Q: I’m a plumber earning less than $30,000 per year. In order to bid on jobs I found I needed to have a GST-HST number, so I registered two years ago. But since then, I haven’t earned over $30,000 per year. Do I still have to charge GST-HST? Do I have to file returns?
A: Yes. Once you register for a GST-HST number, you must charge GST-HST on all your self-employment earnings when billing Canadian payers.
The $30,000 threshold is called the Small Supplier Threshold. If you earn less than $30,000 in four consecutive calendar quarters (i.e., in a year’s time), you fall below the threshold. Being below the threshold means you are not obliged to register for the GST-HST.
However, you can still choose to register, despite being a small supplier.
Obligations for GST-HST registrants
And once you register, regardless of your revenue or freelance earnings going forward, you take on all the obligations of being a GST/HST registrant:
- You must charge GST-HST to Canadian payers on all your self-employment income;
- You must remit to the government all the GST-HST you collect [less Input tax credits]; and
- You must file GST-HST returns regularly
So even though you didn’t have to register for the GST-HST and your earnings still fall below the small supplier threshold, having done so you must fulfill your obligations as a GST-HST registrant.
What if CRA sends you a bill?
If you fail to file returns and remit GST-HST, CRA will eventually contact you to demand those returns, or to demand a remittance based on a number they basically make up. Often the amount of GST-HST they request is too high. The only way to bring it down and to get out of trouble is to go back and file the required returns and remit the GST/HST calculated on those returns.
Not to worry. Personal Tax Advisors has helped countless Canadians file their overdue GST-HST returns, minimize the amount of GST-HST owing, and obtain an income tax refund in the process.
Contact us today to discuss how we can get you back on CRA’s good side.
I’m a new small business since Jan 2024 I pay my gst every 4 months but I did not make 30.000 do I got to submit the GST charge a total of $750 in GST for the first four months
All the GST/HST you collect is a tax you’re collecting on behalf of the government. CRA considers it to be money you hold in trust for them — it belongs to them, not you. So any GST/HST you collect does have to be remitted. And you also need to keep filing regular GST/HST returns for as long as you remain registered.
Do you need a gst hst number to charge gst?
Yes, you do.
If I wait to register until the 30,000.00 mark can I still claim the Gst I paid on purchases?
Generally you can only claim back the ITCs on purchases made after your date of registration. If you have capital assets (computers, furniture, etc) that you purchased before you registered, you may be able to claim back partial ITCs based on how much value is still left in them at the time of registration. Hey! I should make a post/video about that. Grab a free copy of my GST-HST Primer and subscribe to my tax tips mailing list to know when I put it out 🙂
That’s what I figured thank you for the confirmation