Self Employed GST Question

[La Flames Fan]

If you never charged GST as a self-employed person, do you have to pay GST?

Simple question I know, but any help would be appreciated.

Thanks!

[MelBridgeman]

if your self employed income is greater than 30K, yes.

[La Flames Fan]

So if theoretically you were assessed the GST number two years after you made the $30,000+ can they go back and say, hey you owe us that?

[MelBridgeman]

Originally Posted by La Flames Fan

So if theoretically you were assessed the GST number two years after you made the $30,000+ can they go back and say, hey you owe us that?

The taxman can do anything.

[KTown]

Originally Posted by La Flames Fan

If you never charged GST as a self-employed person, do you have to pay GST?

Simple question I know, but any help would be appreciated.

Thanks!

I'm not sure of many self employed businesses that have a service that isn't subject to collecting GST. Just out of curiosity what do you do?

I'm a contractor and I have to collect GST on every hour I work.

[RogerWilco]

Originally Posted by La Flames Fan

If you never charged GST as a self-employed person, do you have to pay GST?

Simple question I know, but any help would be appreciated.

Thanks!

Just visit the revenue Canada web site. I can tell you that you need to collect GST after making $30,000.00 in one yearly quarter. If you pulled that off then you need to collect GST the next quarter. If you made $30,000.00 in one year, you need to collect GST the next year. Just search the revenue canada web site it is all explained there. You can get your GST number on the web site as well.

[Slava]

If you make over $30k and are not registered for the GST they (CRA) will also register for the GST for you and collect it.

[RogerWilco]

Originally Posted by La Flames Fan

So if theoretically you were assessed the GST number two years after you made the $30,000+ can they go back and say, hey you owe us that?

Not for the first year you made $30,000 only the year after. Unless you made $30,000 in one quarter, then you would be liable for the GST on each quarter after that. I hope that helps.

Mandatory registration

You have to register for GST/HST when you no longer qualify as a small supplier because your total worldwide taxable supplies of goods and services exceed the small supplier limit of $30,000 in a single calendar quarter or in four consecutive calendar quarters.

From the Canada Revenue Site


I also want to add that I am not an accountant and that is the way I understand it. But I do run a small company and do collect GST. Aslo if you provide a service in Alberta forget about the HST thing. That is only if you are in a province that has a provincial sales tax. The best thing for you to do is contact revenue Canada and just ask. Contact info is located on the link below.

http://www.cra-arc.gc.ca/tax/busines...ndatory-e.html

[MoneyGuy]

Originally Posted by MelBridgeman

The taxman can do anything.

You're probably trying to be funny, but the taxman can't do anything. There are many cases where taxpayers take CRA to court and win. It happens all the time.

[La Flames Fan]

Thanks all...

So basically the answer to my question is that if you made over $30,000 and you didn't have a GST or BN they can go back and say pay us, even though I never charged GST?

And I'd like to punch my accountant for not picking that up at the time. This is ugly.

[RogerWilco]

Originally Posted by La Flames Fan

Thanks all...

So basically the answer to my question is that if you made over $30,000 and you didn't have a GST or BN they can go back and say pay us, even though I never charged GST?

And I'd like to punch my accountant for not picking that up at the time. This is ugly.

Only the year or quarter after you made your first $30,000. Meaning not for the first $30,000 but for money made the next year or quarter. I am pretty sure this is correct or I will owe some money from my first year as well. Which was about 4 years ago and since I have done a tax return each year and have not been charged GST for the first year, I think that is how it works.

So to answer the question if you have been operating for two years and made $30,000 or more in the first year you would be liable for GST only on services in the second year.

[redforever]

And don't forget that the $30,000 also applies if you are offering your services as a consultant.

[Dan02]

If you're a small business owner you're better off getting a GST number right away anyways as the taxman gives small business a break on the GST. By having a GST number you'll actually make more money.

[calf]

You'd have to remit the GST you (should have) collected to the government. But, at the same time, if you paid GST on supplies and what not (for business purposes), you can claim that amount back (with some restrictions, like 50% of meals & entertainment).