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If I have a US-based business, am I exempt from paying Canadian GST on purchases of advertising from Canadian media outlets?

Full Question: I run an advertising agency that buys advertising space from media outlets (magazines, websites, etc.) in the US and Canada. My client is Canadian-based (Vancouver, BC). I buy and pay for all advertising on my client's behalf and am then reimbursed. I buy a lot of advertising from Canadian media outlets, and am always charged some sort of Canadian tax (GST, HST, or TPS and TVO from Ontario-based companies) by these media outlets. Because I am a US-based business, am I exempt from paying these taxes? I understand that Canadian-based companies are supposed to charge these taxes, but for advertising space contracts signed between a Canadian and US company, is this still the case?

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Answer:

Diane Yetter photoIf the advertising is for advertising in Canadian media outlets, this is usually subject to GST/HST because the service is being performed in Canada - even though the purchaser is located in the US. If however, the advertising is in US or other non Canada media outlets, then the tax likely should not apply. If you need further assistance with this matter, please feel free to contact us directly.

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