CRA reference:
https://solidtax.ca/wp-content/uploads/2022/09/rc4058-20e-HST-Quick-Method.pdf
If I choose the quick method, can I claim all my input tax credit? (ITCs)
When you use the quick method, you cannot apply for an ITC for most purchases. This is because the amount of tax you keep approximates the ITC I would otherwise have claimed.
However, you are eligible to claim an ITC for certain purchases, such as land purchases and purchases for which you can claim a capital cost allowance for income tax purposes, such as computers, vehicles and other large equipment and machinery. More eligibility details:
For each fiscal year, you are entitled to a 1% credit on the first $30,000 of your eligible supplies (including GST/HST), for which you must charge at a 5% rate for GST or HST at the rate applicable for each fiscal year.
For example: If your business has eligible supplies and you also charge your clients GST/HST, you can have 1%*30,000=$300 credit for ITC.
I am using quick method for my HST. I purchased equipment for my business, HST cost is $500. Can I claim it?
Yes, you can. Capital cost allowance can be claimed on equipment.
What are my remittance rates?
Remittance rates for businesses that purchase goods for resale
Some businesses usually have one remittance rate. But in some cases, a business may have more than one remittance rate. For example, if a business provides supplies in both participating and non-participating provinces, more than one rate may apply.
GST/HST quick method remittance rates for businesses that purchase goods for resale, based on the province where the permanent establishment (PE) of a business is located
| PE located where GST at 5% applies | PE located where HST at 13% applies | PE located where HST at 14% applies | PE located where HST at 15% applies |
|
|---|---|---|---|---|
| Supplies where GST at 5% applies | 1.8% | 0% (and 2.8% credit) | 0% (and 3.4% credit) | 0% (and 4.0% credit |
| Supplies where HST at 13% applies | 8.8% | 4.4% | 3.9% | 3.3% |
| Supplies where HST at 14% applies | 9.6% | 5.3% | 4.7% | 4.2% |
| Supplies where HST at 15% applies | 10.4% | 6.1% | 5.6% | 5.0% |
Example: Your company is in Ontario, and you sold $40k in computers to a client in Alberta. If you choose quick method, you should calculate HST as below.
HST: $40k*0%=0 Credit: $40k*2.8%+300=$1,420
GST/HST quick method remittance rates for businesses that provide services, based on the province where the permanent establishment (PE) of a business is located
PE located where GST at 5% applies | PE located where HST at 13% applies | PE located where HST at 14% applies | PE located where HST at 15% applies |
|
|---|---|---|---|---|
| Supplies where GST at 5% applies | 3.6% | 1.8% | 1.6% | 1.4% |
| Supplies where HST at 13% applies | 10.5% | 8.8% | 8.6% | 8.4% |
| Supplies where HST at 14% applies | 11.3% | 9.6% | 9.4% | 9.2% |
| Supplies where HST at 15% applies | 12.0% | 10.4% | 10.2% | 10.0% |
Example: Your consulting company is in Ontario. you charged your Alberta clients $50k service fee, and your Ontario client $60k consulting fee. You can use the quick method to calculate HST as below:
Alberta clients: $50k*1.8%=$900
Ontario client $60k*8.8%=$5,280
