GST/HST and QST on CRM subscriptions: what Canadian small businesses pay and recover

A CRM subscription bought by a Canadian business is generally subject to GST or HST, plus QST if you are in Quebec, and in some western provinces a provincial sales tax can apply to software too. If your business is registered for GST/HST (and QST), the federal and Quebec taxes are usually recoverable as input tax credits and input tax refunds, so they affect cash flow more than final cost. The costly exception is a foreign vendor registered only under the simplified GST/HST framework: if you do not give it your registration number, it may charge tax that you generally cannot claim back. Provincial sales taxes in British Columbia, Saskatchewan and Manitoba are usually a real cost.

This guide is general information as of October 2026, not tax advice. It is part of the CRM cost overview.

Which tax appears on your CRM invoice

Rates can change; confirm the current rate on the CRA's GST/HST rates page and the provincial finance ministry's site before you rely on this table. Which province's rate applies to a subscription is set by place-of-supply rules, which for business customers generally look at the customer's address. If you have staff in several provinces, ask the vendor which address it uses.

Foreign CRM vendors and the simplified framework

Many CRM and sales tools are sold by companies outside Canada. Since 1 July 2021, non-resident vendors of digital services that sell enough to Canadian consumers must register and collect GST/HST, many of them under a simplified registration. That system is designed for consumer sales. According to the CRA, tax charged by a simplified-framework registrant generally cannot be claimed as an input tax credit; the CRA's GST/HST Notice 322 explains the recovery rules and advises business buyers to give such vendors proof of their GST/HST registration so the tax is not charged.

Quebec has a parallel specified registration system for out-of-province and foreign suppliers of digital services. A QST-registered business should give the vendor its QST number too.

What to do at signup:

1. Look for a "tax ID" or "business tax number" field in the vendor's billing settings and enter your GST/HST number, and your QST number in Quebec.
2. Check the first invoice: does it show the vendor's registration number and the right province's rate?
3. If the vendor charged tax after you gave your number, ask for a refund or credit in writing.
4. If a foreign vendor is not registered at all, ask your accountant whether self-assessment could apply. For a business that uses the service only in its taxable commercial activities, self-assessment generally does not apply, but businesses making exempt supplies, such as some financial or health services, should check.

Worked example (illustrative)

A Toronto consulting firm registered for GST/HST pays a CRM bill of $6,000 a year before tax.

• Vendor registered under the normal regime, firm's address in Ontario. The invoice shows 13% HST: $780. The firm claims $780 as an input tax credit. Net cost: $6,000.
• Foreign vendor under the simplified framework, no registration number given. The vendor charges $780 HST. That tax is generally not claimable as an ITC, so the net cost becomes $6,780. Over three years: $2,340 of avoidable tax unless the vendor refunds it.

A similar firm in Vancouver paying $6,000 would see 5% GST ($300, recoverable) and could also owe BC PST at 7% on software ($420), which is not recoverable. Over three years the PST alone is $1,260, a real cost that belongs in the 3-year cost estimate.

Add-ons and services

Tax applies to more than the subscription:

• Onboarding, setup and training by the vendor or a Canadian partner are usually taxable services.
• Calling and SMS credits may be taxed as telecommunication services.
• Marketing-contact tiers and add-ons are part of the same taxable supply.
• Hardware such as headsets or card readers bought with the CRM follows the normal rules for goods.

A partner implementation invoice from a registered Canadian firm carries GST/HST or GST plus QST, generally recoverable for registered businesses.

Small suppliers that are not registered

If your business is a small supplier and not registered for GST/HST (in general, taxable revenues of $30,000 or less over four consecutive calendar quarters), you cannot claim input tax credits, so sales tax on your CRM is a full cost. Include it in your comparison. If you are close to the threshold, ask your accountant whether voluntary registration makes sense.

Invoice details to keep

For input tax credit claims the CRA requires more invoice information as the purchase amount grows: from $100 the supplier's name and GST/HST registration number among other details, and from $500 additional items such as your business name and terms of payment. Store the vendor's registration number on its supplier record and download invoices monthly; some vendors keep only a limited history in the billing portal.

FAQ

Is a CRM subscription zero-rated if the vendor is in the US?

No. Where the vendor is located does not by itself make the supply zero-rated; what matters is its registration status in Canada and the place-of-supply rules.

Do I pay QST if my business is in Ontario but some staff are in Quebec?

It depends on the address the vendor uses for place of supply. Ask the vendor and your accountant if you have significant operations in Quebec.

Can I recover BC PST on software?

Generally no; PST is a cost to the business. Check the BC government's PST guidance for exemptions that might apply.

Who administers GST/HST for Quebec businesses?

Revenu Québec generally administers both GST/HST and QST for businesses located in Quebec.

Sources

• Canada Revenue Agency — GST/HST rates, Notice 322, input tax credit requirements, small-supplier rules
• Revenu Québec — QST and the specified registration system
• Government of British Columbia — PST on software and software as a service
• Justice Laws Website — the Excise Tax Act