What is Sales Tax/GST?
Goods & Service Tax
A tax that applies to most goods and services made in Canada.
- For a list of Exempt goods & services, please check the CRA website.
When should I register for a GST number?
Once your busines has reached sales of $30,000 or greater in ANY four consecutive quarters you are required to register for a GST number.
Let’s be honest, not many small business owners make $30,000 as soon as their business launches. Here’s my word of advice, register for a GST immediately! WHY? Are you wanting to market yourself as a professional in your industry? If you answered Yes, which I’m assuming you did! Register for a GST number; this will set your apart from your competition, you’ll look more professional and in turn, make more sales. PS: I’ll show you how this will save you money too! More on this in a sec…
Depending on what Province or Territory you operate your business, you are required to collect; GST, PST, HST or a combination.
How do I calculate GST?
Here’s an example of the same $100 good or service being sold in three different provinces:
| Good/Service | GST | HST | PST | Total Invoice | |
| Alberta | $100.00 | $5.00 | $0 | $0 | $105.00 |
| Nova Scotia | $100.00 | $0 | $15.00 | $0 | $115.00 |
| Manitoba | $100.00 | $5.00 | $0 | $7.00 | $112.00 |
*This example is given August 2020, always check with the CRA & your province on up to date Sales Tax info.
What are Input Tax Credits? Commonly known as ITC’s
You can recover the GST you pay on purchases and expenses related to your business in the form of ITC’s. ITC’s are then counted against the sales tax that you collected.
Example:
Sales Tax Collected: $1489.00
Sales Tax Paid: $232.00
Total Remittance: $1257.00
When do I remit my Sales Tax to the CRA?
Your remittance schedule is typically based on your annual revenue.
<$1.5M Report Annually
$1.5M-$6M Report Quarterly
>$6M Report Monthly
How do I submit my GST Remittance to the CRA?
- Online
- Financial Institution
Choose what works for you & your business; as a small business owner, I’m looking for ways to work smarter NOT harder. With technology, I find the most time saving way to remit sales tax, is online through the CRA website, set up your banking information once and it’s ready for your every time you remit your GST.
