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ARTICLE · 20 SEPTEMBER 2024

Is Your Business Ready For Canada's Digital Services Tax?

Gowling WLG
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Canada's digital clock has finally struck midnight. On June 28, 2024, the Digital Services Tax Act ("DSTA") came into force by Order-in-Council, following the Royal Assent of its enacting legislation the previous week.

CanadaTax
Eric Hendry
Eric Hendry
Laura Gheorghiu
Laura Gheorghiu
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Co-authored by Summer Law Student Shira Gerstein

Canada's digital clock has finally struck midnight. On June 28, 2024, the Digital Services Tax Act ("DSTA") came into force by Order-in-Council, following the Royal Assent of its enacting legislation the previous week. Shortly thereafter, the Department of Finance released an updated version of the DSTA's explanatory notes (the "Notes") available here. The revised Notes contain updated guidance to reflect changes to the DSTA since the previous Draft was released in 2023, as well as new examples illustrating the DSTA's intended application to certain businesses.

Taxpayers that find themselves in the DSTA's scope are required to apply to register with the Canada Revenue Agency ("CRA") by January 31, 2025. Digital services tax ("DST") for calendar years 2022, 2023, and 2024 will be payable by June 30, 2025. Businesses that earn revenue from online platforms should carefully review the legislation in the coming months

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