How to Apply for a GST/HST Number for Your Business

Starting a business in Canada is an exciting step for newcomers, and understanding sales tax obligations is one of the first things you need to get right. The Goods and Services Tax (GST) and Harmonized Sales Tax (HST) are consumption taxes that businesses collect on behalf of the government. If your business earns above a certain threshold, you are legally required to register for a GST/HST account and charge tax on your sales.

Understanding GST, HST, and PST

Canada has three types of sales tax:

GST (Goods and Services Tax)

The federal sales tax charged at 5% across Canada. Every province is subject to GST.

HST (Harmonized Sales Tax)

In some provinces (Ontario, Nova Scotia, New Brunswick, Newfoundland, PEI), the federal GST and provincial sales tax are combined into a single tax called the HST. For example, Ontario's HST is 13% (5% federal + 8% provincial).

PST (Provincial Sales Tax)

British Columbia, Saskatchewan, and Manitoba charge a separate provincial sales tax. In BC, you charge 5% GST (remitted to the CRA) and 7% PST (remitted to the BC government separately). Quebec has its own system called QST, administered by Revenu Quebec.

When Must You Register?

You are required to register for a GST/HST account if:

• Your total taxable revenues (before expenses) exceed $30,000 in a single calendar quarter, OR
• Your total taxable revenues exceed $30,000 over four consecutive calendar quarters

Once you exceed this threshold, you are no longer considered a "small supplier" and must register within 29 days. However, you can also register voluntarily even if your revenues are below $30,000. Why would you? Because registering allows you to claim Input Tax Credits (ITCs) to recover the GST/HST you pay on business purchases.

Should You Register Voluntarily?

Consider voluntary registration if:

• You have significant startup costs and want to recover the GST/HST paid on them
• Your clients are businesses that expect GST/HST on invoices (it appears more professional)
• You plan to grow beyond the $30,000 threshold soon

Consider NOT registering if:

• Your customers are mostly individuals who would prefer lower prices without tax
• Your business expenses are minimal
• Your revenues are well below $30,000 with no plans to grow quickly

How to Register for GST/HST

Option 1: Online (Fastest)

1. Go to CRA Business Registration Online
2. Log in with your CRA My Business Account or use the Business Registration Online service
3. Select "GST/HST" as the program account you want to register for
4. Provide your business information, including your business number (BN) if you already have one
5. Choose your reporting period (annual, quarterly, or monthly)
6. Submit the application

You will receive your GST/HST account number immediately or within a few business days.

Option 2: By Phone

Call the CRA's business enquiries line at 1-800-959-5525. A CRA agent will walk you through the registration over the phone. Have your SIN, business details, and expected revenue figures ready.

Option 3: By Mail (Form RC1)

Download and complete Form RC1, Request for a Business Number, and mail it to your regional tax services office. This is the slowest method, taking several weeks. For a detailed walkthrough, see our guide to RC1 Business Number Registration.

After Registration: What You Need to Do

Charge GST/HST on Taxable Sales

Once registered, you must add the applicable GST/HST to every taxable sale. In BC, this means adding 5% GST to your prices. Issue invoices that clearly show:

• Your business name and GST/HST registration number
• The date of the transaction
• The amount of GST/HST charged
• The total amount including tax

Collect Input Tax Credits (ITCs)

You can claim ITCs to recover the GST/HST you pay on legitimate business expenses such as office supplies, equipment, professional services, and rent (if your landlord charges GST). Keep all receipts and invoices showing the GST/HST paid.

File GST/HST Returns

Depending on your reporting period, you must file GST/HST returns (Form GST34) and remit the net tax (GST/HST collected minus ITCs claimed). Filing deadlines depend on your reporting period:

• Annual filers: Due three months after your fiscal year-end
• Quarterly filers: Due one month after the end of each quarter
• Monthly filers: Due one month after the end of each month

Choosing Your Reporting Method

The CRA offers two accounting methods for calculating your GST/HST:

Regular Method

Track the exact GST/HST collected on sales and paid on purchases. Your net tax is the difference. This requires detailed bookkeeping but gives you the most accurate result.

Quick Method

If your annual taxable revenues (including GST/HST) are $400,000 or less, you may be eligible for the Quick Method. Instead of tracking ITCs, you remit a reduced percentage of your revenues. For service businesses in BC, this is typically 3.6% of revenue including GST. This simplifies your bookkeeping significantly.

The Quick Method is particularly useful for service-based newcomer businesses like consulting, tutoring, or freelance work where business expenses are relatively low.

PST Registration in BC

If you sell taxable goods in British Columbia, you also need to register for PST with the BC Ministry of Finance. PST is separate from GST and is administered by the province, not the CRA. Most services are exempt from BC PST, but goods are generally taxable at 7%.

Common Mistakes

• Not registering on time: If you exceed $30,000, you must register within 29 days. Late registration means you should have been charging GST/HST on sales during the gap period, and you may owe that amount.
• Charging the wrong rate: The rate depends on the province where the supply is made, not where your business is located. If you are in BC but sell to a customer in Ontario, you may need to charge 13% HST.
• Claiming personal expenses as ITCs: Only business expenses qualify. Personal groceries, home utilities (unless you have a home office), and personal vehicle expenses are not eligible.
• Missing filing deadlines: Late filing results in penalties and interest. Set calendar reminders for your reporting deadlines.

For more business guides, see our articles on T5018 for contract payments and RC1 business number registration. Also check our newcomer resources page for more support.

WelcomeAide is here to help newcomers navigate life in Canada. Use our AI Newcomer Navigator for personalized help, browse our blog, or learn how to get involved.