Provincial Tax
BC PST Explained for Small Business
BC PST explained for small business: who must register, what's taxable, and how to collect and remit provincial sales tax in British Columbia today.
BC PST (provincial sales tax) is a retail sales tax the Government of British Columbia applies to most taxable goods and certain services sold in the province, and businesses collect it on the province's behalf. If you run a sole proprietorship in BC and sell taxable items, you may need PST registration so you can charge, collect and remit the tax correctly. This guide explains how BC PST works today and what it means for a small business.
What is BC PST?
Provincial sales tax is separate from GST. In BC, PST generally applies to the retail sale, lease or rental of taxable goods, and to certain taxable services, software and accommodation. The seller collects PST from the buyer and remits it to the BC Ministry of Finance. The province sets the rates and the list of taxable and exempt items, so confirm the current rate and category rules on the BC government's tax pages rather than relying on older figures. GST, by contrast, is federal and administered by the CRA, which is why a single BC invoice can show two separate taxes.
Do you need to register for PST?
Registration depends on what you sell and where you operate. As a general rule you should register once you make taxable sales in BC, although the province has specific rules for small sellers and for sellers with no fixed place of business in the province. Consider registration if you:
- sell tangible goods at retail in BC, including online orders shipped to BC customers;
- lease or rent taxable goods to customers in the province;
- provide taxable services, such as certain accommodation or telecommunication services;
- sell taxable software or digital goods to BC buyers.
Some sellers with low BC revenue and no BC location may not need to register. Confirm your situation with the province before you start charging tax. For how provincial and federal obligations land on the owner, see BC sole proprietorship tax.
PST registration: how it works
You register for PST with the BC Ministry of Finance, typically through its online tax services. You will need your business details, your Business Number (BN) and, as a sole proprietor, your SIN. Once registered you receive a PST number, which you show on invoices and give to suppliers so they apply the right treatment on your purchases. If you have not dealt with registration yet, start with whether you need to register a sole proprietorship. PST registration does not cover GST/HST, payroll or income tax; those are separate programs administered by the CRA.
What is taxable and what is not
PST applies differently depending on the item, and the province maintains the authoritative lists. The overview below is simplified — always check the current BC tax list for your specific product or service.
| Category | Typical PST treatment |
|---|---|
| Most new and used tangible goods sold at retail | Taxable |
| Basic groceries | Generally exempt |
| Prescription drugs | Generally exempt |
| Children's clothing and footwear | Generally exempt, with conditions |
| Certain services, such as some accommodation | Often taxable — check the list |
| Professional services (legal, accounting, consulting) | Typically not subject to PST |
Collecting, remitting and record keeping
Once registered, you charge PST on taxable sales, show the tax separately on your invoices, and hold it in trust until you remit it. Remittance is periodic — monthly, quarterly or annual depending on your sales volume and the province's rules — so confirm your reporting frequency in your BC tax account. Keep records of:
- sales invoices showing PST charged, or documentation for exempt sales;
- purchase invoices, including PST paid on goods you resell or use;
- returns filed and remittances made, with confirmation numbers.
Clean records make audits and corrections far easier. If you take on staff, PST sits alongside payroll obligations; see employees in a sole proprietorship.
PST versus GST/HST
BC has PST plus the federal GST, not HST. A taxable BC invoice therefore typically shows two taxes: GST, which you remit to the CRA, and PST, which you remit to the province. You may need separate GST and PST registrations. If you are under the CRA's small-supplier threshold you might not have to register for GST/HST, but PST has its own provincial rules — one registration does not cover the other. Provinces that use HST blend the two taxes and administer them through the CRA. Compare approaches in Saskatchewan PST and Manitoba RST.
Common mistakes and penalties
Typical errors include failing to register when required, charging PST on exempt items, remitting late, and overlooking PST on sales to BC buyers from outside the province. The province can assess unpaid tax plus interest and penalties, so correct mistakes as soon as you find them, and file any missed returns even if you cannot pay immediately. If you are unsure whether your product is taxable, ask for the province's position in writing before you start charging. Treating PST as part of your own revenue is another frequent slip — the tax is collected on behalf of the province and is never yours to spend.
Frequently asked questions
Do I need to register for BC PST as a sole proprietor?
It depends on what you sell. If you make taxable retail sales of goods in BC, lease taxable goods, or provide taxable services, you generally need to register with the BC Ministry of Finance. Sole proprietors use their SIN and Business Number during registration. Some small sellers and out-of-province sellers fall outside the requirement, so confirm your situation with the province before you start charging tax.
What is the difference between BC PST and GST?
BC PST is a provincial retail sales tax collected by the BC Ministry of Finance, while GST is a federal tax administered by the CRA. BC does not participate in HST, so both taxes can appear on the same taxable invoice. You remit them separately, to different governments, and each has its own registration rules and reporting periods.
What items are exempt from BC PST?
Exemptions generally include basic groceries, prescription drugs, and children's clothing and footwear, with conditions attached. Most new and used tangible goods sold at retail are taxable, and many professional services are outside PST entirely. Because the province maintains and updates these lists, check the current BC tax information for your specific product or service before deciding what to charge.
How often do I remit BC PST?
Reporting frequency is assigned by the province and is usually based on the amount of tax you collect, with monthly, quarterly or annual filing periods. Your assigned frequency appears in your BC tax account. Returns and payment are generally due shortly after the end of each reporting period, so confirm your exact dates in your account or with the BC Ministry of Finance.