Ontario Real Estate Licensing Exam Practice · Question
A real estate salesperson earns a commission of $20,000 on a property sale. How is HST applied to this commission?
Real estate services, including commissions, are considered taxable supplies under the Excise Tax Act. Therefore, HST at 13% is typically charged on top of the
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Question: A real estate salesperson earns a commission of $20,000 on a property sale. How is HST applied to this commission?
Answer options:
- HST at 13% is included in the $20,000 and not added on top. ✅ HST at 13% is added to the $20,000, to be paid by the client.
- Real estate commissions are not subject to HST.
- HST is applied only if the commission exceeds $30,000.
Correct answer: HST at 13% is added to the $20,000, to be paid by the client.
Explanation: Real estate services, including commissions, are considered taxable supplies under the Excise Tax Act. Therefore, HST at 13% is typically charged on top of the commission amount unless otherwise specified in the agreement.
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