Do I need to register for a GST/HST number?

What is HST?

HST, or harmonized sales tax, is a sales tax applied in certain provinces. It’s a combination of the GST and the province’s provincial sales tax (PST). However, Not all provinces have HST; . Ssome charge GST and PST separately, while others charge only GST..

Where is HST Charged in Canada?

HST applies in five of Canada’s provinces:

Ontario—:13%;, Prince Edward Island, Newfoudland/Labrador, New Bruinswick and Nova Scotia - :15 %

Alberta, Northwest Territories, Nunavut:- only GST at 5 %

Quebec:- GST- 5% and QST- 9.975 %

Other Provinces:- GST and PST

When do I have to register?

If you’re a business owner in one of these provinces and your annual sales/ or income are/is $30,000 or more, you must register for GST/HST. Once you have a GST/ HST number, you collect the GST/HST and remit it to the CRA based on your reporting period.[(we suggest reporting- annually]). You can claim GST/HST paid on expenses , known as Input Tax Credit (ITC), and pay the difference.

Consecutive calendar quarters need not be in the same calendar year. For example, If your gross income was $20,000 in December and went down to $10,000 in January of the next year, you have crossed the threshold and need to register immediately.

Taxi /Uber Drivers

If you are a self-employed taxi driver or a commercial ride-sharing driver (e.g., Uber driver), you must register for a GST/ HST number from the date you start your business.

Zero-rated/ Exempt sales/services

There are some businesses with zero-rated sales-tax (e.g., basic groceries and certain medical devices or exempt products/services such as legal aid services, music lessons, child care services or financial services). Zero rated services can register for a GST/ HST number. They do not collect GST/HST, but they can still register for GST/HST if their income is less than $30,000. They pay GST/HST on expenses and claim them as input tax credit, resulting in a refund situation.

Businesses under the exempt category can not claim GST/HST paid on goods/services and thus are, not required to register.

How to register?

You can call the CRA’s business inquiries number- 1 800 959 5525 to register for GST/HST. However, it is suggested to contact a professional at Softron Tax for better guidance on what to do after registration is done.