If you manage GST/HST for more than a handful of clients, you are probably juggling three different calendars at once: some clients file monthly, some quarterly and some once a year. Each frequency comes with its own due dates, and a missed return means penalties and interest for your client. Here is how the CRA decides which schedule applies and how to keep them all straight.
How the CRA sets a reporting period
A registrant’s required reporting period is based mainly on its annual taxable supplies (generally, its taxable sales in Canada, including those of associated businesses):
| Annual taxable supplies | Required reporting period | Can choose |
|---|---|---|
| $1.5 million or less | Annual | Quarterly or monthly |
| More than $1.5 million, up to $6 million | Quarterly | Monthly |
| More than $6 million | Monthly | Not applicable |
A business can always choose a shorter reporting period than the one it is required to use, for example to get input tax credit refunds sooner. Clients who switch need to file an election with the CRA, so make sure your records reflect the change.
When returns and payments are due
- Monthly and quarterly filers: the return and any payment are due one month after the end of the reporting period.
- Annual filers: the return and payment are generally due three months after the fiscal year end.
- Self-employed individuals with a December 31 year end who file annually: the return is due June 15, but any GST/HST owing must be paid by April 30.
- Annual filers with instalments: quarterly instalments may be required when net tax is $3,000 or more, each due one month after the end of the fiscal quarter.
When a due date falls on a weekend or public holiday, it moves to the next business day.
Why frequency mix-ups cause missed deadlines
The hard part is not the rules, it is the volume. A firm with 80 GST/HST clients might have monthly returns due every month, quarterly returns clustered at the end of January, April, July and October, and annual returns spread across the year depending on each client’s fiscal year end. Add a few clients who changed frequency mid-year and a spreadsheet quickly falls behind.
- Record each client’s reporting frequency and fiscal year end in one place.
- Note any elections to change frequency, with the effective date.
- Track filing and payment dates separately, since they differ for some annual filers.
- Remind clients early enough to send sales and expense records before the due date, not on it.
Late-filing costs
A late GST/HST return with net tax owing is charged 1% of the amount owing plus 0.25% of that amount for each full month late, up to 12 months, plus interest. Our guide to CRA late-filing penalties explains how the costs add up.
Automate the reminders
Tax Alert Pro tracks each client’s GST/HST frequency and sends email and SMS reminders before every filing and payment date, monthly, quarterly or annually. See how Tax Alert Pro works or start a free 30-day trial.
This article is general information, not tax advice. Rules and dates can change, so confirm the current details on canada.ca.
