST).

Next Steps & Essential Resources for Alberta Sales Tax

Here are more resources to help yourself familiarize with Alberta sales tax.

• Alberta Tax Information
• Government of Canada GST/HST for Businesses

If you want stress-free sales tax management in Alberta, leave it to Kintsugi because it's what we do best. Book a demo and partner with us.