GST: when to register, and the receipts that hold up
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The $30,000 threshold has two halves, registering early is not free, and a receipt has to show certain things before the GST on it can be claimed back.
This guide is about GST only. For how GST and PST differ, and why PST never comes back to you, start with the two pages below.
How GST and PST differ in BC →
PST when your business sells goods →
The $30,000 test has two halves
You are a small supplier, and do not have to register, while your worldwide taxable revenue stays at $30,000 or less on both of two tests. That revenue includes the revenue of any associated businesses. It is measured before expenses, not as profit.
- Over four consecutive calendar quarters. If your running total passes $30,000 gradually, you stop being a small supplier at the end of the month after the quarter in which you crossed it. You start charging GST from your first sale after that.
- In a single calendar quarter. If one quarter on its own passes $30,000, you stop being a small supplier immediately. The sale that takes you over carries GST, and you have 29 days to register.
The single-quarter test is the one that catches people, usually through one large contract. A business that watches only its annual total can find it owes GST on an invoice it has already sent without it.
Registering before you have to
The case for registering early is input tax credits. Once registered, you claim back the GST you pay on business purchases: equipment, software, rent, stock. The usual advice to "register early and get your GST back" leaves out three things.
- It is not retroactive for most purchases. Input tax credits cover GST on purchases from your effective date of registration onward. The exception is inventory and capital property you still hold when you register. Services and supplies bought before that date do not come back.
- You charge 5% on every sale from that date. If your customers are registered businesses, they claim it back and it costs them nothing. If they are consumers, it is either a 5% price rise or 5% off your margin.
- It is not a trial. After registering voluntarily you generally stay registered for at least a year before you can cancel, and you file a return every period, including nil ones.
Registering early usually makes sense for a business with large start-up costs and business customers. It usually does not for a small, consumer-facing business with low costs.
What a receipt has to show
An input tax credit is only as good as the paper behind it. The documentation thresholds were raised in April 2021, from $30 and $150 to $100 and $500. A lot of published guidance still quotes the old figures, including much of what circulates in Chinese. The tiers are based on the total paid, including tax.
- Under $100: the supplier’s name or trading name, the date, and the total paid.
- $100 to $499.99: all of that, plus the supplier’s GST registration number and either the amount of GST or a statement that the price includes it, with the rate.
- $500 or more: all of that, plus your name as the buyer, the payment terms, and a description clear enough to identify what was bought.
A GST registration number is the nine-digit business number followed by RT and four digits, as in 123456789 RT0001. The nine digits alone are not the GST number.
The information does not all have to sit on one piece of paper. An invoice read together with a contract can do it. But it has to exist somewhere you can produce.
Check the number, not just that one is printed
A number on an invoice does not prove the supplier is registered. The CRA’s GST/HST Registry lets you confirm a number against a supplier’s name. If the supplier was not registered, the GST they charged is not claimable, and your remedy is with them, not the CRA. It is worth checking once for each new supplier and for any large invoice.
The mistakes that come back with interest
- Claiming from card slips or bank statements. A line on a statement is not a receipt, and it will not carry the information above.
- Claiming all the GST on mixed-use costs. A phone, a car or a home office qualifies only for its business-use share.
- Claiming full GST on meals and entertainment. These are generally limited to 50%, the same limit as for income tax.
- Claiming credits on costs of exempt sales. GST on costs that go into exempt supplies does not come back. Zero-rated sales are different, and the difference is explained on the GST and PST page.
A missed receipt is not necessarily lost. Most small businesses have up to four years to claim an input tax credit, so one found later can go on a later return.
Questions people ask
Do I need a GST number if I earn under $30,000?
No, as long as you stay under on both tests. You can register by choice, with the trade-offs above.
Can I claim GST on things I bought before I registered?
Generally not. The exception is inventory and capital property you still hold at the date of registration.
Does every receipt need the supplier’s GST number?
Only from $100 including tax. Below that, the name, the date and the total are enough.
Can I claim back PST the same way?
No. PST has no input credit. What you pay on business purchases is a cost.
BC PST when your business sells goods →
Getting it right from the first receipt
Most GST problems are not calculation errors. They are missing registration dates and receipts that do not show what the regulations require. Both are easy to get right as you go and expensive to rebuild afterwards.
Orbis Accounting files GST and PST for small businesses across Metro Vancouver, in English and Mandarin. Tell us what you sell and whether you are registered, and we confirm both in a written quote within one business day.
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