The Goods and service Tax Online Registration in India and Services Tax or GST is a consumption tax with this increasing charged on most goods and services sold within Canada, regardless of where your business is situated. Subject to certain exceptions, all businesses are required to charge GST, currently at 5%, plus applicable provincial sales taxation’s. A business effectively acts as an agent for Revenue Canada by collecting the required taxes and remitting them on a periodic basis. Businesses additionally permitted to claim the taxes paid on expenses incurred that relate to their business activities. These are referred to as Input Tax Snack bars.
Does Your Business Need to Register?
Prior to engaging in any kind of commercial activity in Canada, all business owners need to see how the GST and relevant provincial taxes apply to both of them. Essentially, all businesses that sell goods and services in Canada, for profit, have to charge GST, except in the following circumstances:
Estimated sales for that business for 4 consecutive calendar quarters is expected to get less than $30,000. Revenue Canada views these businesses as small suppliers usually therefore exempt.
The business activity is GST exempt. Exempt goods and services includes residential land and property, child care services, most health and medical services etc.
Although a small supplier, i.e. a business with annual sales less than $30,000 is not must file for GST, in some cases it is beneficial to do so. Since a business could only claim Input Breaks (GST paid on expenses) if they are registered, many businesses, particularly in the start up phase where expenses exceed sales, may find that they are able to recover a significant involving taxes. This ought to balanced against the opportunity competitive advantage achieved from not charging the GST, and the additional administrative costs (hassle) from needing to file returns.