Zoom has started to notify paying Canadian customers that it is going to charge and collect GST/HST where applicable starting June 1st.
University of Ottawa professor Michael Geist posted a screenshot of the notice on Twitter. The notice indicates that this change is due to “international developments regarding the taxation of electronically supplied services with Goods and Service Tax (GST)/ Harmonized Sales Tax (HST).”
It’s important to note that rules regarding federal sales tax on digital services have not recently changed in Canada.
.@zoom_us advises paying Canadian subscribers that it will begin collecting and remitting GST/HST starting next month. Says this is due to international developments, though Canadian federal sales tax rules on digital services remain unchanged. pic.twitter.com/xhnaxHVUd0
— Michael Geist (@mgeist) May 20, 2020
The notice sent to paying subscribers says that this change goes into effect on or shortly after June 1, 2020. Once the change is implemented, invoices issued by Zoom will include its GST/HST account number.
Zoom notes that it will only be collecting GST/HST for invoices generated on or after June 1st, and that invoices from prior periods will not be impacted.
MobileSyrup has reached out to Zoom for more information.
Update 27/05/20: Zoom has provided MobileSyrup with the following statement: “Like many companies with a growing international presence, Zoom is routinely evaluating its indirect tax collection and remittance obligations. The application of these taxes to businesses with online activities is a complex and evolving area. Zoom continues to review such developments, as well as the nature and extent of its activities in different jurisdictions, and based on such regular review will from time to time start charging indirect taxes where applicable.”