Every business in Canada with gross revenues greater than $30,000 must register for a goods and services tax number (GST), according to the Canada Revenue Agency, the national taxing agency. The Business Development Centre, a Canadian business registration and incorporation business, advises that every business in the country, even those making less than $30,000, should also register for a GST number. GST is a 5 percent national sales tax applied to nearly all goods and services sold in Canada. Almost everyone in the country has to pay GST on goods and services, and nearly all business need to collect the tax on behalf of the government. There is no charge to apply for the number.
Take the survey offered by the Canada Revenue Agency to determine if you need to apply for a GST/HST number. The HST is the harmonized sales tax, which varies in Canada’s different provinces from 12 percent in British Columbia to 15 percent in Nova Scotia. The HST is composed of the 5 percent GST and an additional percentage of tax added in the various provinces. The CRA notes that you also may need a GST/HST number if you plan to sell the goods in Canada or export them outside the country.
Determine if you provide goods or services exempt from the GST/HST. Those include residential housing, health care and dental services; certain child care services; and many educational services, according to the CRA. The specifications for exempt goods and services are varied, so click the “Residential Housing” link or the “Exempt” goods and services link in the second window of the CRA survey to determine if your products or services qualify for exemption. The survey will also ask you if your taxable sales exceed $30,000 in a calendar quarter or calendar year. If you don’t sell exempt goods or services and your sales exceed $30,000, you must apply for a GST/HST account.
Examine the GST/HST registration checklist on the CRA website. The checklist asks you to determine the structure of your business or organization, such as sole proprietorship, partnership, limited liability partnership, corporation, joint venture, charity or nonprofit organization. Most charities are exempt, but there are exceptions, so check the CRA website. Exempt organizations can opt to do a voluntary registration for a GST/HST number. The checklist will also help you report and claim tax credits, determine how often you need to file GST/HST returns, determine how to authorize a non-employee representative to be a contact person — by filing RC59, Business Consent Form — and how to have tax credits and refunds deposited directly into your bank account — by filling out Form GST469, Direct Deposit Request.
Download and print the Request for Business Number form to apply by mail. List the structure of your business on the form, as well as your Social Insurance number, or SIN. Fill out the business address, business activities and the products you sell. Boxes on the form will ask you to list your revenues, either annually, quarterly or monthly; number of employees; whether you are a taxi or limousine service — in which case you have to register for the GST/HST regardless of your revenue — and whether you are a nonresident of Canada.
Call the CRA at 1-800-959-5525 to register by phone. The service provides recorded information 24 hours, but to register for a GST/HST number, call an agent at the number between 8:15 a.m. and 8 p.m. Monday through Friday. The agent will take you through the same steps and questions listed on the Request for Business Number form. Agents are also available some Saturdays. Call to check for days and hours. Register online by filling out a Business Registration Online form, by clicking the link near the bottom of the GST/HST registration checklist. The link will take you through a series of Web pages asking you to supply the same information requested on the Request for Business Number form.