If you sell taxable goods or services in Canada, GST/HST registration is a question you will face sooner or later. In simple terms, you generally must register once your taxable sales pass $30,000 in any 12-month period. You can also choose to register earlier in some cases, and that choice can matter for input tax credits.
What is the $30,000 threshold?
The $30,000 threshold looks at taxable sales over any 12-month period, not only a calendar year. Once you cross it, registration is no longer optional. That is why it helps to track sales on a rolling basis, especially if your business is growing or has a busy season.
Not every sale counts in the same way. For example, sales of exempt goods or services are treated differently from taxable sales. If you are unsure whether your sales are taxable, check before you assume you are below the threshold.
When should you register?
- You must register when your taxable sales exceed $30,000 in any 12-month period.
- You may register voluntarily before reaching the threshold, which can allow you to claim input tax credits on business purchases.
- Timing matters: once you are required to register, do not wait for a reminder. Register promptly and start charging tax from the right date.
Voluntary registration is not right for everyone. It can help when you have significant taxable business purchases, because input tax credits can offset the tax you pay on those purchases. It can also add filing and record-keeping work, so it is worth a careful review of your sales and expenses before you decide.
How GST/HST filing works
After registration, you charge GST or HST on taxable sales, keep records of the tax you collect, and file a return for each reporting period. The return reports the tax collected, less the input tax credits you can claim, and the difference is either paid to the CRA or refunded.
Input tax credits are a key reason to keep clean records. Without invoices and receipts that support your claims, you may not be able to claim credits you expected. That is why record-keeping is not just an administrative task; it directly affects the tax you pay.
For corporations, GST/HST filings sit alongside the T2 return, so our corporate tax filing services in Canada can keep both in step and avoid a year-end scramble.
Records to keep
- Sales invoices showing tax charged.
- Purchase invoices and receipts showing tax paid.
- Bank and credit card statements that support your records.
- Notes explaining any unusual or mixed-use expenses.
Provincial differences to know
Canada does not use one rate everywhere. The federal GST rate is 5%. Some provinces use HST, which combines the federal and provincial taxes into one rate. Others use GST plus a separate provincial tax.
- GST: 5% federal, including in Alberta, where there is 5% GST only.
- HST: Ontario 13%; New Brunswick, Nova Scotia, Newfoundland and Labrador, and Prince Edward Island 15%.
- PST: British Columbia 7%, Saskatchewan 6%, Manitoba 7%.
- QST: Quebec 9.975%.
The rate you charge can depend on where the sale is made and the type of supply, so do not assume the rate in your home province applies everywhere. If you sell across provinces, check the place-of-supply rules for your type of sale.
Common mistakes to avoid
- Waiting too long after crossing the $30,000 threshold.
- Charging the wrong provincial rate.
- Claiming input tax credits without supporting invoices.
- Mixing personal and business purchases in the same records.
- Leaving filing until the deadline, when records are hardest to find.
Related reading from ABS
Corporate Tax Filing (T2) in Canada: Deadlines, Rates, and Filing
The T2 return is generally due six months after your fiscal year-end.
Read more →
Bookkeeping for Small Businesses in Canada: A Practical Guide
Monthly bookkeeping turns tax time from a stressful search through old paperwork into a routine check.
Read more →Talk to ABS about GST/HST
ABS offers business, GST, and personal tax services across Canada, with a CPA-certified team and Canada-wide virtual service. If you are near the threshold, already registered, or unsure whether you need to register, contact ABS to book a free 15-minute consultation. You can also read about our Accounting & Bookkeeping services if your records need a tidy-up first.