For animals: you can use "it" or "he" or "she" freely. I usually say it, unless I know the gender of the animal. People usually just guess the genders of dogs (often assuming it is male). Here is an example of a fairly common exchange you might hear here: Person 1: Your dog is very cute. What's his name? Person 2: Actually, it's a she. Her name is Molly. For inanimate objects the usage of personal pronouns (he/she) is limited to things that look like people or animals (dolls, stuff animals, etc), ships (rarely these days), and poetic language.

For animals, you can use ‘it’ depending on the context. For pets we normally use ‘he’ or ‘she’ and know the gender. If we don’t, there are several possibilities: guess the gender and expect that we might be corrected, use ‘they’, don’t use a pronoun. I see a coyote every night when I go for a walk. It scares me. Your dog is so cute! A: She’s so cute! What’s her breed? B: Thanks. He’s a mutt. I don’t know. There’s a dog keeping me awake. They’re really loud.

You usually use the words "he, she, they" when you're referring to an animate thing. There can be exceptions like if you're talking to a child who has a doll, and you refer to the doll as "she/her" because that's how the child is. But, usually, if it's an inanimate object people go with "it/that". Also, native speakers don't really know the gender of people's pets at all. I've noticed (slightly) older generations of English speakers tend to guess the animal's gender, whereas younger ones tend to instinctively say "they". For example, "Oh! They're really cute!". Plural pronouns have a long history of becoming/being used as singular in the English language. (It's why one says "you are" and not "you is" in most standardized forms of English. "You" used to be plural also.)