1. What is TPS?

TPS (Taxe sur les Produits et Services) is a Canadian value-added tax levied on most goods and services sold for domestic consumption. The standard rate is 5% in most provinces.

2. How Does the Calculator Work?

The calculator uses the simple TPS formula:

Where:

• \( Price \) — The pre-tax price of goods or services in Canadian dollars
• \( 0.05 \) — The standard TPS rate (5%)

3. Importance of TPS Calculation

Details: Accurate TPS calculation is important for businesses to properly charge and remit taxes, and for consumers to understand the total cost of purchases.

4. Using the Calculator

Tips: Enter the pre-tax price in Canadian dollars. The value must be greater than 0. The calculator will compute the TPS amount at 5%.

5. Frequently Asked Questions (FAQ)

Q1: Is TPS the same across all Canadian provinces?
A: No, some provinces have a Harmonized Sales Tax (HST) that combines TPS with provincial sales tax at different rates.

Q2: Are all goods and services subject to TPS?
A: No, certain items like basic groceries, prescription drugs, and medical devices are exempt.

Q3: How often should businesses remit TPS?
A: It depends on the business's annual revenue, ranging from monthly to quarterly or annually.

Q4: Can businesses claim TPS credits?
A: Yes, registered businesses can claim input tax credits for TPS paid on business expenses.

Q5: What's the difference between TPS and TVQ?
A: TVQ is Quebec's provincial sales tax (9.975%), while TPS is the federal tax (5%). Quebec applies both taxes.