GST Considerations For New Business Owners

The Goods and Services Tax or GST is a consumption tax that is charged on most goods and services sold within Canada, regardless of where your business is available. Subject to certain exceptions, all companies are required to charge GST, currently at 5%, plus applicable provincial sales income taxes. A business effectively acts as an agent for Revenue Canada by collecting the required taxes and remitting them on a periodic basis. Businesses likewise permitted to claim the taxes paid on expenses incurred that relate of their business activities. These people are referred to as Input Tax Credit.

Does Your Business Need to Sign up for?

Prior to getting yourself into any kind of business activity in Canada, all business owners need to determine how the GST Portal Login Online India and relevant provincial taxes apply to both of them. Essentially, all businesses that sell goods and services in Canada, for profit, should charge GST, except in the following circumstances:

Estimated sales for your business for 4 consecutive calendar quarters is expected turn out to be 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 and a lot more.

Although a small supplier, i.e. a business with annual sales less than $30,000 is not expected to file for GST, in some cases it is good do so. Since a business can merely claim Input Breaks (GST paid on expenses) if considerable registered, many businesses, particularly in start off up phase where expenses exceed sales, may find that possibly they are able to recover a significant involving taxes. This is balanced against the potential competitive advantage achieved from not charging the GST, as well as the additional administrative costs (hassle) from in order to file returns.