GST/HST CREDIT: Explained

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We all pay Goods and Services Taxes (GST) and, depending on your province, you may pay for it as part of a Harmonized Sales Tax (HST). These taxes are federal “consumption” taxes– meaning they represent a percentage collected by merchants on all sales of consumer goods and services payable to the Government of Canada. Many Canadian citizens are entitled to credits or rebates for GST and HST, but don’t know what they are or why they receive them.

CRA defines GST/HST credit as “a tax-free quarterly payment that helps individuals and families with low or modest incomes offset all or part of the GST or HST that they pay.” Read on for Liu & Associates’ brief summary of how GST and HST credits work and discover if you are eligible!

 

AM I ELIGIBLE FOR THE GST/HST CREDIT?

From CRA’s Frequently Asked Questions–

“You are eligible for this credit if, you are a resident of Canada for income tax purposes in the month prior to and at the beginning of the month in which the GST/HST credit is issued and at least one of the following applies:

  • You are 19 years of age or older before the month in which the CRA issues a quarterly payment;
  • You have (or previously had) a spouse or common-law partner; or
  • You are (or previously were) a parent and live (or previously lived) with your child.”

*There are exceptions to these conditions– for more information, refer to the CRA’s regulations of contact your Liu & Associates professional.

 

HOW DO I APPLY FOR THE GST/HST CREDIT?

From CRA’s Frequently Asked Questions–

“Starting with the filing of your 2014 income tax and benefit return, you no longer have to apply for the GST/HST credit. The CRA will determine your eligibility and will issue the GST/HST credit to all entitled individuals. An application is still required to receive the GST/HST credit based on your 2013 and prior returns. To apply, you have to file the applicable income tax and benefit return, even if you have not received income in the year.”

*There are exceptions to these conditions– for more information, refer to the CRA’s regulations of contact your Liu & Associates professional.

As the GST/HST credit is based on family structure and net income, it is vital you provide the CRA with yearly tax returns to ensure you receive any credit for which you are eligible. Incomplete or unfiled returns can delay your approval, so follow CRA regulations to the letter to receive your credited amount in a timely fashion– or take the pressure off and have an accounting professional at Liu & Associates handle your finances and complicated family accounting.