GST/HST return filing checklist

Confirm the reporting period and due date

Start with the period you are actually filing, not the one you assume. The CRA assigns a default reporting period based on revenue, and your reporting periods and due dates are listed in your CRA account. You may be able to change to a more frequent period from the same account if that suits your bookkeeping.

For monthly and quarterly filers, the filing and payment deadline is one month after the end of the period. A quarter ending March 31 is due April 30; a month ending July 31 is due August 31. Annual filers are generally due three months after fiscal year-end, with a different rule for sole proprietors with a December 31 year-end and business income: payment by April 30 and filing by June 15. If a due date falls on a weekend or a public holiday recognized by the CRA, a return or payment received on the next business day is on time. Annual filers may also owe instalments during the year, so confirm that with your accountant.

Reconcile sales and tax collected

Before opening the return, tie your sales records to your bookkeeping. Pull a sales report for the period, split it into taxable, zero-rated and exempt supplies, and compare the GST/HST in it with the tax account in your ledger. Differences usually come from invoices posted in the wrong period, credit notes, or sales to customers who were charged a different rate.

The CRA’s guidance is that you are liable for GST/HST on the earlier of the day you receive payment and the day payment is due, and you generally treat the due date as the invoice date or the date set in an agreement. That means the tax on an unpaid invoice normally belongs on this period’s return. Line 103 asks for tax collected or collectible on both paid and unpaid invoices. Line 101 is total revenue for the period, including zero-rated and exempt supplies, before GST, HST and provincial sales tax, rounded to the nearest dollar, and without amounts you reported on an earlier return.

Support your input tax credits

Input tax credits recover the GST/HST you paid on purchases and expenses used in your commercial activities, and they are reported on line 106. The CRA requires that you hold sufficient documentary evidence before you make the claim, so gather it while you prepare the return, not afterwards.

The documents depend on the size of the purchase. For a total under $100, the invoice or receipt must show the supplier’s name, the date and the total paid. From $100 to $499.99, it must also indicate the GST/HST charged or included, identify taxable and exempt items if both appear, and show the supplier’s GST/HST registration number. At $500 or more, add the buyer’s name, a brief description of what was bought and the terms of payment. The CRA also reduces the documentation in some situations, such as employee allowances and contracts, so ask before assuming a missing item blocks a claim.

Not everything qualifies. Purchases for personal use, for making exempt supplies and certain capital property generally cannot be claimed, and the expense must be reasonable for your business. Many registrants can also claim a credit missed earlier on a later return, generally within four years measured by return due dates (two years for some larger businesses), so check prior periods for unclaimed credits.

Complete the key return lines

Whether you use your CRA account or other software, the same lines drive the result. Line 103 is the GST/HST collected or collectible. Line 104 holds adjustments that increase your net tax, such as recovering tax on a bad debt you previously wrote off, and once-a-year add-backs for things like part of the credits claimed on meals. Line 105 is the total of 103 and 104, and electronic filers see it calculated automatically.

Line 106 holds your input tax credits, and line 107 holds adjustments that reduce net tax, including bad debt write-offs where you already accounted for the tax. Line 108 totals lines 106 and 107, and line 109 is your net tax. If you use the quick method of accounting, the calculation differs and you generally cannot claim credits on operating expenses, so confirm which method you are on first.

Two common mistakes are keying errors on lines 101 and 106 and claiming credits on personal expenses. Keep a working copy of the numbers behind each line.

File and pay on time

Nearly all registrants must file electronically; the exceptions are charities and selected listed financial institutions. A paper return filed without an exemption can attract a penalty. The usual route is your CRA account, which pre-fills some of your business details. The CRA also lists other electronic options, such as third-party software, a financial institution and phone filing, each with its own limits.

Paying is separate from filing. You can pay online, at a financial institution in Canada or a Canada Post location, or by mail, and online payments need no remittance voucher. In-person and mailed payments do, and the CRA says to use Form RC158 for a payment made on filing. A late or short payment carries interest. If you cannot pay in full, contact the CRA as early as you can rather than waiting for a notice.

Nil returns and fixing mistakes

A registrant must file for every reporting period, even with no sales, no net tax to remit or an account being closed. A nil return reports zeros. Skipping it can lead to late-filing penalties, so put each period in your calendar.

If you find a mistake on a return you have already filed, do not file a second return. Use Adjust a return in your CRA account, or mail a signed letter with your business number, the period, corrected amounts for each line and a contact. Where errors may attract a penalty, the Voluntary Disclosures Program may offer relief. The CRA normally processes returns within four weeks and refunds are generally issued in that time, though a missing return elsewhere can hold a refund. Keep a copy of the return and your working papers in case of a review.