GST / PST Remittances

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Goods and services tax (GST) is a tax that applies on most supplies of goods and services made in Canada. Examples of goods and services for which GST is not charged and collected include:

Used residential housing
Long-term residential accommodation
Most health, medical, and dental services
Child-care services
Most domestic ferry services
Legal aid services
Many educational services or tutoring services
Music lessons
Most services provided by financial institutions
Insurance policies
Most goods and services provided by charities

Certain goods and services provided by non-profit organizations, governments, and other public service bodies.

Companies which provide taxable supplies in Canada, and have total revenues from taxable supplies of $30,000 or less in the last four consecutive calendar quarters must register for GST. When registering for GST, the reporting period should be the same as your fiscal year for income tax purposes. Input Tax Credits (ITC’s) can be claimed on the GST return to recover GST paid or owed on purchases and expenses for the business. When completing the GST return, deduct the total ITCs for the reporting period from the GST collected and the result would be the net GST Refund (or payable ).

For companies with $500,000 or less in annual taxable revenues, there is an option to either have a quarterly reporting period or an annual reporting period. If your reporting period is monthly or quarterly, the filing and remittance deadline is one month after the end of the reporting period. If your reporting period is annual, the filing and remittance deadline is usually three months after the end of the reporting period.

For annual filers, if your net tax for the current or previous quarter is less than $3000, then paying quarterly installments is not necessary. For those who need to make installment payments, the deadline is one month after your fiscal quarter end date.

British Columbia Provincial Service Tax (PST) is charged on most new and used products and many services. As of February 21, 2007, registration and collection of PST may be optional for those who have gross sales of qualifying goods and services in the past twelve months of $10,000 or less.

Some items which are exempt from PST in BC include:

Clothing patterns, and yarn or fabrics purchased for the purpose of making ore repairing clothing
Food products
Clothing and footwear for children 14 and under
Abrasives used in a business
Books, newspapers, and magazines
Insulation
Smoke alarms
Specified energy conservation materials
Bicycles
Many medications sold on the prescription of a physician, dentist, or veterinarian
Equipment rental
Work-related safety equipment
General safety equipment

A taxable service in BC is any service provided to install, assemble, dismantle, repair, adjust, restore, recondition, refinish or maintain tangible personal property; such as repairs or maintenance of automobiles, furniture, computers, televisions, watches, business equipment, software, gas, and electricity.

You must register for a PST account if you:

Regularly sell taxable goods
Lease Taxable goods as a lessor
Provide legal services
Sell parking rights within the Greater Vancouver transportation services region
Provide taxable services
Provide telecommunication services
Sell propane

Reporting periods for PST is set at the time of registration based on what was reported as the estimated monthly PST collectable. PST return is to be filed and remitted by the 23rd of the month following the reporting period end date.