1. What is TPS?

TPS (Taxe sur les Produits et Services) is a Canadian value-added tax of 5% applied to most goods and services sold or provided in Canada.

2. How Does the Calculator Work?

The calculator uses the TPS formula:

Where:

• \( Price \) — The base price before tax (CAD)
• \( 0.05 \) — The TPS rate (5%)

Explanation: The calculation simply multiplies the pre-tax price by 5% to determine the TPS amount.

3. Importance of TPS Calculation

Details: Accurate TPS calculation is important for proper accounting, pricing, and tax reporting for businesses and consumers in Canada.

4. Using the Calculator

Tips: Enter the price in Canadian dollars (CAD) before taxes. The value must be greater than 0.

5. Frequently Asked Questions (FAQ)

Q1: Is TPS the same across all of Canada?
A: Yes, TPS is a federal tax applied at 5% nationwide. Some provinces combine it with provincial sales tax.

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 is TPS different from TVQ?
A: TVQ is Quebec's provincial sales tax (9.975%), while TPS is the federal tax. Both may apply in Quebec.

Q4: Do tourists pay TPS?
A: Yes, but non-residents may be eligible for rebates on certain goods and short-term accommodations.

Q5: How often is TPS collected?
A: Businesses must remit TPS to the government either monthly, quarterly, or annually, depending on their revenue.