The Goods and Services Tax or GST is a consumption tax much more charged on most Goods and Service Tax Application in India Online and services sold within Canada, regardless of where your business is situated. Subject to certain exceptions, all companies are required to charge GST, currently at 5%, plus applicable provincial sales property taxes. A business effectively acts as an agent for Revenue Canada by collecting the taxes and remitting them on a periodic basis. Businesses furthermore permitted to claim the taxes paid on expenses incurred that relate to their business activities. Tend to be some referred to as Input Tax Credit cards.
Does Your Business Need to Sign up for?
Prior to going into any kind of commercial activity in Canada, all business owners need to determine how the GST and relevant provincial taxes apply to them. Essentially, all businesses that sell goods and services in Canada, for profit, should always charge GST, except in the following circumstances:
Estimated sales for that business for 4 consecutive calendar quarters is expected to be able to less than $30,000. Revenue Canada views these businesses as small suppliers and are also 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 many others.
Although a small supplier, i.e. a booming enterprise with annual sales less than $30,000 is not required to file for GST, in some cases it is beneficial to do so. Since a business is able to claim Input Breaks (GST paid on expenses) if they are registered, many businesses, particularly in start off up phase where expenses exceed sales, may find that they will be able to recover a significant quantity of taxes. This has to be balanced against the potential competitive advantage achieved from not charging the GST, and the additional administrative costs (hassle) from to be able to file returns.