Reverse GST/HST Calculator for Canada

HST is short for Harmonized Sales Tax, a single sales tax system that harmonizes provincial sales taxes with the GST. It started on April 1, 1997 with Nova Scotia, New Brunswick, and Newfoundland and Labrador. On July 1, 2010, British Columbia and Ontario joined the mix. But in 2013 British Columbia got cold feet and went back to GST/PST, while PEI joined the HST system.

You must register for a GST/HST number as soon as your business crosses $30,000 in revenue over four consecutive calendar quarters. This is really important: once you cross this threshold you must start collecting GST/HST on behalf of the government, and you will be liable for that amount if it isn't collected. Below the threshold, the CRA considers you a "small supplier."

If you need help applying for an HST number, figuring out whether you still qualify as a small supplier, or actually filing, call me at (905) 814-0111. As an experienced CPA with 25+ years, I'd be happy to assist.

The way this works, you're practically the owner of the goods until they reach the hands of the customer. So if you live in a non-participating province and are selling to a participating province (e.g., Ontario or Nova Scotia), you will have to collect HST. However, if the customer comes and picks up the product in your province, you only charge 5% GST plus the appropriate provincial tax.

This is why it's really important to know the tax laws around HST/GST/PST, as you don't want to be struck with a surprise 13% charge on all revenues after $30,000. Remember rule #1 of wealth creation: don't lose money. Step #2: don't forget #1. Being liable for 13% is no joke. For every $1,000 of revenue you'll have to fork up $130.00 from your profit if you didn't charge when you should have.

Things get more complicated if you're selling zero-rated goods and services (where you're exempt from collecting HST on behalf of the government) or exporting to a foreign country. Knowing when (and when not) to charge HST/GST/PST can make you more competitive by letting you price your product or service accordingly.