What Is A Filing Period?
Your GST/HST filing period determines how often you must file a GST/HST return. Unlike income tax returns (which always have an annual filing period with a set year-end and filing deadline), GST/HST registrants usually have several options.
For businesses earning annual revenues of $1.5 million or less the default filing period is quarterly and the default year-end is December 31. This means that if the registrant doesn’t specify, they will be automatically assigned a filing period that requires a return every three months, four times per year.
However these registrants also have the option to file annually and/or select a different fiscal year-end. For many, annual filing is the better option.
Extended Annual Filing Period
If the business is a sole proprietorship (as opposed to a partnership or corporation) opting for annual filing and a December 31 year end, Canada Revenue Agency (CRA) typically grants an extended deadline for filing their GST/HST returns called an Extended Annual Filing Period.
Under this option, each GST/HST return covers one calendar year ending on December 31, and is due on June 15. (Without the extension, the filing deadline would be March 31.)
This deadline extension to June 15 is convenient as it lines up cleanly with a person’s income tax return: both returns cover the same Jan 1 – Dec 31 period, and both are due on the same date.
Remitting More Than Once A Year
At its most basic, GST/HST is a tax collected from your customers and ultimately remitted to CRA. Some GST/HST registrants feel uncomfortable letting the GST/HST they’ve collected ‘pile up’ for too long before remitting it to CRA.
However, that doesn’t mean they need to accept a quarterly filing period. They can still opt for an annual filing period but choose to make instalment payments in advance.
Choosing Or Changing Your Filing Period
Registrants are asked for their preferred filing period when they first set up their GST/HST account. If they don’t specify, the default is used (i.e., quarterly filing for businesses earning under $1.5 million per year).
If you would prefer to file returns less often and your revenue period allows it, you can request a change. However, you will typically be required to finish out the year using the current filing period before a change can be effected. If you make the request in the first quarter of the year (i.e., before March 31), you may be allowed to change your filing period retroactively to January 1.
How Personal Tax Advisors Can Help
Personal Tax Advisors can help you fulfill your GST/HST registration obligations. Our income tax preparation service for self-employed people includes the preparation and filing of a GST/HST return. If you file annually, that will comprise your entire tax filing obligation for the year.