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Do I have to register for the GST?

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Do I have to register for the GST?

Most Businesses Need to Collect/Remit GST/HST

Image (c) John Lamb / Getty Images

Question: Do I have to register for the GST (Goods and Services Tax)?

Answer:

Most businesses are required to register for the GST (and collect and remit the GST or HST).

However, if your business qualifies as a Small Supplier, then you are not required to register for the GST/HST.

The Canada Revenue Agency defines a GST Small Supplier as a sole proprietor, partnership, or corporation whose total taxable revenues before expenses are $30,000 or less annually. (Read the complete Small Supplier definition.) Note that provincial sales taxes or proceeds from the sale of capital property are not included in the threshold amount. Note also that the Small Supplier GST registration rule doesn't apply to all types of businesses; taxi and limousine operators, for instance, must always register for the GST.

But even if your business does qualify as a GST Small Supplier, you will probably want to register for the GST anyway. If you register for the GST/HST, you can them "reclaim" the GST/HST you've paid on business purchases, on everything from capital property through office supplies, through GST/HST Input Tax Credits. Therefore, it's wise to register for the GST right away when you're starting a business.

See Grappling With The GST and/or HST for a fuller explanation of the Small Supplier GST exemption and how GST Input Tax Credits work. For current GST/HST/PST rates in the various provinces and territories see Sales Tax Rates for GST, HST, PST in Canada.

 

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