TORONTO—The Ontario Ministry of Finance has released a new guide that will help graphic designers understand how RST (retail sales tax) applies to their business expenses. The 520 RST Guide for Graphic Designers clarifies when graphic design firms and freelance graphic designers should be charging RST – more commonly referred to as PST – and how to determine whether it should be paid by the customer or the designer.

This guide will help graphic designers maintain consistency in their rates until the new harmonized sales tax takes effect in July 2010. (For more on HST, see the upcoming July/August issue of Design Edge Canada.) It explains, for instance, that design services are not subject to RST if they do not result in “tangible personal property.” However, certain purchases – including art supplies, cameras and office supplies – are taxable if used in the preparation of a service.

According to the document, RST applies to “all charges billed to a customer after an agreement is entered into for the sale of a tangible product.” The vendor must make a clear record of the agreement date and then collect RST at eight per cent of the design’s value. Some examples of tangible designs include brochures, pamphlets and business cards.

The Association of Registered Graphic Designers of Ontario is hosting a teleseminar on July 21 with tax commodities expert Cyndee Todgham Cherniak to explain the guide and discuss how the upcoming harmonized sales tax will affect graphic designers. To register for the teleseminar, email rsvp@rgdontario.com or call 1 888 274 3668 x 26. To read the full RST Guide, go to www.rev.gov.on.ca/english/guides/rst/520.html