Here’s how to know for sure!

There is a saying that you should only register for GST/HST when you hit $30,000 of sales.

That’s not necessarily true, and here’s why.

When registering for GST/HST, you have two options:

Option #1 - Register when you hit the threshold

Option #2 - Register early

Option #1: Threshold Registration

If you want to wait until you hit the threshold to register for GST/HST, the effective date of your GST/HST registration depends on when you go over the small business threshold amount of $30,000.

Depending on your business, you may never reach this threshold in taxable sales, so you will never have to register! You may also want to wait before registering since there is an additional annual filing to complete, and your bookkeeping becomes a bit more complex (hello tracking costs and GST/HST you spend!)
In this scenario, you don’t choose your GST/HST registration date. You are deemed to be registered on a certain day because you hit the registration requirements.

⁠You must register for GST/HST if your total revenues from taxable sales are over $30,000 in

a single calendar quarter, or
over four consecutive calendar quarters

A calendar quarter follows the regular calendar year: ⁠

Q1 January 1 to March 31⁠
Q2 April 1 to June 30⁠
Q3 July 1 to September 30⁠
Q4 October 1 to December 31⁠

Your consecutive quarters can start any time. For example, you are considered to be registered if you start your business in September (which is Q3) and hit your $30,000 threshold by May (which is Q2 the following year).

If you operate multiple small businesses, each individual business may not exceed the $30,000 threshold. In that case, if the total gross revenues of all your businesses exceed $30,000, you are still required to register and collect GST/HST.

For both the single calendar, quarter, and four consecutive quarter thresholds, you must collect the GST/HST on the sale that made you go over the threshold amount. This is because your effective date of registration is the day of the sale that made you go over the threshold. ⁠Therefore, you must start charging GST/HST on the $30,001 of revenues.

You must register within 29 days from that day.⁠

Option #2: Early Registration

The other option is to register early. You may be wondering why anyone would want to register for GST/HST earlier than they have to but there are some advantages:

GST/HST paid on purchases is generally refunded 100% to you, instead of deducting it on your income tax return to reduce the taxable income, you get all of it back.
If you know that you will have to register anyway, you can create your account when you register your business to remove an extra administrative task.
You won’t have to worry about or track how close you are to the $30,000 GST/HST threshold for mandatory registration.
Your client may want you to charge GST/HST depending on your business. For example, I have seen some corporate clients request that practitioners register and charge sales tax on webinars or corporate info sessions.

Once you are registered

⁠When you register for a GST/HST account, you will get a 9-digit business number (“BN”).

Your BN will be your business identification for all your dealings with CRA.
If you register for GST/HST, you will see a BN with “RT” after.
If you are incorporated or registered for payroll, you may already have a BN.

Most registrants are on an annual filing basis, with your return and payment due April 30 of the following year.

For example, corporations registered for GST/HST and have a year-end other than December 31 typically have their GST/HST return due 3-months after their tax year-end.

Even if you file annually, you may have to pay GST/HST installments if you collected more than $3,000 HST during the year.

If you pay more than $3,000 in HST to the CRA in a tax year, you must make quarterly tax installment payments next year. ⁠
⁠This is further complicated if you are in your first year; the installments are based on $3,000 pro-rated for the number of months you were registered.
Failure to make required instalment payments will result in interest charges.

Make sure to check My Business Account to confirm your filing dates.

Make the right choice for you

If you’re overwhelmed and confused about GST/HST, you aren’t alone. Most health professionals don't know whether they should register for GST/HST and what to do after registering. They miss out on saving money in their return and run into penalties because they didn't file correctly, but that doesn’t have to be you! Financial empowerment shouldn’t be reserved for accountants!

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