Filing for Goods and Services Tax (GST) and Harmonized Sales Tax (HST) is often confusing for small business owners. It is important to understand when your business must charge GST/HST, in addition to all regulatory filings, reporting, and remitting requirements. Failing to meet tax deadlines may result in late penalties.
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GST/HST Registration & Filing
All businesses with revenues over $30,000 in in any single calendar quarter and in the last four consecutive calendar quarters must register for GST/HST and file a GST/HST return even if there is no tax to remit.
If you don’t file your GST/HST return by the return’s due date (monthly, quarterly, or annually), the CRA will begin charging penalties and interest on any returns or amounts that they have not received. This can cause unnecessary costs and headaches to new and small businesses.
Filing Frequency
There are three levels of filing frequency depending on the amount of your taxable sales.
|
Annual Taxable Sales |
Filing Frequency |
|---|---|
|
$1,500,000 or less |
Annual (quarterly or monthly are optional) |
|
$1,500,001 – $6,000,000 |
Quarterly (monthly is optional) |
|
Over $6,000,000 |
Monthly |
Type and Place of Supply
In order to know which GST/HST rate to apply, you have to determine what type of goods or services you’re selling, and the place they are supplied.
Some items, such as groceries and agricultural or fishery supplies, are zero rated and no GST/HST is charged in Canada. Other items are exempt, including long-term residential rentals and most health, medical, dental, child care, and educational services. For exempt services, it may be possible to claim input tax credits for any GST/HST paid. Additionally, certain organizations, such as charities or municipalities, may be exempt from charging GST/HST. Most other goods or services are taxable.
For detailed information on GST/HST classification of various goods and services, visit the Government of Canada.
GST/HST Rates for Taxable Supplies
Once the type of goods and services and the place of supply are defined, the applicable GST/HST rates can be determined.
| Place of Supply | Rate | Type |
|---|---|---|
|
Alberta, Nunavit, Northwest Territories, Yukon |
5% | GST Only |
|
British Columbia Note 1 |
12% | GST + PST |
|
Manitoba Note 1 |
13% | GST + PST |
|
Ontario |
8% | HST |
|
New Brunswick |
10% | HST |
|
Newfoundland and Labrador |
10% | HST |
|
Nova Scotia |
10% | HST |
|
Prince Edward Island |
10% | HST |
|
Quebec Note 2 |
14.975% | GST + QST |
|
Saskatchewan Note 3 |
11% | GST + PST |
- You are required to register with these provinces, collect the PST, and file PST returns.
- If you are a non-resident of Quebec and have no physical presence or employees there, you are exempt from registering for, and filing, QST.
- The requirement to register and remit PST is optional in Saskatchewan but, if you choose not to register, the customer is required to pay the PST.
Relieve Your GST/HST Stresses
Included in our bookkeeping packages is the accurate preparation and filing of your GST/HST returns, whether you need to file monthly, quarterly, or annually. We ensure you are in full compliance with current legislation. Contact us today to sign up for one of our packages, and let us handle all your bookkeeping headaches so you can breathe easy.
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