GST/HST registrant
This article outlines the guidelines for GST (Goods and Services Tax) and HST (Harmonized Sales Tax) registrants regarding Input Tax Credits (ITCs). The focus is on helping sellers understand which purchases and expenses qualify for ITCs and which do not.
The main benefit is that you can recover GST/HST paid on eligible business expenses through line 106 claims, as long as the expenses are related to your commercial activities.
To qualify, claims need to be directly connected to your business use, consumption, or supply. Your registration status also plays a big role in determining whether you're eligible to claim.
Here are some of the purchases and expenses you might be able to claim ITCs on:
- Business start-up costs
- Business-use-of-home expenses
- Delivery and freight charges
- Fuel costs
- Legal, accounting, and professional fees
- Maintenance and repairs
- Meals and entertainment (only the allowable part)
- Motor vehicle expenses
- Office expenses
- Rent
- Telephone and utilities
- Travel
Even if your business isn’t located in a participating province, you can still claim an ITC for HST you pay when purchasing property or services in a participating province, as long as it's for your business activities.
If you’re a new registrant, there’s good news: you might be able to claim ITCs on GST/HST paid or payable for things like capital property and inventory that you already have when you register.
New registrants have special provisions for claiming ITCs on:
- Capital property
- Existing inventory at the time of registration
- Pre-registration expenses
A few things to keep in mind:
- Your claims must be directly tied to your commercial activities
- Some expenses are only partially eligible (like meals and entertainment)
- Where you’re located doesn’t stop you from claiming for purchases made in other provinces
- New registrants have special rules for claiming ITCs on assets you already own
Hopefully, this makes it easier for you to understand what you can claim and how to handle your ITCs!
For more information, see New registrants.
Christine
GST/HST registrant
This article outlines the guidelines for GST (Goods and Services Tax) and HST (Harmonized Sales Tax) registrants regarding Input Tax Credits (ITCs). The focus is on helping sellers understand which purchases and expenses qualify for ITCs and which do not.
The main benefit is that you can recover GST/HST paid on eligible business expenses through line 106 claims, as long as the expenses are related to your commercial activities.
To qualify, claims need to be directly connected to your business use, consumption, or supply. Your registration status also plays a big role in determining whether you're eligible to claim.
Here are some of the purchases and expenses you might be able to claim ITCs on:
- Business start-up costs
- Business-use-of-home expenses
- Delivery and freight charges
- Fuel costs
- Legal, accounting, and professional fees
- Maintenance and repairs
- Meals and entertainment (only the allowable part)
- Motor vehicle expenses
- Office expenses
- Rent
- Telephone and utilities
- Travel
Even if your business isn’t located in a participating province, you can still claim an ITC for HST you pay when purchasing property or services in a participating province, as long as it's for your business activities.
If you’re a new registrant, there’s good news: you might be able to claim ITCs on GST/HST paid or payable for things like capital property and inventory that you already have when you register.
New registrants have special provisions for claiming ITCs on:
- Capital property
- Existing inventory at the time of registration
- Pre-registration expenses
A few things to keep in mind:
- Your claims must be directly tied to your commercial activities
- Some expenses are only partially eligible (like meals and entertainment)
- Where you’re located doesn’t stop you from claiming for purchases made in other provinces
- New registrants have special rules for claiming ITCs on assets you already own
Hopefully, this makes it easier for you to understand what you can claim and how to handle your ITCs!
For more information, see New registrants.
Christine
