Seller Tax Guide

Canada

GST/HST registration

If your total worldwide taxable sales exceed $30,000 CAD in a single calendar quarter OR in the four preceding consecutive quarters, you must register for GST/HST with the CRA. You are no longer a "small supplier" and must begin charging GST/HST immediately — including on the sale that pushed you over.

• Threshold: $30,000 CAD in 1 quarter or 4 consecutive quarters
• Must register with CRA within 29 days of exceeding the threshold
• GST rate: 5% (HST varies by province: 13% Ontario, 15% Atlantic)
• Voluntary registration is allowed and entitles you to claim Input Tax Credits
• Below the threshold? You're exempt — no registration or collection required

Quebec QST

Quebec has its own sales tax (QST) at 9.975%, administered by Revenu Québec (separate from CRA). The small supplier threshold mirrors the federal $30,000 CAD. As a marketplace facilitator operating in Quebec, Tokyofishmarket may be required to collect QST on your behalf for sales to Quebec consumers.

Income tax

Income from marketplace sales is taxable. The CRA distinguishes between hobby selling and business activity using "Badges of Trade" — if you buy specifically to resell, maintain inventory, and sell regularly, it's business income.

• Business income: reported on form T2125 with your T1 return
• Self-employment income triggers CPP contributions
• Capital gains on personal collectibles sold for over $1,000: taxable at 50% inclusion rate
• Losses on personal-use property are NOT deductible
• Filing deadline: April 30 (June 15 for self-employed, but balance owed by April 30)

What gets reported to CRA

Starting January 2024, digital platforms in Canada must report seller information to CRA under the Digital Platform Reporting Rules. This includes your name, address, date of birth, SIN/BN, and total quarterly earnings. Stripe/Tokyofishmarket may also issue T4A slips for fees paid over $500.

United States

1099-K reporting

Under the One Big Beautiful Bill Act (signed July 2025), the 1099-K threshold reverted to the pre-2021 levels: over $20,000 AND over 200 transactions per year. Both conditions must be met. The $600 threshold from 2021 is fully repealed.

• Threshold: >$20,000 AND >200 transactions per platform per year
• 1099-K reports gross payments (before fees, refunds, chargebacks)
• Thresholds apply per platform — not combined across platforms
• Regardless of whether you receive a 1099-K, all taxable income must be reported
• Some states have lower thresholds — check your state's rules

Sales tax

All US states with a sales tax now have marketplace facilitator laws. This means the platform — not the individual seller — is responsible for calculating, collecting, and remitting sales tax on marketplace transactions. You generally don't need to worry about sales tax collection for marketplace sales.

Income tax

Marketplace income is reported on Schedule C (sole proprietors). Subject to both income tax and self-employment tax (15.3%). Collectibles held over 1 year and sold at a gain are taxed at a maximum 28% capital gains rate — higher than the standard 15-20% for other assets.

Japan

Consumption tax (消費税)

Japanese sellers are exempt from consumption tax (JCT) if taxable sales in the base period are 10 million yen or less (~$63,000-67,000 USD). The base period is two years prior for sole proprietors.

• Standard rate: 10% (7.8% national + 2.2% local)
• Exemption threshold: 10 million yen in the base period
• Export transactions qualify for zero rate
• The Invoice System (インボイス制度, effective Oct 2023) requires registration as a Qualified Invoice Issuer to allow business buyers to claim input tax credits

Invoice System (インボイス制度)

Since October 2023, Japan requires businesses to register as Qualified Invoice Issuers. If you're not registered, your business customers can't claim full input tax credits on purchases from you. Small sellers under 10 million yen can register voluntarily but will then owe JCT. A transitional credit schedule applies: 80% credit through September 2026, 50% through September 2029, 0% after.

What to track

Keep records of everything. The CRA requires 6 years, the IRS 3-7 years, and Japan's NTA requires 7 years.

• Every sale: date, item, price, currency, buyer jurisdiction
• Cost basis: what you paid for each item (keep receipts)
• Platform fees and commissions per transaction
• Shipping costs: postage, courier, insurance
• Packaging materials: boxes, tape, bubble wrap
• Currency exchange rates on the date of each transaction
• Returns and refunds with full documentation
• Running inventory count with acquisition dates and costs

Common seller deductions

If your selling activity qualifies as a business (not a hobby), these are commonly deductible:

• Cost of goods sold — purchase price of items for resale
• Platform fees — commission, listing fees, payment processing
• Shipping and postage — carrier fees, tracked shipping, insurance
• Packaging supplies — boxes, tape, bubble wrap, labels
• Photography equipment — camera, lighting, backdrop (if used primarily for listings)
• Home office — proportional rent/utilities/internet if dedicated space
• Storage — dedicated unit or allocated home space for inventory
• Software and tools — inventory management, accounting software
• Professional services — accounting fees, tax preparation

Need help?

This guide covers the basics, but tax situations vary. If you're earning significant income from marketplace sales, consult a qualified tax professional in your jurisdiction. They can help you structure your business, maximize deductions, and stay compliant.