Getting ready for the Harmonized Sales Tax (HST)

What is the Harmonized Sales Tax?

Starting July 1st, 2010, the Provincial sales taxes in Ontario and British Columbia will be replaced by a value-added tax structure that is combined with the Federal Goods and Services Tax (GST) to create a single, federally administered Harmonized Sales Tax (HST). The HST will be applied to most goods, property and services transacted in those provinces at a blended rate of 13% in Ontario and 12% in British Columbia. With some exceptions, the HST will apply to the same base of property and services as the GST. Not all Canadian Provinces have adopted the HST (like Quebec, Manitoba, Alberta, etc.). However, Labrador, Nova Scotia, New Brunswick, and Newfoundland have all adopted HST.

Is Your Business HST Ready?

The HST will be administered by the Canada Revenue Agency (CRA). Basically, the HST will be collected and remitted instead of the GST. If you are a GST registrant with the CRA, you are automatically registered for the HST and as a result, would continue to use your current GST/HST account number to collect and remit the HST. To do this, you will need to update your accounting and point-of-sale systems, you will need new business forms and manual cheques to adjust for the change in rate and the new point-of-sale rebates for the provincial component of the HST. Note that your filing frequency for the HST will remain the same as your current GST filing frequency.

Small Business HST Resources

The Provincial Governments of British Columbia and Ontario have published which goods and services are taxable as well as exempt from HST:

British Columbia: Rebates and Exemptions
Ontario: Tax Benefits for Consumers

What are the benefits to SB’s of the HST?

British Columbia: Benefits for Businesses and Frequently Asked Questions
Ontario: Benefits for Business and Frequently Asked Questions
Ontario: Business and Corporate Income Tax Calculator

Want to learn more about the impact of HST on small businesses?

How NEBS is responding

Our business forms and manual cheques are "universally" designed to be used across all Canadian provinces, regardless of whether they have adopted the HST or still use the GST / PST breakout. Our new design will incorporate HST/GST while all other boxes will remain the same.

Tax layout information chart