The Goods and Services Tax or GST is a consumption tax which charged on most goods and services sold within Canada, regardless of where your business is located. Subject to certain exceptions, all businesses are required to charge GST, currently at 5%, plus applicable provincial sales tax return. A business effectively acts as an agent for Revenue Canada by collecting the required taxes and remitting them on a periodic basis. Businesses will also permitted to claim the taxes paid on expenses incurred that relate of their business activities. Tend to be some referred to as Input Tax Credit cards.
Does Your Business Need to File?
Prior to participating in any kind of commercial activity in Canada, all business owners need to see how the GST and relevant provincial taxes apply to both of 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 usually 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. organization with annual sales less than $30,000 is not expected to file for GST, in some cases it is beneficial to do so. Since a business in a position to claim Input Breaks (GST paid on expenses) if may possibly 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 ought to balanced against prospective competitive advantage achieved from not charging the GST Application Online in India, as well as the additional administrative costs (hassle) from having to file returns.