Why is store charging PST on Canada Post shipping for orders to BC (from outside BC)???

chcsep
Excursionist
30 1 11

Can anyone help me get my store to not charge PST on shipping for orders destined for BC?

We are not in BC, and we are not registered to collect or remit provincial tax in BC. We are located in Ottawa and do not have to collect PST in BC.

I have configured my tax settings to reflect this, and it is working for the product. I also have an exemption for shipping to add 0% to shipping for orders in BC.

However, when I create an order going to BC, the shipping on Canada Post is charged 5% GST and 7% PST! This does not happen when I select UPS shipping.

No combination of settings can get this to go away. Is there something messed up with Shopify's Canada Post integration?

This amount doesn't seem to be included in the amount that gets tacked onto my account in shipping fees, so it's not like it's being passed along to Canada Post (which it shouldn't). Yet if we're telling our customers that we're collecting it, we'll be on the hook for remitting it.

Before I get told to restart my computer, here are my tax settings for Canada:

Country Tax: 5
Regions: British Columbia*: [0] [PST] [added to 5% federal tax]
(*I get the same result with [5] [GST] [instead of 5% federal tax])

Override: Shipping: Canada: 5% instead of 5% federal tax
(*with or without a shipping override I get the same result)

I also have an override on the product to charge 5% in provinces with HST for some of our products that are exempt of the provincial portion of HST; this works properly but doesn't apply to BC.


 

 

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Matthew27
New Member
2 0 1

I have been arguying with Shopify for months on this. We are in Quebec and Shopify is forcing a tax collection on PST (only for Canada Post selected shipments) for each other province who collects PST but we are not registered and don't qualify to be registered.

Other than leaving Shopify, what can be done?

The overides don't seem to work...

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chcsep
Excursionist
30 1 11

tl;dr: no fix.

Back in June, I corresponded with both Canada Post and Shopify, who kept punting me back and forth. Eventually I was able to connect with a Shopify Guru who acknowledged the issue.

She said (ticket #9307055 for any gurus watching):

I apologize in advance that we do not have an immediate solution for you. I have confirmed with the technical team that it is the way the Canada Post integration is written, to charge taxes in the region/province the label was purchased.

To change this, would require an update of the API integration with Canada Post. We do take our merchants needs into the upmost consideration, and I will be submitting this as feedback for our team who actively works with our Shipping partners to hopefully get an improvement on this in the future.

We also have an issue where the Canada Post integration was not charging our contract rates (contrary to what was indicated in the Shopify/Canada Post documentation) but the slightly higher Shopify Advanced rates. It also was charging this directly via Shopify instead of through our contract (meaning that purchases we make via Shopify would not contribute toward our contract volume and therefore we could risk losing our contract rates for non-sales shipments we make with Canada Post).

As a workaorund, we did the following:

  • We reverted to our previous shipping pricing (which is based on product price, not on actual shipping cost, and we continue to lose money on shipping for orders on the far end of the country)
  • We reverted to creating shipments via the Canada Post website (manually entering the data, which is much more time consuming than the one-click Shopify integration. This was one of the big selling points that brought us to Shopify!)
  • We then have to copy the tracking numbers back from Canada Post into our orders so that our customers can track them via their customer account on our Shopify store.

We could perhaps have survived with the non-contract rates, but the PST thing is definitely a killer.

I have not received any follow-up since early June.

Matthew27
New Member
2 0 1

Wow..sounds like a similar operation.

My take on the tax issue is that Shopify has it setup as if they were the ones paying and charging for taxes. Since they are a major company who is setup in every process and (wrongly) assumes that everyone will use their Post rates and shipping they assume the fees (incorrectly nevertheless) and so on.

I have been in touch with a Shopify guru up the chain as well who acknowledges but probably does not fully understand the issue and implications.

For a company like Shopify this whole issue is mind boggling to me!

I just fear that we are going to get into trouble soon with the tax man for these small PST amounts as we are only registered in our home province (Quebec) and not Mb or BC where they all charge PST.

Regarding contract rates we use calculated rates (our contract rates) for Post, UPS, FedEx and even DHL (through an outside app). It seems that the Canada Post rates were recently adjusted to consider large shipments whereas some of our customers were getting and selecting quotes based on the canada post max weight (about 65lbs). Essentially a shipment with a 200lbs rating would previously be calculated and quoted at 65lbs. today it seems that they have figured out how to cut that into different boxes (shipments) and add it all up....I hope this makes sense.

I really want to switch my other stores and over to Shopify but these tax issues are making me very uneasy and pushing me to move away from Shopify. Keep me posted if you find or see a fix please.

NotaRobot
Shopify Partner
2 0 0

I too made this complaint last year, and met with the typical back - forth Canada Post - Shopify (lying obfuscation) blaming each other. It is a total bunch of crap. To prove it to yourself, simply go to your own Canada Post business mailing account and make your label from there. Notice that only GST is being charged on the Canada Post charges. It is pretty clear to me that this practice is somewhat illegal, since in effect, MY business is charging the customers taxes which are not due. What if I didn't have a GST registration, and just charged all of my customers a made up 5% charge I labelled GST on my invoice. Obviously, I have no way to remit that tax to the government it is due to. How long would it be before I was in jail for fraud?

 

The same is true in this matter. I only have an Ontario tax registration, and only can remit taxes under the Harmonized GST-PST requirements. Charging taxes on the Canada Post fees for provinces that I am not registered to is fraudulent. Shopify needs to clarify who is remitting this tax money? Shopify itself to Canada Post is most likely; however then, how can Shopify charge tax to an Ontario business that is not required to remit singular provincial taxes?

 

It remains that Shopify is the only business entity doing this. None of our other shippers do this, and Canada Post does not do this when I ship using the Canada Post account my business has directly. Clearly Shopify needs to respond, rather than treating it like their crazy spamming issues that have been ignored since the very beginning of the platform.

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Anindo
Shopify Partner
553 1 20

This can be taken care in Shopify with the Multi Carrier Shipping label app. With this app, your Canada Post account will fetch shipping rates at checkout with or without taxes depending upon the origin and destination details sent to the API. In your case, if you are not registered to collect provincial tax in BC, the app should not show this to your customer.

Product Owner @ PluginHive
Shipping Automation | FedEx shipping | Multi-carrier shipping | Shipment Tracking | Australia Post shipping
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NotaRobot
Shopify Partner
2 0 0

To anyone who has yet to resolve this issue, and all support staff:

After complaining about this issue over three years ago, and receiving several unhelpful responses from Shopify and Canada Post, I had resolved myself to Shopify collecting unremitted tax on my behalf.  As we do very little B to C business, I just blamed Shopify and continued to process and not concern myself with it. The amount of money is quite small as we do very little B to C business. Buying an app to fix it didn't make any sense as a solution because, to me, Shopify created the problem with a programming change they were blaming on Canada Post. Canada Post in turn blamed Shopify.

The problem first arose for me when Shopify suddenly began charging PST on shipping. Prior to that time it did not. Well, today, while setting up another store, I tweaked to something really basic. When I looked at the current tax settings for the store I noticed that the field for my TAX id number in the SETTINGS/TAX page it was blank. After filling in the Business Number the tax collection for my sales is now functioning correctly. This was the only change that I made.

We set up this account too long ago for me to remember, but I am sure that we had setup properly for Canadian tax collection as the GST was always remitted by Shopify to us. I am assuming that this field was added at a later time in a programming update years after our initial setup. Not having anything in that field screwed up the PST setting on shipping charges. An unintended consequence, however, I am happy to provide this to Support so they can deal with any other complaints on this issue. I am assuming that this issue only arises for longer term Shopify tenants.

Kind regards,

Mike Boylan

 

 

 

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