A February 15 GST/HST Checklist for Canadian Shopify Stores
Canada's temporary GST/HST break runs from December 14, 2024 to February 15, 2025. Shopify zero-rates eligible products automatically for most stores, but the end date still needs attention, and so do customers who think they were charged in error.
Published Jan 8, 2025. Author: Ecomm Guys. 4 min read.
Key Points
- The break zero-rates GST/HST on items such as children's clothing and toys, books, jigsaw puzzles, and video game consoles from December 14 to February 15.
- For shipped orders, an item counts as delivered when you hand it to the carrier or courier.
- Shopify applies the zero-rating automatically when products are in the right categories and you use registration-based taxes.
- Stores that enter tax rates manually don't get the automatic treatment.
- On February 16, check that tax is charged again and that no manual overrides are left behind.
What the Break Covers
The Tax Break for All Canadians Act received Royal Assent on December 12, 2024. It amends the Excise Tax Act to zero-rate certain items from December 14, 2024 to February 15, 2025, inclusive. During that time, no GST or HST is charged on qualifying items.
The Canada Revenue Agency's list includes children's clothing and footwear, children's diapers and car seats, and children's toys. It also covers jigsaw puzzles, video game consoles, controllers and physical games, printed books, printed newspapers, Christmas and similar decorative trees, and many food and drink items. The legislation sets out detailed definitions, so check the CRA guidance for each product type you sell rather than assuming.
The Timing Rules for Online Orders
An item qualifies only if it's paid for in full during the period and delivered or made available to the buyer during the period. There's an exception for deposits paid before December 14, as long as the rest is paid and the item is delivered within the period.
Most online orders are shipped, and the law has a special rule for that. If you use a common carrier or send an item by mail or courier, the item is treated as delivered when you hand it to the carrier. So an order paid on February 15 and handed to the courier that day qualifies, even if it arrives later. An order paid on February 15 that ships on February 17 does not.
How Shopify Handles It
Shopify announced that from December 14 it automatically applies zero-rating to eligible products that are assigned to the right product categories, with no manual tax adjustments needed. Two conditions matter. First, your products must be in a category on Shopify's eligible list, with no manual tax overrides on them. Second, your store must use registration-based taxes. If you enter tax rates yourself in Taxes and Duties settings, the zero-rating isn't applied automatically.
Shopify suggests using the bulk editor to review product categories quickly.
What to Check on February 16
Shopify hasn't said exactly how the change back will look in each store, so plan a short review the day after the break ends.
- Place a test order for one item from each eligible category and confirm GST/HST is charged.
- Remove any temporary tax overrides your team added during the break.
- Look at orders paid on February 15 that shipped later, and confirm how they were taxed.
- Update any banners, product badges, or emails that mention tax-free pricing.
- Make sure your accountant has a clear export of zero-rated sales for the period.
Handling Refund Requests
The CRA tells shoppers who think they were charged GST/HST in error on a qualifying item to gather their receipts and ask the seller for a refund. If the seller doesn't refund it, the shopper can apply to the CRA for a rebate, with a $2 minimum and a two-year time limit.
Expect some of these requests, especially if a product was in the wrong category for part of the period. Decide now who on your team handles them, how you'll check eligibility, and how to record the refund of tax so your filing stays accurate.
Before February 16
This week, export your product list and check that every eligible item has the right category. Confirm your store uses registration-based taxes. Then put a reminder in the calendar for February 16 to run the checklist above.
If you'd like a hand reviewing product categories or tax settings, book a call with our team.
Sources
- GST/HST break Government of Canada, December 2024
- Handle the Canadian Tax Holiday Automatically with Shopify Shopify Changelog, December 2024
- Tax Break for All Canadians Act (S.C. 2024, c. 32) Justice Laws Website, December 2024