The Goods and Services Tax (GST) is a federal tax levied on the supply of most goods and services. It is applied at a rate of 5% to the sale of goods, services, and intangible property across the country. Some provinces combine the GST with their Provincial Sales Tax to create the Harmonized Sales Tax, which is applied at a combined rate.
The GST aims to generate revenue for the government and ensure a broad-based, consumption-based taxation system across Canada.
Businesses registered for GST collect the tax on behalf of the government and remit it to the Canada Revenue Agency (CRA). Individuals and businesses that incur GST on purchases for business purposes can claim input tax credits (ITCs) to offset the GST paid.
As of 2022, the HST is applicable in Ontario, Nova Scotia, New Brunswick, Newfoundland and Labrador, and Prince Edward Island. The HST rates vary by province, typically ranging from 13% to 15%. Businesses in HST provinces collect the tax and remit it to the CRA, which then distributes the provincial portion to the respective provinces.
Excise taxes are levied on the consumption of specific goods or services produced or offered within the country to generate revenue for the government. These indirect taxes are included in the price of the goods and collected by the federal or provincial governments. Excise tax is an inevitable cost of doing business.
Filing excise tax in Canada is important for several reasons –
We can assist you with filing HST/GST/Excise tax by providing expert guidance and support throughout the process. Our services include thorough review of your financial records, accurate preparation of tax returns, identifying eligible deductions and credits. Consult with one of our tax experts at ATA Professional Corporation now.
