The GST and Your New Business
If you are just in the process of setting up your new business then you are no doubt finding yourself to be quite busy. Not only is there the operational segment of your business to focus on you also have some responsibilities concerning the administrative side of it. Perhaps you thought that this segment of your business wouldn’t need attention until the business really got up and running.
You have now discovered that you have a lot of business rules and regulations to become aware of concerning the government. Not only have you had to deal with registering your business you now have to see how the GST/HST is going to affect you.
The first thing you need to determine is whether you have to register for an account. You will have to do this if you are providing any services or taxable service through your business. Also, you have to determine if you qualify as a small supplier. If you don’t then you will need to register a GST account.
What is a small supplier?
You are going to have to do some calculations to determine whether the Government considers you as a small supplier for GST purposes. You have to include all the money that you make no matter where in the world you are selling to in regards to your goods and services. These are goods and services that are subject to GST/HST, and must also include the zero rated ones. This includes the sales of your business associates. What you do not include in this is any sales of capital property, or goodwill that your business provided, or financial services.
Generally speaking if your business brings in over $30,000 taxable income from the sales of goods and services in the quarter calendar of the year, plus over the four consecutive calendar quarters then you are going to have to charge and submit the GST/HST.
There is a test that you can perform to determine your responsibilities for the GST/HST called the Gross Revenue Test.
No doubt you are a little over whelmed not only with everything that you need to do to get your business off the ground, but also your new responsibilities including this issue with the GST/HST. The first thing you should do for your business from an administrative stand point is bring an accountant on board. This professional can help you determine your obligations in regards to the GST/HST. Plus at the same time make sure your business is getting started properly when it comes to the required bookkeeping and financial accounting.