If you run a business in Ontario, you may need to register for the Harmonized Sales Tax (HST). This tax combines the federal Goods and Services Tax (GST) and the provincial sales tax into one. In Ontario, the HST rate is 13%. Registering for HST is important for businesses that sell taxable goods or services.
Quick Key Points on Registering for HST in Ontario
- Determine if you need to register.
- Understand the HST rate.
- Gather necessary information.
- Register online through Business Registration Online (BRO)
- Know your obligations post-registration
Let’s walk through the details of the process together.
Who Needs to Register for HST?
You must register for HST if your business makes taxable sales, leases, or other supplies in Canada and your total revenue exceeds $30,000 over four consecutive calendar quarters.
Even if your revenue is below this threshold, you may choose to register voluntarily. This can allow you to claim input tax credits (ITCs) for the GST/HST you pay on business expenses.
Understanding Input Tax Credits (ITCs)
Input Tax Credits (ITCs) allow you to recover the GST/HST paid on purchases and expenses related to your commercial activities. To claim ITCs, you must:
- Be a GST/HST registrant.
- Have valid documentation, such as invoices or receipts, showing the GST/HST paid.
- Use the goods or services in your commercial activities.
Proper record-keeping is essential to support your ITC claims.
Understanding Taxable Supplies
Taxable supplies are goods and services that are subject to GST/HST. This includes most goods and services sold in Canada, such as clothing, electronics, and consulting services. Some supplies are zero-rated (taxed at 0%), like basic groceries and certain medical devices. Others are exempt, such as most health and dental services.
If your business provides taxable supplies, you need to consider HST registration.
2 Simple Steps to Register for HST
1. Obtain a Business Number (BN)
Before registering for HST, you need a Business Number (BN) from the Canada Revenue Agency (CRA). This is a unique 9-digit number that identifies your business.
You can register for a BN online through the Business Registration Online (BRO) service.
2. Register for a GST/HST Account
Once you have a BN, you can register for a GST/HST account through the same BRO service.
During registration, you’ll need to provide:
The effective date of registration (usually the date you exceed the $30,000 threshold or the date you choose to register voluntarily).
Your fiscal year for GST/HST purposes (often the same as your income tax year).
Total annual revenue (an estimate if you’re a new business)
After Registration
Once registered, you must:
- Charge and collect HST on your taxable supplies.
- File GST/HST returns regularly.
- Remit the HST collected to the CRA.
You can also claim input tax credits (ITCs) to recover the GST/HST paid on business purchases and expenses.
Filing and Remittance
You can file your GST/HST returns online using the CRA’s GST/HST NETFILE service. This service allows you to submit your returns and make payments electronically.
Ensure you file your returns and remit any amounts owing by the due dates to avoid penalties and interest.
Voluntary Registration
If you’re a small supplier (with revenue under $30,000), you can still choose to register for HST voluntarily. This allows you to:
- Claim input tax credits for the GST/HST paid on business expenses.
- Enhance your business’s credibility with customers and suppliers.
However, once registered, you must comply with all GST/HST obligations, including charging HST and filing returns.
Charging and Collecting GST/HST
Once registered, you are required to charge GST/HST on your taxable supplies. In Ontario, the HST rate is 13%. It’s important to determine the correct rate to charge based on the province where the supply is made. For instance, Nova Scotia’s HST rate will decrease to 14% effective April 1, 2025.
Ensure that your invoices clearly show the amount of GST/HST charged. This transparency helps your customers understand the tax applied and facilitates accurate record-keeping.
Filing GST/HST Returns
As a registrant, you must file GST/HST returns for each reporting period. Effective January 1, 2024, electronic filing of returns is mandatory for all registrants, except for charities and selected listed financial institutions. The Canada Revenue Agency (CRA) offers several electronic filing options, including:
- GST/HST NETFILE: An online service that allows you to file your return directly.
- My Business Account: A secure portal where you can manage your tax affairs, including filing returns.
- Represent a Client: Allows authorized representatives to file returns on behalf of their clients.
Filing your returns on time is crucial to avoid penalties and interest charges.
Remitting GST/HST Collected
After filing your return, you must remit the net tax owing to the CRA. The net tax is the difference between the GST/HST you collected on your sales and the GST/HST you paid on your business purchases and expenses (input tax credits). If the amount you collected is more than the amount you paid, you remit the difference. If it’s less, you may be eligible for a refund.
Payments can be made electronically through the CRA’s online services or at your financial institution. Ensure that payments are made by the due date to maintain compliance.
Changes to HST in Nova Scotia
It’s important to stay informed about changes in tax rates across provinces. For example, Nova Scotia announced a decrease in its HST rate from 15% to 14%, effective April 1, 2025. This change affects businesses that make taxable supplies in Nova Scotia. Ensure you apply the correct rate based on the date the tax becomes payable.
Conclusion
Registering for HST in Ontario doesn’t have to be confusing. Once you understand who needs to register, how the threshold works, and how to file and remit your taxes, it becomes a regular part of running your business. Whether you’re a new business just starting or you’ve grown past the small supplier limit, staying on top of your GST/HST obligations is an important part of managing your finances and staying compliant with Canadian tax rules.
Need Help With GST/HST Filing?
Contact Bestax today. We help businesses like yours with everything from Ontario HST registration to GST filing, remittance, and compliance. Whether you’re just registering or need help with backlogged filings, we’re here to make the process smooth and stress-free.
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Quick FAQs
What are the requirements for registering for HST in Ontario?
To register for HST in Ontario, your business needs to be making taxable sales, leases, or other taxable supplies in Canada. The key rule is based on how much your business earns. I
Do I need to register for HST in Ontario?
If you’re making taxable supplies and your business crosses the $30,000 HST registration threshold in Ontario, then yes, you need to register.
What documents do I need for GST registration in Ontario?
You don’t need a large stack of documents to complete your GST registration in Ontario. Most people register online, and for that, you’ll just need some basic business details.
When should I register for GST/HST in Ontario?
If your total revenues go over the $30,000 threshold in a single calendar quarter, you must register within 29 days and begin charging GST/HST on the very sale that pushes you over. If you pass the $30,000 mark over a series of quarters, your deadline to register is the first day of the second month following the end of the quarter where you passed the threshold.
Can I register for GST in Ontario online?
The easiest and fastest way to register is online using the CRA’s Business Registration Online (BRO) system. It’s available 24/7, and most businesses will get their Ontario GST/HST number instantly after completing the application.
What is the HST registration threshold in Ontario?
The current HST registration threshold in Ontario is $30,000 in total taxable revenues over four consecutive calendar quarters.
How long does it take to complete HST registration in Ontario?
If you register online, it usually takes just a few minutes. Most businesses receive their GST/HST account number immediately. However, if you apply by mail or through a tax services office, it may take a few weeks. Regardless of the method, you can start collecting HST as soon as you’re registered and receive confirmation of your number.
What if I’m a small business in Ontario? Do I still need to register?
For small businesses in Ontario, HST registration is not mandatory unless you exceed the small supplier threshold. However, many small businesses choose to register voluntarily. This gives them access to input tax credits and can make the business appear more established and trustworthy to clients.
What is the GST registration process like for new businesses in Ontario?
The GST registration process for new businesses in Ontario starts with getting a Business Number. You then register for a GST/HST account using the CRA’s online portal or by calling their business enquiries line.
What is included in a complete HST registration guide for small businesses?
A complete GST/HST registration guide for small businesses would include everything from when to register, how to determine if you’re a small supplier, what to do once you’re registered, and how to collect, file, and remit the tax.
Disclaimer: The information provided in this blog is for general informational purposes only. For professional assistance and advice, please contact experts.
