Answers to the most common questions about invoicing, GST/HST/QST, business numbers, and getting paid as a freelancer or contractor in Canada.
GST (Goods and Services Tax) is a federal tax of 5% that applies across Canada.
HST (Harmonized Sales Tax) combines the federal GST with a provincial sales tax into a single rate. Provinces using HST:
In provinces without HST, you charge GST (5%) alone, or GST + a separate provincial tax (PST or QST).
You must register when your total taxable revenues exceed $30,000 in a single calendar quarter or over four consecutive quarters. Until then, you're a “small supplier” and registration is optional.
Once registered, you must charge and remit GST/HST on all taxable services.
The threshold is $30,000 CAD in total taxable revenues over four consecutive calendar quarters. Once you exceed $30,000 in any rolling 12-month period, you must register within 29 days.
QST (Quebec Sales Tax) is Quebec's provincial sales tax at 9.975%, charged in addition to the federal GST (5%) for a combined rate of 14.975% in Quebec.
If you supply taxable services in Quebec and exceed the $30,000 threshold, you must register for QST with Revenu Québec (separate from your CRA GST registration).
GST and QST are calculated separately on the subtotal — QST is not charged on top of GST.
Folyo calculates this automatically when you select QST as your tax type.
Yes, if you're registered for GST/HST. ITCs let you recover the GST/HST you paid on business expenses — tools, software, materials, subcontractors, etc. You claim them on your GST/HST return to offset the tax you collected. Keep all supplier invoices for at least 6 years.
PST rules vary by province:
Unlike GST/HST, PST has no single federal threshold — registration requirements depend on the province and what you sell. Check with your provincial tax authority if you're unsure whether your services are taxable.
Requirements scale with invoice size:
Best practice regardless of amount: business name, client name, invoice number, date, description of services, subtotal, tax, and total.
Yes, if you're registered. Your registration number (9-digit BN + RT0001, e.g. 123456789 RT0001) must appear on any invoice where you charge GST/HST. Clients need your number to claim their own input tax credits. If you're under the $30,000 threshold and not registered, you don't charge GST/HST and don't need a number.
The CRA requires keeping all business records — including invoices — for at least 6 years from the end of the last tax year they relate to. Revenu Québec has the same 6-year requirement.
Yes. There's no restriction on invoicing in foreign currencies. For GST/HST purposes, convert the amount to CAD using the Bank of Canada exchange rate on the invoice date. Services performed entirely for non-resident clients outside Canada are generally zero-rated (0% GST/HST).
An invoice is a request for payment — sent before the client pays, showing what's owed and when. A receipt is proof of payment — issued after the client pays. Many invoices are marked PAID and serve as both. Keep both for at least 6 years.
A quote (also called an estimate) is sent before work begins — it outlines the scope, price, and terms for your client to approve. An invoice is a request for payment, sent after work is completed or at agreed milestones.
In Folyo, once a client accepts your quote online, you can convert it to an invoice in one click.
A Business Number is a 9-digit identifier assigned by the CRA to identify your business. It's the root number for all your CRA accounts — GST/HST (BN + RT0001), payroll (BN + RP0001), corporate income tax (BN + RC0001). You get one when you register for GST/HST or incorporate.
No. As a sole proprietor under the $30,000 GST/HST threshold, you can invoice using your own name or a business name without a BN. You only need one once you register for GST/HST (when you exceed $30,000 in taxable revenues).
NEQ stands for Numéro d'entreprise du Québec (Quebec Enterprise Number) — a 10-digit identifier assigned by the Registraire des entreprises du Québec (REQ). Sole proprietors operating under their own name don't need one, but those operating under a trade name in Quebec must register and receive an NEQ.
An RBQ number is a licence issued by the Régie du bâtiment du Québec — required for contractors and subcontractors doing construction, renovation, or electrical work in Quebec. Working without one can result in significant fines. Your RBQ number is typically included on invoices and contracts.
No. As a self-employed sole proprietor, you can legally send invoices under your own name and report income on your personal T1 return (T2125 form). No formal business registration required unless you operate under a trade name — in which case you may need provincial name registration.
Yes. Folyo is built for Canadian freelancers and contractors, but it works for anyone. Use the custom tax field to enter your tax name (e.g. “Sales Tax”, “VAT”) and rate — Folyo applies it automatically to all your invoices.
Configure your custom tax in Settings → Preferences. It's available on every plan, no upgrade required.
Select PST + GST as your tax type in Settings, then choose your province (BC, Manitoba, or Saskatchewan). Folyo applies the correct combined rate and shows both taxes as separate line items on your invoices.
If you need a different rate or label — say, a custom provincial tax — you can also use the custom tax field to enter any name and rate.
Folyo has three plans:
All plans support GST, HST, QST, PST, and custom tax types.
Yes. The free plan is $0 forever — no credit card required, no trial period. It includes 3 invoices per month, unlimited clients, unlimited quotes, PDF invoices, and full Canadian tax support (GST, HST, QST, PST, custom).
Upgrade to Solo or Pro when you need more volume or features like card payments and contracts.
Common options:
Interac e-Transfer is the most popular for Canadian freelancers — no processing fee and available through any Canadian bank.
A late fee is an additional charge on overdue invoices. In Canada you can charge one as long as the terms are disclosed upfront on the invoice or in a contract. A common rate is 1.5–2% per month (18–24% annually). GST/HST generally applies to late fees on commercial accounts.
Steps in order: send a reminder email referencing the invoice number and due date → apply a late fee if your terms allow it → send a formal demand letter → consider small claims court (limits vary by province: $35,000 in Ontario, $20,000 in BC, $15,000 in Quebec). Document everything.
Folyo handles GST, HST, QST, PST, and custom tax types automatically — so you can focus on the work, not the math.
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