GST Filing for Small Businesses in BC

In most cases you don't have to register for GST in BC until your taxable sales go over $30,000, and once you do, the deadline to register is short. BC businesses charge the 5% GST. The 7% provincial sales tax is a separate tax with its own rules, explained in our post on filing BC PST.

The $30,000 small supplier limit

You're a "small supplier" as long as your taxable sales stay at or under $30,000, measured two ways: in any single calendar quarter, and over the previous four (or fewer) consecutive calendar quarters added together. Calendar quarters start on January 1, April 1, July 1 and October 1.

Use revenue before expenses from all your businesses and any associated businesses, including sales outside Canada and zero-rated sales. Leave out financial services, sales of capital property and goodwill from selling a business. Charities and other public service bodies use different limits.

When you have to register

• Over $30,000 in one quarter: you stop being a small supplier on the sale that takes you over, and you charge GST on that sale.
• Over $30,000 across four quarters, but not in any one: you stop being a small supplier at the end of the month after the quarter where you crossed it. You start charging GST on your first sale after that.

Either way, you then have 29 days to register.

Self-employed taxi and commercial ride-sharing drivers must register even as small suppliers, effective the day they start giving paid rides. More on that in our page for gig workers.

Registering before you have to

A small supplier carrying on a commercial activity can register voluntarily. Registration usually starts the day you apply, and CRA will accept a date up to 30 days earlier. From then on you charge GST, file returns and can claim back GST paid on business costs. You have to stay registered for at least one year before you can ask to cancel. If you don't register, you don't charge GST and you can't claim it back.

Reporting periods and due dates

CRA assigns your reporting period based on last fiscal year's taxable sales in Canada.

Annual sole proprietors get a later filing date. If you're an individual with a December 31 year-end and had business income for the year, your GST return is due June 15, but any GST owing is due April 30, the same split as your self-employed income tax return. If you don't meet all three conditions, the usual three months applies.

Annual or quarterly filers can choose to file more often, online or with Form GST20. You can only elect a less frequent period after 12 months, and only if your sales have dropped below the threshold for your current period. It won't change on its own. Annual filers whose net tax for the previous year was $3,000 or more may also have to pay quarterly instalments, due one month after each fiscal quarter ends.

Returns have to be filed electronically (charities and some financial institutions excepted). If a due date lands on a weekend or a public holiday CRA recognizes, you have until the next business day.

Once you're registered, you file a return for every reporting period, even if you had no sales, owe nothing, or are closing the account. A return with nothing to report is called a nil return, and CRA can charge penalties and interest on returns it doesn't receive on time.

Claiming GST back and keeping records

The GST you pay on purchases for your business comes back to you as input tax credits (ITCs), claimed on line 106. You can only claim the share used in your commercial activity, and the cost has to be reasonable for your kind of business. New registrants may also be able to claim GST on inventory and capital property already on hand.

You need proof before you claim. For purchases under $100, the receipt needs the supplier's name, the date and the total. From $100 it also needs the GST charged and the supplier's GST number. From $500 it also needs your name, a description and the payment terms. Most businesses have four years to claim a missed ITC, and records generally have to be kept for six years from the end of the year they relate to.

The Quick Method

It's a simpler calculation for smaller businesses. You still charge 5%, but you remit a set percentage of your sales (GST included), and you give up ITCs on operating expenses, though some capital purchases such as computers, vehicles and equipment still qualify. To qualify, your worldwide taxable sales including GST can't be more than $400,000, you need a permanent establishment in Canada, and you must have been in business for the full 365 days before the reporting period. Bookkeepers, tax preparers, accountants, lawyers and charities can't use it.

How we help

GST filing is one of the filings we take on, and sales tax filings are part of our bookkeeping service, which can be done monthly or quarterly. If you don't need full bookkeeping, we can build a workbook set up for your business that we use to prepare your GST filing.