--- Page 1 ---
saskatchewan.ca 
 
   
 
 
 
PST-12  Issued: February 1985 Revised: July 2024 
 
 
THE PROVINCIAL SALES TAX ACT 
 
SERVICES TO REAL PROPERTY 
 
This bulletin has been prepared to help you apply and collect the Provincial Sales Tax (PST). It is a 
general guide and not a substitute for the legislation. 
 
Changes to this bulletin are indicated by a bar (|) in the left margin. 
 
The contents of this bulletin are presented under the following sections: 
A. Registration and Reporting Requirements 
B. Collection and Remittance of Tax 
C. Services to Real Property 
D. Definition of Real Property 
E. Contract Materials 
F. Consumables and Equipment 
G. Surety Bonds 
H. Subcontractors 
I. Builders of Residential or Commercial Premises 
J. Land Development Services 
K. Renovations to Real Property for Resale 
L. Exempt Services 
M. Consulting and Supervision Services 
N. Contractors Who Make Retail Sales 
O. Casual Rentals 
P. Services to Real Property on Indian Reserves 
Q. Bonding and Clearance Process and Ensuring Contractor Holds a Valid Licence 
R. Sales of Used Business Assets 
S. Goods and Services for Your Own Use 
T. Tax Tips Line 
U. Saskatchewan eTax Services (SETS) 
 
A. R EGISTRATION AND REPORTING REQUIREMENTS  
 
Businesses providing services to real property are required to be registered with the Revenue 
Division as Licensed Vendors for the purpose of collecting and remitting PST on their sales of 
taxable goods and services. Licensed vendors must also report any tax payable on equipment, 
supplies and taxable services purchased for their own consumption or use. 
 
Contractors not previously registered for PST are required to become licensed by completing the 
Application for Vendor’s Licence/Consumer Registration. 
Information Bulletin

--- Page 2 ---
- 2 - 
saskatchewan.ca 
 
B. COLLECTION AND REMITTANCE OF TAX 
 
Generally, PST must be collected on the invoice to the customer and remitted to the Ministry of 
Finance by the return due date, regardless of whether the customer has paid their invoice/account 
in full. 
 
For construction contracts where construction extends over a period of time, the written contract 
often calls for the purchaser to make progress payments as work on the project proceeds. These 
payments are not deposits and are usually for work completed, but may also be made in 
anticipation of work being completed. 
 
The requirement for the collection of PST on progress payments aligns with the guidelines in place 
for the collection of GST. PST is collectible on each progress payment on the earlier of: 
 
• the day the purchaser pays the progress payment, or 
• the day the progress payment becomes due. 
 
Where there are contract holdback amounts, PST is collectible on the amount of the holdback on 
the earlier of: 
 
• the day the purchaser pays the amount of the holdback, or 
• the day the holdback period expires. 
 
Note: For detailed information regarding vendor responsibilities, and tax return filing 
(including filing frequencies and due dates), please see Information Bulletin  
PST-5, Registration and Reporting Requirements. 
 
 
C. SERVICES TO REAL PROPERTY 
 
Taxable services to real property include construction, alteration, repair, erection, demolition, 
remodeling, or improvement of real property or a building or other structure on real property, or 
any other service in relation to real property or a building or other structure on real property. 
Please see Section L
 for services that are exempt from PST. 
 
A contractor engaged in services to real property is required to collect PST on the total charge to 
the customer for the services, including all related charges and fees such as charges for labour, 
materials, transportation, insurance, permits, service fees, and any tax, levy or duty, other than 
the GST. PST must be shown as a separate line item on the invoice to the customer. 
 
 
D. DEFINITION OF REAL PROPERTY 
 
Real Property includes land or buildings or property that is permanently attached to land or 
buildings. In general, goods become real property upon installation when affixed or attached to the 
land or building in a permanent manner (i.e. sunk into, cemented into, bolted to, built or framed 
into, plumbed or wired into, or otherwise secured), thereby becoming an integral component of 
the property. The goods become a permanent and substantial improvement to the real property, 
being attached to the building such that they add value and cannot be easily removed.

--- Page 3 ---
- 3 - 
saskatchewan.ca 
 
Examples of items that become real property when installed in a building or attached to land 
include windows, doors, light fixtures, furnaces, central air conditioners, railings, underground 
sprinklers, fences and plumbing materials. 
 
In addition, items that are so large and heavy they cannot be moved may also be considered real 
property, even if they are not otherwise affixed to the land or a building. For example, most 
production machinery and equipment is considered to become real property after being 
permanently installed and becoming an integral component of a processing activity, regardless of 
being attached or affixed to the land or building. 
 
 
E. CONTRACT MATERIALS 
 
Contractors and subcontractors acquiring materials that are resold or incorporated into a real 
property contract may purchase these items exempt from PST by quoting their vendor’s licence 
number to their suppliers. This includes the following: 
 
• Materials that are resold as part of the contract; 
• Nails, screws and fasteners; and, 
• Materials such as dimensional lumber, plywood and similar building materials used on site 
for bracing or to build forms for use on a particular contract (Note: Contractors must pay PST 
on metal or lumber used for bracing or to build forms that are capitalized in the contractor’s 
records and used repeatedly as tools/equipment). 
 
Contractors may claim a credit for any PST that has been paid on materials sold or incorporated 
into a real property contract where PST is collected. Credits claimed will be subject to audit 
verification and can be used to reduce the tax reported and remitted. 
 
Note: Internal credits cannot be taken on goods or services purchased for own use. See Information 
Bulletin PST 5, Registration and Reporting Requirements
 for more details on internal credits. 
 
When materials are taken from an exempt resale inventory for the contractor’s own personal or 
business use, the PST must be self-assessed on the cost of the materials and remitted directly to 
Finance using the regular PST return form. PST continues to apply to new and used equipment, 
supplies/consumables and taxable services purchased for use in the contractor’s business 
operations. 
 
Suppliers are required to search the customer’s business name on the PST On-Line Registry to 
verify that a business holds a valid PST vendor’s licence before selling the goods or services tax 
free for resale. If valid, the vendor number must be recorded on the invoice at the time of sale or 
retained in the supplier’s records. The online registry is available 24/7 and may be accessed at 
the following link: sets.saskatchewan.ca/rptp/portal/footer/pst-registry/
. 
 
 
F. CONSUMABLES AND EQUIPMENT 
 
Contractors engaging in services to real property must not use a vendor’s licence number to 
purchase materials or equipment exempt from PST when acquiring such goods for their own use 
or consumption.

--- Page 4 ---
- 4 - 
saskatchewan.ca 
 
Contractors and subcontractors are required to pay PST on their purchase cost of consumables 
and equipment used in the completion of a real property contract. These items may not be 
purchased exempt from PST. 
 
Examples include: 
 
• All equipment and hand tools; 
• Scrapers, pails, paint brushes, rollers, sleeves, trays and tape; 
• Cutting attachments for power and air tools, such as blades and drill bits; 
• Abrasives such as grinding wheels, sanding belts, discs and sandpaper; 
• Electrical cords and extension cords; 
• Gloves, safety glasses and coveralls; and, 
• Tarps and blankets. 
 
If PST is not collected by the supplier on the purchase of equipment and consumables, the 
contractor must self-assess and remit the tax directly to Finance using their regular PST return 
form. 
 
Note: Non-resident contractors, please see Information Bulletin 
PST-38, Non-Resident Real 
Property and Service Contractors f or detailed information regarding the calculation of 
PST on taxable vehicles and equipment. 
 
Rented and Leased Equipment 
 
Contractors are required to pay tax on charges for rented and leased equipment. All tools and 
equipment used by the contractor to complete real property work are considered to be for the 
contractor’s own use. 
 
PST also applies to the rental of cranes and scaffolding but differs from the usual application of 
tax for rental equipment. See Information Bulletin PST-72, Rental Businesses
 for further 
information. 
 
 
G. SURETY BONDS 
 
A surety bond protects a principal against losses, up to the limit of the bond, should the 
contractor fail to perform their obligations under the contract. The contractor purchases the 
bond at the request of the principal, who is the beneficiary of the bond. The principal will then 
reimburse the contractor for this expense. 
 
Since a surety bond provides protection to the principal against loss should the contractor 
default, it is considered an insurance product and the fees and/or premiums paid by the 
contractor to acquire the insurance are subject to PST. 
 
The contractor is not required to collect PST on this item, providing it is listed and identified 
separately on the invoice to the customer.

--- Page 5 ---
- 5 - 
saskatchewan.ca 
 
H. SUBCONTRACTORS 
 
Subcontractors are not required to collect PST on services provided to a contractor who is 
licensed as a vendor and indicates they are acquiring the subcontractor’s service for resale, since 
the contractor will collect PST on the total charge to their customer. To purchase the 
services of the subcontractor without paying the PST, the contractor must quote their vendor’s 
licence number to the subcontractor and the subcontractor must record this number on the 
invoice. 
 
 
I. BUILDERS OF RESIDENTIAL COMMERCIAL PREMISES 
 
Builders of new residential or commercial premises for resale are required to collect PST on the 
retail selling price of the premises, excluding the fair market value of the land. 
 
In these instances, the builder is not considered the consumer or user in the building of the 
premises, providing: 
 
(a) The premises are sold to the customer at fair market value; 
(b) The builder includes in the sale to the customer all materials and services to real property 
acquired and provided by the builder that form part of the value of the premises sold to the 
customer; and, 
(c) The premises remains in the builder’s salable inventory and use of the premises does not 
change. (i.e. the premises remains for sale by the builder and is not used, rented, or 
otherwise occupied). 
 
Note: When the builder retains ownership of a new residential or commercial premises, they are 
considered to be the consumer or user of the building. The builder is required to pay tax on 
subcontractor services and all contract materials consumed in the build. Examples include 
the construction of apartment complexes, corporate offices, and life lease housing. 
 
 
J. LAND DEVELOPMENT SERVICES 
 
Land development services, generally consisting of improvements to land such as adding roads, 
landscaping, bridges, sewer systems, water supply, electrical grids, telecommunication systems, 
etc., are subject to PST, as outlined below: 
 
• The sale of residential and commercial lots or land is not subject to PST. Therefore, the land 
developer is considered to be the consumer of the land development services as they will not 
collect PST upon sale of the land to their customers. 
• Contractors are required to collect PST on the total charge to the land developer for the land 
development services. The contractor will purchase materials for resale exempt from PST by 
quoting their vendor’s licence number to their suppliers. 
• In situations where specific services will be rebilled to the municipality, the land developer 
must quote their vendor’s licence number to the contractor in order to purchase the service 
exempt from PST and must collect the PST on the services when rebilled to the municipality.

--- Page 6 ---
- 6 - 
saskatchewan.ca 
 
K. RENOVATIONS TO USED REAL PROPERTY FOR RESALE 
 
The application of PST in relation to used residential and commercial properties (land and 
buildings) purchased by businesses or individuals for the purpose of renovating and reselling 
them is outlined below: 
 
• Used residential and commercial properties with existing homes or buildings are not subject 
to PST at the time of purchase (other than taxable realtor commissions). 
• The purchaser of the used property is considered to be the consumer of the improvements 
made to the land and existing structures, and must pay PST on their cost of all taxable goods 
and services acquired for the completion of the project, including engineering design, 
contract materials, and subcontractor services etc. 
• The renovated property is not subject to PST when it is resold. 
 
 
L. EXEMPT SERVICES 
 
The following services are exempt from PST if they are provided separately and are not billed in 
connection with taxable services to real property. The contractor must pay PST on the laid-down 
cost of all equipment, materials and consumables used in providing these services. 
 
• Collection, clearing and removal of garbage or debris from land that does not alter the land 
and does not form part of an otherwise taxable service such as a landscaping or demolition 
service; 
• Snow clearing and snow removal services; 
• Lawn & yard care services, including fertilizer or chemical application, aeration, thatching, 
mulching, or mowing (Note: Sprinkler blowout services are exempt from PST; however, 
irrigation system installation and repairs are taxable.); 
• Maintenance, such as tree and bush trimming/pruning services, of plants grown in the 
ground or in containers that qualify as real property (Note: These services improve the 
overall health of the plant or return an overgrown plant to the desired shape or size. Planting 
saplings, tree relocation, tree removal and stump grinding are taxable real property 
services.); 
• Pest control services; 
• Septic services that involve emptying or pumping out sewage or effluent storage tanks; 
• Routine services to empty and clean grease traps and oil collection drains (Note: Services to 
unclog/repair drains are taxable.); 
• Grave digging services; 
• Services that are a primary farming activity, including land clearing, land levelling, land 
reclamation or other services provided to a farmer for the purpose of either expanding 
cultivated acreage to grow crops or expanding the land available to animals for forage or 
grazing; 
• Labour for the installation of exempt farm equipment incorporated into real property, 
effective April 1, 2020 (Note: For further information on exempt farm equipment, please see 
Information Bulletin PST-16, Farm Implements and Supplies
.);

--- Page 7 ---
- 7 - 
saskatchewan.ca 
 
• On-farm trenching services provided to a farmer for the purpose of electrifying grain bins, or 
for the purpose of installing pipe for irrigation of crops or watering of livestock, effective 
April 1, 2022; 
• On-farm dugout excavation services provided to a farmer for the purpose of spraying, 
irrigation of crops, or watering of livestock, effective April 1, 2022; 
• Installation of exempt special equipment designed solely for the use of blind persons, 
physically handicapped persons or chronic invalids, that is not purchased by or for use in a 
hospital, nursing home or similar institution providing medical or palliative care, effective 
April 1, 2023 (Note: The exemption includes contracts involving individuals, schools, places 
of worship, office buildings, private residences, etc. Examples of exempt special equipment 
include wheelchair lifts, stairway elevators, and walk-in safety baths. For further information 
please see Information Bulletin PST 42 – Medical Equipment and Supplies
.); 
• Inspection services provided in relation to the purchase of real property; and, 
• Inspection or examination services completed: 
ο For the purpose of providing a quote with respect to evaluating damages and estimating 
the cost of repairs; 
ο As part of a general preventative maintenance schedule for the purpose of detecting or 
identifying potential repairs, and the repair or maintenance is completed separately from 
the inspection, not forming part of that inspection service; 
ο For the purpose of ensuring that safety standards as required by law are met; 
ο For the purpose of determining the remaining useful life of a component of tangible 
personal property that has been installed into real property; and, 
ο To monitor the operations of a plant or facility, or a processing activity, or to collect data 
for further analysis. 
 
Note: Real property inspection services become taxable when the service is provided in 
connection with the repair of real property. 
 
 
M. CONSULTING AND SUPERVISING SERVICES 
 
The application of PST to consulting and supervision services will depend on the nature of the 
services as follows: 
 
• PST applies to charges for consulting and supervision when the duties directly relate to 
overseeing or assisting with the completion of taxable services, such as those outlined in 
Section C
. 
• Consulting and supervision services that relate to an exempt or non-taxable service, such as 
those outlined in Section L, are not subject to PST. 
 
 
N. CONTRACTORS WHO MAKE RETAIL SALES 
 
A contractor who makes supply only sales must collect tax from the customer on the retail selling 
price of the items sold and show PST collected on the customer’s invoice. The contractor may 
purchase the materials exempt from PST by quoting their vendor’s licence number to their 
suppliers.

--- Page 8 ---
- 8 - 
saskatchewan.ca 
 
O. CASUAL RENTALS 
 
Contractors who occasionally rent out their equipment must collect tax on the rental charge. A 
contractor who uses their equipment to provide services is the user or consumer of the equipment, 
and is not providing an equipment rental. The contractor must collect the PST on the total charge 
to the customer for their services in either situation, and the contractor must pay PST on the 
purchase or lease of their equipment that is not part of an inventory of exempt rental equipment.  
 
 
P. SERVICES TO REAL PROPERTY ON INDIAN RESERVES 
 
Services to real property provided to Status Indians, Indian bands and non-commercial  
band-empowered entities are exempt from PST providing the services are performed on the 
reserve. To qualify for the exemption, an individual must present their Certificate of Indian Status 
card to the supplier/contractor, and the complete 10-digit card number must be recorded on the 
sales invoice. For an Indian band or non-commercial band-empowered entity, the band number 
and band name must be recorded on the sales invoice. A band-empowered entity must also 
certify that the purchase is for non-commercial band-management activities. The service provider 
must retain evidence that the services were performed on reserve. Please see Information 
Bulletin PST-63, Sales to First Nations Individuals and Organizations for further information. 
 
 
Q. BONDING AND CLEARANCE PROCESS AND ENSURING CONTRACTOR HOLDS A VALID LICENSE 
 
1. Bonding/Clearance Requirement when Hiring Contractors 
 
Under Section 29 of The Provincial Sales Tax Act, non-resident contractors consuming or using 
equipment or other goods during the completion of a contract in Saskatchewan are required to: 
 
a) post a Guarantee Bond or cash deposit in an amount equivalent to 6% of the total 
contract amount, or 
b) obtain a clearance letter from the Ministry of Finance to provide to the principal. 
 
It is recommended that the principal maintain a holdback of 6% until a clearance letter is 
provided or proof of bonding is obtained. 
 
It is the responsibility of the principal to ensure that contractors comply with this provision as 
failure to do so can leave the principal liable for any taxes which the contractor fails to remit, 
in addition to possible fines and penalties. 
 
Proof of Guarantee Bond 
 
In the majority of cases, bonding is obtained prior to work commencing. Original bonds are 
to be forwarded to the Revenue Division and written confirmation will be provided upon 
receipt.  
 
If proof of bonding has been obtained, the principal is not required to also maintain holdbacks 
for PST purposes. However, in the event that change orders are subsequently issued which 
increase the total contract value, a holdback must be maintained on those change orders or a 
bond rider must be obtained.

--- Page 9 ---
- 9 - 
saskatchewan.ca 
 
Clearance Letter on Final Payment 
 
In cases where proof of bonding has not been obtained, before the final payment is made on a 
contract, the contractor must obtain a clearance letter from the Revenue Division and provide 
a copy of the letter to the general contractor or principal. To obtain a clearance letter, please: 
 
• Visit our website at saskatchewan.ca/pst, or 
• Call 1-800-667-6102, extension 0956, or 
• Email contractorclearance@gov.sk.ca. 
 
If the contractor does not pay the PST payable with respect to the contract, the general 
contractor or principal will be requested to withhold from any hold back an amount equal to 
the tax due, to a maximum of 6% of the contract amount, and remit this amount to the 
Revenue Division. 
 
Generally, a clearance letter covers a specific contract for a specific customer. However,  
non-residents contracted for Master Service Agreements or similar arrangements are 
encouraged to request clearances on a monthly basis covering all jobs per customer within 
that month, versus on a job-by-job basis. For larger contracts spanning over a period of 
several months or years, a clearance may be requested for each progress period. 
 
2. Principal’s Obligation to Ensure Contractor Holds a Valid Licence 
 
Section 29.01 of The Provincial Sales Tax Act requires the principal to ensure a contractor 
holds a valid Saskatchewan PST vendor’s licence, whether the contractor is a resident or a 
non-resident, before making payment of PST to the contractor. 
 
The principal can verify that a contractor holds a valid PST vendor licence by accessing the 
PST On-Line Registry at sets.saskatchewan.ca/rptp/portal/footer/pst-registry
/. It is 
recommended that the principal maintain a print from the registry for audit purposes.  
 
Alternatively, a clearance letter for the contract would act as sufficient evidence that the 
contractor holds a valid licence. 
 
 
R. GOODS AND SERVICES FOR YOUR OWN USE 
 
Businesses are required to pay tax on purchases of new and used equipment, supplies and 
taxable services purchased for use in their business operations. Tax is payable as follows: 
 
• When purchased from a licensed supplier, the tax must be paid to the supplier at the time of 
purchase. 
• When purchased from a supplier who did not collect the tax, or when taken from an exempt 
resale inventory, the tax must be self-assessed and remitted with the regular tax return. This 
includes goods taken for personal or business use. 
• When purchased from an unlicensed supplier located outside Saskatchewan, the tax must be 
self-assessed and remitted with the regular tax return on the laid down cost, which includes 
currency exchange, transportation charges, customs and excise duties, and importation 
charges, but not the GST.

--- Page 10 ---
- 10 - 
saskatchewan.ca 
 
S. SALE OF USED BUSINESS ASSETS 
 
Businesses are required to collect tax on the sale of used assets, such as taxable vehicles and 
equipment. When used assets are being sold as part of the closure of a business, the purchaser is 
required to self-assess and report the tax. 
 
When individuals purchase used goods for personal use, other than vehicles, tax applies to the 
selling price of the goods less a deduction of $300 per item. If a trade-in is involved, the 
purchaser is entitled to a deduction of $300 or the value of the trade-in, whichever is greater. If 
the goods are for commercial use, the $300 deduction does not apply. 
 
For further information please see Information Bulletin PST-58, Used Goods. 
 
 
T. TAX TIPS LINE 
 
When a business or individual does not comply with provincial tax legislation, businesses face 
unfair competition and a burden is placed on all taxpayers who do comply. It causes significant 
loss in the revenue available to fund services such as health, education and other important 
government programs. 
 
Tax Tips Line provides an anonymous, fully confidential way for the public to report businesses or 
individuals who are participating in tax fraud. If you suspect that a business or individual is being 
dishonest with their provincial taxes or is misrepresenting their activities to reduce their taxes, 
you can report them using Tax Tips Line. 
 
Please visit our website at 
saskatchewan.ca/business/taxes-licensing-and-reporting/provincial-
taxes-policies-and-bulletins/tax-tips-line t o find out more regarding types of tax fraud and the 
information to report, if possible. 
 
Tax Tips Line is specifically and solely for information related to provincial tax compliance. Any 
unrelated inquiries or information will not be addressed by the Tax Tips Line, and should be 
directed to the appropriate organization. 
 
How to Report: 
1) Toll-free 1-833-334-8477 
2) Write: Ministry of Finance 
  Revenue Division 
           PO Box 200 
           REGINA SK S4P 2Z6 
3) Online Form Submission

--- Page 11 ---
- 11 - 
saskatchewan.ca 
 
U. SASKATCHEWAN eTAX SERVICES (SETS) 
 
Finance has made it possible to report and remit tax electronically through a secure, fast, easy 
and convenient online self-service portal. Several services are currently available to businesses 
through SETS (sets.saskatchewan.ca
): 
 
• Register for secure, self-managed access to all your tax accounts. 
• Apply for a new tax account. 
• File and pay returns and amend previously filed returns. 
• Make payments on account, including post-dated payments. 
• View account balance and statement information. 
• Authorize employees or accountants to file on your behalf. 
• Receive notifications by email when a tax return should be filed. This replaces the paper 
forms usually sent in the mail. 
• Submit a service request to update the mailing address or add a new business location. 
• Submit a service request to receive tax information, interpretations or rulings related to your 
specific business activities. 
• View and download up-to-date tax information promptly. 
• Subscribe to receive email notifications when new and revised tax publications are available. 
 
 
FOR FURTHER INFORMATION 
 
Write: Ministry of Finance Telephone: Toll Free 1-800-667-6102 
 Revenue Division  Regina    306-787-6645 
 PO Box 200 
 REGINA SK S4P 2Z6 Email: sasktaxinfo@gov.sk.ca 
  
Internet:  Tax bulletins, forms and information are available at saskatchewan.ca/business-taxes
. 
 
To receive automatic email notifications when this or any other bulletin is revised, go to 
sets.saskatchewan.ca/subscribe
. 
 
To provide feedback or suggest changes to this bulletin, please complete a Bulletin Survey
. 
 
  Government website: Saskatchewan.ca
