Do you need to charge GST/HST?
Most small businesses must register once their sales pass $30,000. Some register sooner, because it lets them claim back the GST/HST they pay.
The $30,000 rule
The CRA calls a business under the limit a small supplier. You stay a small supplier while your taxable sales (before tax) are $30,000 or less in a single calendar quarter and over the last four calendar quarters together. Once you go over, you have to register for a GST/HST number and start charging it.
Add up all your businesses together when you check: a farm and a trade run by the same person count as one total.
Why some register early
When you're registered, you can claim back the GST/HST you paid on business purchases: tools, fuel, materials, equipment. If you're just starting and buying a lot, registering early can put money back in your pocket. The trade-off is that you must charge GST/HST on your sales and file returns.
What changes when you register
- You charge it. Your invoices show GST, HST, or GST + PST, depending on your province.
- You set it aside. The tax you collect isn't yours. Keep it apart so it's there when the return is due.
- You file returns. Yearly, every three months, or monthly, depending on your sales and what you choose. You pay the difference between what you collected and what you paid.
PST is separate
In British Columbia, Saskatchewan and Manitoba, provincial sales tax (PST) is registered and filed with the province, not the CRA. Quebec has its own sales tax too. In the HST provinces, one tax covers both.
How PeaceBooks helps
Tell PeaceBooks your province and whether you're registered. It uses the right tax and the right words, keeps a running total of what to set aside, and at filing time shows you the number to type on each line of your return.
This is general information to help you keep good records, not tax or legal advice. Your accountant knows your situation; check with them before a big decision.
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