Introduction:

The Goods and Services Tax (GST) is a federal tax imposed on most goods and services in Canada. It is part of a taxation system that helps fund various government programs and initiatives. As a business owner or self-employed individual in Canada, you are required to complete and submit a GST Return to the Canada Revenue Agency (CRA) if your annual taxable revenues exceed the threshold of $30,000. In this article, we will guide you through completing and submitting a Canadian GST Return step by step.

Step 1: Register for a GST/HST account

Before completing a GST Return, ensure that you have registered for a GST/HST account with the CRA. Registration can be done online through the CRA’s Business Registration Online (BRO) system.

Step 2: Collect the required information

To complete your GST Return, gather the necessary financial records like invoices, receipts, and any other relevant documents. You will need to determine the amount of GST/HST collected and input tax credits that relate to your business transactions during the reporting period.

Step 3: Choose your reporting method

Businesses can choose between two methods to complete their GST Return: The Regular Method and the Quick Method. The Regular Method requires you to manually track all input tax credits and calculate the net tax owing, while the Quick Method simplifies calculation by using predetermined rates based on your industry type. Consider consulting with an accountant or financial advisor to help you choose the best method suitable for your business.

Step 4: Fill out Form GST34 or Form GST62

Depending on what method you choose, use either Form GST34 (if using either Regular or Quick Methods) or Form GST62 (if filing an annual return without claiming any input tax credits). These forms can be downloaded from the CRA’s website or ordered by calling their publications line.

Step 5: Complete all relevant sections of the form

For Form GST34, follow the steps below:

a. Report total sales and other revenues for the reporting period in Line 101.

b. Enter the GST/HST collected or that became collectible from customers in Line 103.

c. Input any adjustments as applicable in Line 104 and 105.

d. Calculate your net tax by adding Lines 103 and 104 and subtracting Line 105.

e. Report input tax credits claimed on eligible expenses in Line 106.

f. Calculate the tax payable or refundable by subtracting Line 106 from Line 109.

For Form GST62, simply report your total annual revenue in Line 101 and follow the instructions provided on the form.

Step 6: Submit your completed GST Return

You have three options when submitting your completed GST Return:

a. Online: Log in to your CRA My Business Account and follow the instructions to submit electronically.

b. Mail: Send your completed form and any payment (if applicable) to the address provided on the form or envelopes supplied by CRA.

c. In-person: Drop off both documents at a designated CRA drop-off location.

Step 7: Retain all supporting documentation

Ensure that you retain all records related to your GST Return for a minimum of six years as these may be requested during an audit or verification process.

Conclusion:

Filing a Canadian GST Return may seem complicated, but following these steps will help simplify the process. By maintaining accurate financial records, choosing an appropriate reporting method, and properly completing all relevant sections of the forms, you’ll be able to efficiently file your return and stay compliant with Canadian tax laws. Don’t hesitate to consult an accountant or financial advisor for professional guidance if necessary.