GST/HST filing in Markham

The work covers the GST/HST return (the GST34), input tax credits, the filing frequency, instalments where they apply and the notice of assessment that follows.

One tax, one registration, one return

The 13% HST is a single tax comprising a 5% federal component and an 8% provincial component, collected and administered by the Canada Revenue Agency. There is no separate Ontario registration, no separate provincial return, and no provincial sales tax audit to satisfy alongside the federal one. A Markham business registers once, under its business number, and files on the reporting period the CRA assigns: monthly, quarterly or annually depending on revenue.

The more important consequence is on the purchasing side. In a harmonized province the full 13% paid on business inputs is recoverable through input tax credits, not just the federal 5%. A Markham company buying equipment, software, components or professional services carries no embedded provincial sales tax in its cost base. That is genuinely different from a province with a separate retail sales tax, where the provincial layer sticks to every input. The rate and its composition are tabled with the source on the Ontario tax facts page.

Who is selling what, and to whom

The City of Markham’s economic development office names technology, semiconductors, autotech, life sciences, advanced manufacturing and food and beverage among its key sectors. That mix produces sales that cross borders: software subscriptions sold to customers across North America, components shipped to manufacturers in the United States, engineering and testing services for clients overseas, and food products sold to distributors in other provinces. For HST purposes each of those is a different question.

Sales of goods delivered in Ontario carry 13%. Sales delivered to customers in other provinces follow the place-of-supply rules and that province’s rate: 5% GST where no HST applies, or the local HST rate in another harmonized province. Exports of goods and many services and intangibles supplied to non-residents are zero-rated, so no tax is charged but the credits on the inputs are still claimed. Each zero-rated sale needs evidence: the customer’s non-resident status, the shipping documents, the contract. Without them, a CRA review can treat the sale as taxable and assess the 13% that was never collected.

Exporters often sit in a refund position

A Markham company whose sales are mostly exported collects little HST but still pays 13% on its Ontario purchases. Its returns therefore show a refund rather than a payment. That is normal, and it is also a pattern the CRA reviews before releasing money. The fastest refunds go to returns that are filed on time, reconciled to the ledger and supported by clean export documentation. A company in a steady refund position may also benefit from filing more frequently than its assigned period, so the credits come back sooner. We look at that choice with the actual numbers rather than by default.

The Quick Method arithmetic looks different at 13%

The Quick Method lets an eligible registrant remit a flat percentage of tax-included sales instead of tracking input tax credits on day-to-day operating purchases. You continue to charge customers the normal rate; what changes is how the remittance is calculated. There is also a credit on an initial portion of eligible supplies each year.

Whether it pays turns on how much tax the business actually pays on operating inputs. A Markham consultancy or professional practice with few purchases typically remits less under the Quick Method, because the credits it gives up are small. A distributor or manufacturer with heavy purchases usually does worse, and an exporter in a refund position generally should not use it. Collecting 13% rather than 5% also changes the base the flat rate is applied to, so an intuition formed in a GST-only province does not transfer. Our Quick Method guide works through it. Significant capital purchases remain claimable under the Quick Method, which is a common misreading.

Related companies, and the election that stops tax circulating

Family groups are common in Markham: an operating company, a holding company that owns the building, a management company charging fees. Each intercompany charge normally carries HST, which the recipient then claims back. The tax nets to nothing across the group and yet moves real cash between entities and across reporting periods. Where the conditions are met, closely related corporations can elect to treat certain supplies between them as made for no consideration, removing the tax from those charges. It is a filing with real eligibility requirements and does not apply to every related-party transaction. Our note on the election between related corporations sets out the conditions.

Registration and the small supplier line

A business must register once its taxable sales pass $30,000 in four consecutive calendar quarters. Many Markham startups and consultancies register earlier by choice, because registration lets them recover the HST on equipment, software and professional fees while revenue is still small. Registering voluntarily means charging HST on Ontario sales from that point, so the decision is worth a quick calculation. Input tax credits covers what becomes recoverable.

What is covered

• HST registration, or review of your current reporting period
• Returns prepared and filed on your assigned schedule
• Input tax credits claimed on the full 13%, including capital purchases
• Place-of-supply review for sales to other provinces and zero-rated exports
• Quick Method modelled against the regular method with your actual numbers
• Intercompany charges reviewed where a group structure exists
• Returns reconciled to the sales ledger rather than to bank activity
• CRA correspondence and refund reviews handled for you

Remote, with no office in Markham

EverStone is a fully virtual CPA firm serving BC, Alberta, Ontario and Manitoba. There is no office in Markham, and the same service covers Unionville, Richmond Hill, Whitchurch-Stouffville and the rest of York Region. Sales tax work is a records-and-returns exercise: the books, the invoices and the export documents. Nothing about it improves by being in the same building, and every return is filed electronically. Our Toronto accountant page covers the nearest large city.