Short answer: without a GST/HST number, you pay 5% to 15% on top of every dollar you spend on Amazon ads, and you never get it back. The rate depends on your province: 5% GST in Alberta, 13% HST in Ontario, 15% in the Atlantic provinces, and 5% GST plus 9.975% QST in Quebec. A Canadian KDP author can register voluntarily, far below the $30,000 small supplier threshold, and then claim that tax back. With $1,000 of ads a month in Ontario, the government keeps $1,560 a year that could stay with you.
For Canadian KDP authors, Merch on Demand designers and small sellers, from the Canada Revenue Agency (CRA), Revenu Québec, the Excise Tax Act and Amazon Ads' own pages, checked in October 2026. This is information, not tax advice: confirm your case with an accountant.
Work out what you lose with our free calculator
How much you lose each year
The tax on your ads is the rate of your province. Without a GST/HST number, it is a pure cost. On $1,000 of ads a month:
| Where you live | Tax on your ads | Lost per year |
|---|---|---|
| Alberta, B.C., Manitoba, Saskatchewan, territories | 5% GST | $600 |
| Ontario | 13% HST | $1,560 |
| Nova Scotia | 14% HST | $1,680 |
| New Brunswick, Newfoundland and Labrador, P.E.I. | 15% HST | $1,800 |
| Quebec | 5% GST + 9.975% QST | $1,797 |
Rates from the CRA's GST/HST table, in force since April 1, 2025. The provincial sales taxes of B.C., Manitoba and Saskatchewan are not covered here.
Why Amazon charges you this tax
Amazon adds the tax of your province to your ad fees. Its Tax Policy says "All Fees payable by Customer are exclusive of applicable taxes and duties, including VAT, GST/HST/QST".
Which Amazon company bills you depends on the marketplace your ads run on:
- amazon.ca: Amazon Advertising Canada, Inc., a Canadian company. It adds GST/HST to your ad fees, whether or not you are registered.
- amazon.com and the other marketplaces: an Amazon company outside Canada (Amazon Advertising LLC for amazon.com, for example). Amazon Ads' tax guide says it charges the tax of your country when you are "established in a country that has introduced ESS or remote services rules" and have "not provided Amazon with a valid VAT/GST registration number". Canada has such rules.
The Tax line at the bottom of your Amazon Ads invoice shows what you paid.
Can a KDP author register for GST/HST?
Yes. Below $30,000 you are a small supplier and do not have to, but you can. The CRA: a small supplier "may choose to register voluntarily if you make taxable sales, leases, or other supplies in Canada".
Your KDP royalties are what make it pay:
- What you sell Amazon is a copyright licence. Under the KDP agreement, you grant Amazon a "nonexclusive, irrevocable, right and license to print" and distribute your book. Your royalties are the price of that licence.
- You sell it to a company outside Canada. The KDP agreement pays royalties through "the Amazon party that made the sale (or whose affiliate made the sale)", and its parties are non-Canadian companies such as Amazon.com Services LLC. Amazon.ca lists Amazon.com Services LLC under the simplified GST/HST system, not the normal registration (Subdivision D of the Act).
- So your royalties are zero-rated. The Excise Tax Act zero-rates a licence of "copyright" supplied to "a non-resident person who is not registered under Subdivision D" (Schedule VI, Part V, section 10). That is exactly your case: you charge 0% on them.
- Zero-rated sales keep your right to claim. The CRA: on zero-rated supplies, "You may be eligible to claim input tax credits to recover GST/HST paid or payable". On exempt supplies, by contrast, you "generally cannot". Ads for your books serve those zero-rated sales, so their GST/HST comes back to you.
The CRA has never ruled on KDP royalties as such: if you want that in writing before you register, ask it for a GST/HST ruling on your case.
Royalties above $30,000: registration is not optional
Zero-rated royalties count toward the $30,000 threshold. The CRA counts "taxable sales, leases, and other supplies (including zero-rated supplies)", worldwide. Pass $30,000 over four consecutive calendar quarters and you must register. Many full-time authors already should be.
What changes once you are registered
- Register. Outside Quebec, with the CRA. In Quebec, with Revenu Québec, which registers you for both the GST/HST and the QST.
- Add your number to Amazon Ads. As a KDP author: Administration, Billing, Payment Settings, then the Tax info section.
- amazon.ca ads: Amazon Advertising Canada still shows GST/HST (and QST in Quebec) on the invoice. You claim it back on your return as input tax credits (and input tax refunds for the QST).
- Ads on other marketplaces: with a valid number, Amazon normally stops adding the tax. You have nothing to self-assess on services used "exclusively (90% or more)" in your commercial activities, which ads for your books are.
What it costs, and when it pays
Registering is not free:
- You stay registered at least one year. The CRA: "Stay registered for at least one year before you can cancel your registration."
- You file a return every year. With $1.5 million of taxable sales or less, the CRA assigns an annual reporting period. You can elect quarterly filing to get your refunds sooner. Returns are filed online.
- You keep records of every invoice.
Say software or a bookkeeper costs you $600 a year (our assumption, not an official figure). In Ontario, at 13%:
| Ads per month | HST claimed per year | Gain after $600 |
|---|---|---|
| $200 | $312 | −$288 |
| $400 | $624 | +$24 |
| $1,000 | $1,560 | +$960 |
| $3,000 | $4,680 | +$4,080 |
In Ontario, registering pays from about $400 of ads a month. At 5% GST, it takes $1,000 a month to cover the same $600.
The limits you need to know
Nothing is refunded for the past. Your registration usually takes effect on the day you ask for it, or up to 30 days before. Tax paid on ads before that date stays paid. Amazon refunds tax only with proof that "registration was active during the billing period".
If you sell to Canadians yourself, you charge GST/HST on those sales. Once registered, you "charge, collect and remit the GST/HST" on your taxable sales in Canada: books you sell at a fair, from your website or to a local shop. For an author whose income is KDP royalties, this rarely bites. Goods you sell on amazon.ca are another case: Amazon already charges GST/HST on them when you are not registered. The CRA: a platform operator must "charge and collect the GST/HST on the supply of qualifying goods that you facilitate through your platform and that are made by vendors who are not registered for the GST/HST (resident or not)" (CRA, supply of qualifying goods in Canada). Registering adds no tax to those sales; it only makes you the one who remits it. The cost falls on the sales you make outside Amazon. Registering pays when your income carries no tax, which is the case of KDP royalties. Selling goods on Amazon too? See GST/HST on Amazon ads for Canadian FBA and FBM sellers.
Merch on Demand: the same reasoning holds only if your Merch royalties, like KDP royalties, come from an Amazon company outside Canada. Check your Merch agreement with your accountant before you count on it.
Frequently asked questions
Do I charge GST/HST on my KDP royalties once registered?
No. They are a licence to a non-resident Amazon company that is not registered under the normal GST/HST system, so they are zero-rated: 0%.
I live in Quebec. Do I need two registrations?
You register once, with Revenu Québec, for both the GST/HST and the QST. Revenu Québec: a business that registers for the QST "must also register for the GST/HST", and must "remain registered for at least one year".
Will Amazon refund the tax I already paid?
Only for billing periods when your registration was already active. Ads billed before your registration date are not covered.
I spend $150 a month on ads. Should I register?
Probably not for this reason alone: in Ontario you would claim $234 a year, less than a typical bookkeeping bill. Run your own figures in the calculator.
Before you decide
Work out what you lose with our free calculator: enter your monthly ad spend, see the tax you pay each year and what registering would change. Then take the figure to your accountant.
Spending less on ads for the same sales helps too: see how much Sponsored Products ads cost and whether KDP authors can run Sponsored Brands ads. Authors elsewhere: Australia, New Zealand, Singapore.
Sources
- GST/HST calculator (and rates), CRA
- When to register for and start charging the GST/HST, CRA
- Register voluntarily for a GST/HST account, CRA
- Register for a GST/HST account (what counts toward $30,000), CRA
- Supply of qualifying goods in Canada (platform operators), CRA
- Type of supply (zero-rated, exempt, input tax credits), CRA
- General Information for GST/HST Registrants (RC4022) (reporting periods), CRA
- Excise Tax Act, Schedule VI, Part V (section 10), Justice Laws
- Small suppliers, Revenu Québec
- Services and intangible personal property acquired outside Canada, Revenu Québec
- Tax on digital products and services, Amazon.ca
- Amazon Advertising Agreement ("Amazon Contracting Party", "Elected Country") and Tax Policy, Amazon Ads
- Understanding taxes and regulatory fees on your advertising invoice, Amazon Ads
- Register your Tax ID and Tax refunds, Amazon Ads help
- KDP Terms and Conditions (the Amazon parties, royalties), Amazon KDP
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