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5Hi,
I am located in Ontario, Canada, and we will be moving to a Harmonized Sales Tax system tomorrow (July 1, 2010).
Until now, there have been 2 separate sales taxes in Ontario - one federal (5%) and one provincial (8%). Whenever we sold out-of-province, we would only apply the federal tax, so it was just a matter of unclicking the option for the provincial tax on the sale.
Now, with the new harmonized system, there will be one harmonized tax in Ontario at a rate of 13% (some items will only have the 5% federal part of the tax levied, but that's another story which does not affect what I'm asking). Other provinces in Canada have different cases - some are still charging federal tax and provincial tax separately, others might be harmonized at the same rate as we will be here in Ontario, and others still will be harmonized at different rates altogether.
For selling to provinces which are charging separate taxes or are harmonized at the same rate, the solution seems fairly straightforward. I can keep the sales taxes on my system at 5% and 8%, because (to the best of my knowledge) it does not matter if the taxes are broken down on the receipt. So any province which is harmonized at 13% gets treated the same as Ontario, and for any province who levies federal taxes and provincial taxes separately, I can just turn off the 8% provincial tax.
My issue is in the case of selling to provinces where they are harmonized at other rates. For example, customers in British Columbia should be charged at (5% federal + 7% provincial =) 12%. How do I apply a 7% tax without applying it ALL the time?
Thanks in advance for your help!
Chuck Elnekave
The Israeli Source
Thornhill, ON
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