Etsy Seller Canada 2026 — Taxes, Fees, HST & Profit Calculator

Etsy has become one of Canada's most popular platforms for creative entrepreneurs selling handmade goods, vintage items, digital downloads, and craft supplies. But navigating Etsy's fee structure, HST on Canadian sales, and CRA reporting requirements can be overwhelming. This guide gives Canadian Etsy sellers a complete tax and profit picture for 2026.

Etsy's Fee Structure in Canada

Etsy charges Canadian sellers multiple fees that must be tracked for accurate profit calculation and tax deductions:

Fee Type	Amount	Notes
Listing fee	USD $0.20 per listing	Charged on listing + renewal
Transaction fee	6.5% of sale price + shipping	Applied to total payment
Payment processing	~3% + $0.25 CAD	Through Etsy Payments
Offsite Ads fee	12–15% on attributed sales	If you qualify and opt in
Etsy Ads (optional)	CPC — your budget	100% deductible

On a $50 CAD sale with $8 shipping, a seller's fees are approximately: $0.27 listing + $3.77 transaction + $1.75 processing = $5.79 in fees, netting you $52.21 before materials and your time.

HST/GST: When Do You Charge It?

Etsy Canada collects and remits HST on sales to Canadian buyers on behalf of sellers registered in Canada. However, once you are personally GST/HST registered (past $30,000 threshold), you must include your HST number in your Etsy shop and coordinate with Etsy's marketplace facilitator remittance. Key rules:

Sales to Canadian buyers (below $30K threshold): Etsy collects and remits HST — you are not directly involved
Sales to Canadian buyers (above $30K, registered): Coordinate your HST number with Etsy to avoid double-collection
Sales to US/international buyers: Zero-rated — no Canadian HST
Digital downloads: Taxable supplies — HST rules apply to Canadian buyers

Etsy Profit Calculator — calcEtsyProfit

Monthly gross Etsy revenue (CAD $) Monthly material costs ($) Monthly Etsy fees (est. 10–12% of revenue) Monthly shipping supplies ($) Monthly Etsy Ads spend ($) Other monthly expenses ($) Province marginal tax rate (%)

Deductible Expenses for Etsy Sellers

Materials and supplies: Raw materials, yarn, wood, fabric, resin, paints — 100% deductible
All Etsy fees: Listing, transaction, payment processing, Offsite Ads, Etsy Ads — 100%
Shipping supplies: Boxes, mailers, tissue paper, tape, labels — 100%
Shipping costs: Postage, courier fees, tracking — 100%
Photography equipment: For product photos — CCA or immediate expensing
Home workspace: Dedicated studio or workshop space in home
Tools and equipment: Sewing machines, laser cutters, looms — CCA Class 8
Digital download delivery costs: Hosting, design software subscriptions

Inventory Tracking

For physical product sellers, the CRA requires you to account for opening and closing inventory on T2125. Ending inventory reduces your cost of goods sold. Keep track of your raw material stock and finished goods at year-end. For small sellers, a simple spreadsheet listing items and cost works. For larger operations, accounting software like Wave (free) or QuickBooks makes inventory tracking manageable.

Separate Bank Account: Open a dedicated bank account for your Etsy business. Deposit all Etsy payouts here. Pay all materials and supplies from this account. This creates a clean paper trail for the CRA and dramatically simplifies bookkeeping at year-end. KOHO's no-fee account is ideal — no monthly fees eating into your margins.

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Related Canadian Tax Guides

Self-Employed Taxes Canada — Complete Guide GST/HST for Small Business Canada Quarterly Tax Installments — When & How