HST - Harmonized Sales Tax

Harmonized Sales Tax, commonly referred to as HST, is a consumer tax resulting from the combination of the Canadian Goods and Services Tax (GST) and Provincial sales tax (PST). The GST Goods and Services Tax is applicable in some Provinces where the Provincial and Goods taxes remain separate instead of operating as one unit such as in Ontario through HST.

Province HST/GST Tax
Alberta 5%
British Columbia 5%
Manitoba 5%
New Brunswick 15%
Newfoundland & Labrador 15%
Northwest Territories 5%
Nova Scotia 15%
Nunavut 5%
Ontario 13%
Quebec 5%
Prince Edward Island 15%
Saskatchewan 5%
Yukon 5%

As a business owner, when a business earns more than $30,000.00 per year it is a requirement for you to apply and obtain an HST tax number. It becomes your responsibility to charge, collect and remit Harmonized Sales Tax as required from your customers or clients. You are able to select a monthly, quarterly or annual reporting and filing period. As with the GST/HST, there is a small supplier exception; if your small business makes less than $30,000 annually, you are not required to register for GST/HST. You may, if you wish, voluntarily apply.

harmonized sales taxOnce your business earns more than $30,000.00 in revenues, you are no longer considered a small supplier to Canada Revenue Agency and must apply for an HST account. The HST is counted from the day you apply to set up your HST account moving forward.

If you are registering or have an existing Proprietorship or Sole Proprietorship, include the gross amount of revenues for the business before expenses from your global taxable supplies from all of the businesses and those of your associates.

If you are registering or have an existing General Partnership, Partnership or Corporation include the gross amount of revenues for the business including zero rated supplies of any property within or outside of Canada. Expenses of capital properties, financial services and goodwill from the sale of a business are not to be included.

If you are a charity or public institution you are not required to set up an HST account until you either have $250,000 in gross revenues or $50,000 in taxable expenses. When you reach either of these thresholds, the HST set up must be completed with the Canada Revenue Agency.

If you are a non-resident of Canada but operate a business within Canada, a Form RC1 is applicable where you can request for a business number. In this circumstance, it is best to contact the Canada Revenue Agency to determine requirements specific to your situation.

Registering HST/GST with Ontario Business Central

We can assist you to apply for HST tax number as part of your business set up. Whether you are incorporating or registering a Proprietorship, Sole Proprietorship, Partnership or General Partnership, Ontario Business Central offers the ability for us to obtain the HST Tax number on your behalf.

Our fees to set up HST for your new business are:
Incorporated Business $49.99
Registered Business $39.99

The HST registration with our office is completed within 1 to 2 days after we complete the incorporation or registration on your behalf.

How do you Remit your HST to CRA Canada Revenue Agency?

Once you have set up the HST account, it is now your responsibility to file with CRA on whatever time frame is established. Most businesses pay HST quarterly however some pay monthly and others pay yearly. The yearly filing requires you to be very vigilant in maintaining records and funds to pay a yearly installment. It is important that you maintain current records with CRA and provide the installment on time. If you do not, there may be penalties and interest accrued.

Once the HST set up has been completed, you can apply online with the GST/HST Netfile allowing you the ability to access your tax account online.

Most if not all financial institutions in Canada have the availability to pay tax instalments directly from your bank account through a portal with Canada Revenue Agency.

Registering with Canada Revenue Agency

If you wish to complete this item yourself, once the business has been established, you may contact CRA Canada Revenue Agency and obtain the HST tax number for your business directly at no cost to you.

If you wish to set up the HST yourself, here is Revenue Canada’s website for HST information and registration.

Visit Revenue Canada’s website for HST information and registration.