Paying sales tax in New Brunswick is an inevitability when buying most products and services. As a consumer or a business owner, it’s important to understand exactly how sales tax works, both in New Brunswick and the rest of Canada.
Let’s find out more about the applicable sales tax in New Brunswick, and how it compares to other provinces and territories in Canada.
Sales Tax In New Brunswick
In New Brunswick, a 15% Harmonized Sales Tax (HST) applies to most purchases. HST includes both the federal Goods and Services Tax (GST) and the provincial sales tax (PST).
How Do You Calculate The Sales Tax In New Brunswick?
Calculating the HST on goods and services in New Brunswick is simple. Use the following formula to find out how to determine how much you’ll pay in HST when making a purchase:
Price of product or service + 15% HST
For example, let’s say you’re purchasing a product for $50. Based on the province’s 15% sales tax rate, the sales tax would come to $7.50, and the total cost would be $57.50.
The total tax and price you pay would be calculated as follows:
| Price Of Product or Service Before Tax | $50 |
| New Brunswick Sales Tax Rate | 15% HST |
| Total Sales Tax | $7.50 ($50 x 15%) |
| Price Of Product or Service After Tax | $57.50 |
What Goods And Services Are Expemt From Sale Tax In New Brunswick?
Not all goods and services are charged the 15% HST in New Brunswick. There are specific exemptions that apply. The majority of exemptions apply both to the federal 5% portion and the provincial 10% portion of the HST.
In New Brunswick, there are direct exemptions and zero-rated goods and services. They differ based on how businesses deal with the costs associated with the exemptions. Regardless, consumers are not required to pay HST on items from both categories.
Zero-Rated Goods And Services
- Basic groceries (except snacks, carbonated beverages, or liquor)
- Prescription medication (except over-the-counter medications)
- Medical devices
- Feminine hygiene products
Direct Exemptions
- Residential resales of real estate previously owned and used
- Rental units rented out for more than a month
- Education leading to a diploma or certificate, or training required for a specific practice
- Medical and dental services
- Financial services
- Childcare services
- Legal aid services
Registered First Nations offer rebates on both the federal and provincial portions of the HST for goods and services purchased and used on reserves.
Are You Charged NB Sales Tax If You Make An Online Purchase From A Store In Another Province?
If you buy something from a vendor located in a different province, it’s the responsibility of the merchant to figure out what type of sales tax to charge you. Buying a product online from a seller located in the same province is straightforward. You’d simply pay the sales tax that you would pay at a brick-and-mortar shop. If you live in New Brunswick, you’d pay 15% HST.
If the vendor is located elsewhere, you’d still pay the sales tax applicable in New Brunswick, as the vendor would have to charge the sales tax applicable in the province where the service is carried out or where the product ends up.
For example, let’s say you live in New Brunswick and you buy a toy online from a seller in Ontario. If you bought the toy in person in Ontario, you would be charged that province’s 13% HST. But since the product will be shipped to your home in New Brunswick, you would pay your home province’s 15% HST.
As a consumer, it’s not your job to determine which type of sales tax you’ll pay. Instead, the seller will determine what to charge you.
Do You Qualify For The GST/HST Tax Credit In NB?
The GST/HST tax credit is offered by the federal government and is designed to help reduce the amount of sales tax that consumers pay each tax year.
More specifically, the credit is meant to help low- to moderate-income Canadians. When you file your income taxes, you’ll automatically be considered for the GST/HST credit.
The credit includes four non-taxable payments made quarterly.
GST/HST Tax Credit Payment Dates In NB
The GST/HST credit is paid out on the following dates:
- January 5th
- April 5th
- July 5th
- October 5th
The GST/HST tax credit starts at $299, with an additional $157 credit if your household’s net income is over $9,686. After a net income of $38,892, the credit amount gradually decreases until it reaches zero.
Note: The deposit for your GST/HST tax credit payment may show up under the name “Canada FPT“.
Additional New Brunswick Tax Credits
Depending on your situation, you may qualify for other tax credits as a resident of New Brunswick, including the following:
New Brunswick Low-Income Tax Reduction
Low-income residents of New Brunswick may be eligible for the Low-Income Tax Reduction, a non-refundable tax credit that is meant to help reduce the amount of provincial tax owed. You must have been a resident of New Brunswick as of December 31, 2021, in order to qualify.
New Brunswick Seniors’ Home Renovation Tax Credit
New Brunswick seniors over the age of 65 years and their family members may be eligible for the Seniors’ Home Renovation Tax Credit, a refundable tax credit that is designed to reduce the cost of updating homes to make them more suitable for mobility needs.
Eligible Canadians can claim as much as $10,000 worth of home improvements when they file their taxes and receive 10% of the claimed expenses. For instance, if you spend $20,000 to update your home and claim that amount when you file your taxes, you could receive $2,000.
Sales Taxes And Businesses In New Brunswick
Businesses that operate in New Brunswick are required to determine how to tax their clients. They must also figure out how to claim their sales tax when filing for taxes.
Sales Tax Registration
Most businesses in New Brunswick are required to register for GST/HST. However, small businesses with sales under $30,000 over four consecutive calendar quarters are classified as small suppliers and may not be required to register. Business owners are encouraged to speak with a tax specialist to find out what their tax obligations are.
How To Tax Out-Of-Province Sales
The type and amount of sales tax that businesses in New Brunswick charge to out-of-province customers depend on where the product or service is supplied.
For instance, if you operate a brick-and-mortar business and a customer purchases something from you in person, you would charge the 15% HST that is applicable in New Brunswick. However, if you deliver your product or service to a customer in another province, you would charge the sales tax that is applicable where the client is. If the customer is in Ontario, for instance, you would charge that province’s 13% HST sales tax.
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Final Thoughts
It’s helpful to understand how sales tax works in New Brunswick, whether you’re a consumer or run a business. As a consumer, you’ll want to know what you’ll have to pay when you buy a product or service. And as a business owner, you’ll need to understand how to charge your customers.
