Canada Revenue Agency
www.cra.gc.ca
Common menu bar links
Gift certificates
You do not collect GST/HST on the sale of a gift certificate. When a customer gives you a gift certificate towards a purchase, calculate GST/HST on the price of the item and deduct the amount of the gift certificate as if it were cash.
A gift certificate is generally a voucher, receipt, or ticket:
- that has a stated monetary value;
- that can be redeemed on the purchase price of a good or service from a specific supplier (the supplier agrees to accept the gift certificate as money for the purchase);
- for which money or other consideration in the amount of the certificate's face value is given to the issuer of the certificate; and
- that has no intrinsic value. For example, commemorative gold or silver coins have an intrinsic value.
Example
You sell a taxable item for $100, and the purchaser gives you a $20 gift certificate toward the purchase.
| Price of item | $100 |
|---|---|
| GST ($100 × 5%) | 5 |
| Subtotal | $105 |
| Less gift certificate | 20 |
| Customer pays | $85 |
