When the drop-shipment rules do not apply

The drop-shipment rules do not apply to common carriers that take possession of goods for the sole purpose of shipping the goods. In all cases, fees for shipping goods are subject to GST/HST.

We consider the transfer of the goods to the carrier for transportation and delivery to another person to be a transfer of physical possession of the goods to the person to whom the goods are to be delivered. That person can choose to follow the drop-shipment rules.

Forms and publications

• Guide RC4027, Doing Business in Canada - GST/HST Information for Non-Residents
• GST/HST Memoranda Series Chapter 3-3-1, Drop-shipments