PST Overview

Exemptions: School supplies
School supplies purchased by SFU for use in instructing students
School supplies purchased by students
PST on sales
PST on purchases
Links to PST bulletins

 

PST is a "use tax", designed to be paid by the end user of a product or service. Unlike the GST, there are no input tax credit or rebate mechanisms to recover any amounts of PST paid. As such, PST is an absolute cost to SFU.

In general terms, GST applies at the rate of 5% to most goods and services. There are a few categories of exemptions, such as basic groceries, prescription drugs, residential rent, educational services, and financial services. PST, at the rate of 7%, generally applies to most goods but only to a few services (i.e.  legal services, services to tangible personal property or goods, telecommunications services, and short-term accommodation service). Furthermore, there are a number of goods that are exempt of PST. For example, goods for resale, books, certain school supplies, groceries and restaurant meals, and children's clothing are exempt of PST.

Vendors who sell taxable tangible personal property or services in BC are required to register for PST and collect the tax. Tax is required to be remitted on a regular basis, usually monthly.

The following are the PST rates in BC:

 

Tax

Rate

BC PST on taxable goods and services

7%

Innovative Clean Energy fund on energy products

0.40%

BC PST on accommodation

8% + 2% municipal tax in Burnaby

Liquor tax

10%

Passenger vehicle rentals

$1.50 per day

Private vehicle sales

12%

Luxury passenger vehicles

8% to 10%

Exemptions: School supplies

While there are many exemptions from PST, the most important category for SFU is school supplies. This category of exemptions includes rules relating to school supplies purchased by students, as well as rules relating to supplies purchased by school and post-secondary institutions, such as SFU, for educational and instructional purposes.

School supplies purchased by SFU for use in instructing students

When purchasing the goods listed below, SFU should provide a purchase order to the vendor, clearly indicating the portion of the school supplies being purchased that will be used by students or for instructing students. SFU will then be able to purchase these items exempt of PST.

When a department purchases school supplies that will be used for both administrative use and for instructing students, a calculation should be performed to determine the percentage of use in instructing students versus administration. Then, when purchasing school supplies, SFU should clearly state on the purchase order the percentage of the goods purchased relating to instructing students, in order to obtain an exemption of PST on that portion of the purchase

 

School supplies - SFU purchases

PST- exempt

Animals, either living or dead, and parts of animals obtained for use in scientific research or experiments

Cellulose tape

Chalk

Charts, diagrams, and maps

Lesson notes, précis, examinations, test papers, answer keys, work sheets, and other similar materials, as well as material to manufacture those materials

Paper clips

Pens and markers for use on whiteboards

Photocopier toner obtained by SFU is exempt from PST in respect of the portion of the photocopier toner that can reasonably be attributed to the use of the toner in making copies:

·         For the use of students

·         For use in instructing students

Rubber bands

Software obtained for use:

·         On a computer

·         Substantially as a teaching aid for students

Staples

Supplies and materials obtained for consumption in arts courses, other than the following:

·         Instrument picks and strings

·         Tools and equipment

Supplies and materials obtained for consumption in commercial or business courses, other than tools and equipment

Supplies and materials obtained for consumption in home economics courses, other than the following:

·         Cutlery, dishes, pots, and pans

·         Table linen and towels

·         Bobbins, needles, scissors, sewing machine attachments, and tape measures

·         Tools and equipment

Supplies and materials, including chemicals, obtained for consumption in science courses, other than the following:

·         Alcohol burner wicks

·         Containers obtained for use as hazardous waste disposal units for phlebotomy sharps

·         Fossils, rocks, minerals, and other geological specimens

·         Gas lighter flints

·         Glassware

·         Lubricants obtained for use to maintain and prevent spotting, staining, and rusting of surgical instruments

·         Needles

·         Non-disposable gloves

·         Osteological preparations

·         Animal feed

·         Supplies for animals

·         Prepared microscope slides

·         Preserved specimens for display

·         Skeletons

·         Surgical instruments

·         Syringes

·         Tools and equipment

Supplies and materials obtained for consumption in woodworking, metal working, or other industrial arts courses, other than tools and equipment, including drill bits, re-usable electrical and electronic parts, grinding wheels, and saw blades

Supplies and materials obtained for consumption in vocational training courses, other than tools and equipment

Visual or audio aids and recordings, other than the following:

·         Educational toys, geometric forms, models, display stands, and felt boards

·         Equipment obtained for use to record, play, project, view, or access audio or video

Wooden pencil boxes

 

The following items are specifically listed as taxable for PST

 

School supplies - SFU purchases

PST Taxable

Chalkboards, chalkboard erasers, and chalkboard cleaning materials

Whiteboards, whiteboard erasers, and whiteboard cleaning materials

Software obtained for use:

·         On a computer, and

·         By teachers to assess or evaluate students or to report on students' progress

Plaques, trophies, awards, certificates, and stickers

Administrative, cleaning and maintenance supplies

Equipment, such as computers, photocopiers, primnters and replacement parts for equipment

Software for adminsitrative purposes

 

School supplies purchased by students

The following listing of school supplies are exempt of PST when purchased by a student who is enrolled in an educational program or is being educated at home. Please note that this is an exhaustive list; therefore, any school supplies not included in the list below are taxable for PST purposes. This list is relevant for sales from the bookstore to students. In order to obtain this exemption, the student must make a verbal declaration to the cashier that the purchases are for use in school/university.

 

School supplies - Student purchases

 

PST-exempt

 

Bags specifically designed to carry school books and supplies, other than the following:

Ink

 

Lined, unlined, drawing, graph, and music manuscript paper

 

·         Attaché cases

 

·         Backpacks

Paints and paint brushes, other than theatrical make-up and brushes and carrying cases associated with that make-up

 

·         Bags with wheels

 

·         Briefcases

 

·         Knapsacks

Pencil and wax crayons

 

·         Sports bags

Pencils

 

·         Tote bags

Pens, other than fountain pens and nibs

 

Drawing instruments, including geometry instruments

Ring binders

 

Rulers

 

Erasers

School art portfolios

 

Glue (including glue sticks)

Work books, including exercise books and scrapbooks

 

PST on sales

University departments must charge PST on supplies of taxable goods and services made in BC. The PST collected should be stated separately on the sale invoices/receipts.

If departments sell goods for resale and the purchaser requests an exemption, the purchaser’s PST number should be included on the invoice issued by SFU to support that the sale was made exempt as the goods are being purchased for re-sale.

The following G/L code should be used when collecting PST on sales:

 

Province where sale is made:

PST rate

GL code

GL code description

BC

7%

11-9999/99999-2100

BC PST payable

PST on purchases

SFU departments should obtain an exemption of PST from suppliers, when acquiring goods for re-sale or for lease to third parties. In order to obtain the exemption, the department must provide SFU’s PST number to the vendor

SFU’s PST number is PST-1000-6004.

SFU Sales on PST

When selling the goods, the SFU department making the sale should charge PST on taxable supplies of goods/services.

Example: Merchandise sold at the bookstore should be purchased without paying PST to the vendor by presenting SFU's PST number. The bookstore should charge PST on applicable merchandise at the point of sale (unless the merchandise qualifies as an exempt school supply).

 

Note

The PST should generally be paid only once by the final consumer. If there are any situations where double taxation is apparent, further analysis should be performed to determine if the PST rules have been applied correctly. Contact Sabina Diaconescu at

778-782-7255 for further advice.

Links to PST bulletins

BC Government Bulletins and Publications

BC Government Frequently Asked Questions

 

 

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