GST/HST IN CANADA

GST/HST is an indirect tax that is collected from the consumer indirectly by the federal and provincial government/tax administrators. The consumer pays the tax to the seller of goods and services. The seller collects from consumers and pays to federal and provincial government/tax administrators.

GST is the federal sales tax on goods and services and PST is the provincial sales tax that goes to the Provincial Government. HST is the Harmonized sales tax where the Provincial government has agreed to combine the GST and PST. Before the HST was introduced in Canada in 1997, the sales tax in Canada was divided into two parts. One part was federal sales tax, and the second part was provincial sales tax. HST was introduced to combine the two parts together. However, not all provinces have so far adopted this concept.

GST/HST is a major source of revenue for the Federal and Provincial governments of Canada.

GST/HST Registration

Not all your goods or services are taxable under GST/HST. If you are a dentist, most of your medical services are exempt from GST/HST.

You must register for GST/HST when your gross revenue from all your taxable goods or services exceeds $30,000 in four consecutive quarters. You can also register voluntarily even if you have not exceeded your threshold. Once you are registered for GST/HST you must charge GST/HST on all your taxable supplies and state your GST/HST number on the invoice to your customer.

GST/HST rates in Canada

1. N/A - Not applicable
2. Ontario also charges RST (Retail sales tax) 8% insurance and benefits plans and 13% on private sales of a used motor vehicle.
3. P - means participating provinces. The provinces which are not participating, you have to file a separate return for those provinces.

GST/HST return filing and payment deadline in Canada