GST/HST Input Tax Credit: Who Qualifies and What You Get
Learn how registered businesses can recover the tax paid on business expenses to help manage cash flow.
If you run a business that is registered for GST/HST, you may be able to recover the tax you pay on your business purchases.
Who it's for
This is for businesses that are officially registered for GST/HST.
What you get
You can get back the tax you paid on various business expenses. This includes the tax paid on items like milk and beans, as well as costs like rent. This process is often referred to as an input tax credit (ITC).
What it costs you
There is no direct fee to use this system, but it requires significant time and effort spent on meticulous record-keeping. You must track every single invoice related to your business expenses.
The catch to know
You are required to keep all your detailed receipts for at least six years. This is necessary in case a government body conducts an audit of your business.
How to apply
- Ensure your business is properly registered for GST/HST.
- Collect and save every receipt and invoice for your business expenses.
- Track the tax paid on these items throughout your reporting period.
- Report these amounts when filing your business tax returns.
For more details, visit the official portal: https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/gst-hst-businesses.html