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The Canadian Shopify Tax Exemption Guide

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eCommerce Strategy

Shopify is an excellent platform to start of a small-medium size eCommerce site. However, there are times when basic requirements need a tweak on the platform itself; but the developers at Shopify have done a great job to allow this workaround!

Canadian Shopify Tax Exemption

So, the question becomes: what if you have products that require HST to be exempted but, GST needs to be applied? For example books, female hygiene products or children’s clothing?

In Canada, Shopify can apply two taxes to an order, a Federal tax and a Provincial Tax. Which looks something like this…


Existing limitation, Shopify by default cannot exempt HST, however it can exempt PST. What we need to do its leverage this and trick Shopify in to thinking that HST and PST are the same. First, we alter the Tax rates a little so it applies the right tax on regular products. Then we create a new category to tell Shopify what product to exempt.

By following the following steps, you can have Shopify exempting HST and applying GST only or GST plus PST.

Exempting HST and Applying GST/PST: Step-by-Step

To start…

1. Label all HST as “HST | PST” and set “Added to 5% federal tax” for all provinces.


2. Create a collection called “tax:provincial:exemption” and assign products which require exemption to this category.


3. That’s pretty much it! Place an order to the province you want to test.


Example: physical books to Price Edward Island

Below is an example of a physical book going to shipping to Prince Edward Island, where HST is exempted, and GST is charged only.


Give this a try for other HST provinces, such as New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, Prince Edward Island or Quebec.

There you have it! Shopify will now exempt HST like a PST, and apply GST separately for certain products. This will certainly allow you to include products where this was a limitation before.

If you have any questions! Drop a comment!

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