GST/HST Input Tax Credits (ITC): Who Qualifies and What You Get
Learn how registered businesses in Canada can claim refunds or credits for the sales tax paid on business-related expenses.
If you are a registered business in Canada, you may be able to recover the sales tax you pay on things you buy for your business. This mechanism allows you to claim credits or receive refunds for the tax spent on business-related inputs.
Who it's for
This is specifically for businesses that are registered for GST/HST.
What you get
You can receive refunds or credits for the sales tax you have paid on items and services used for your business operations. This helps offset the tax costs of running your company.
What it costs you
While there is no fee to claim these credits, there is a significant administrative requirement. You must keep all of your business invoices and receipts for at least 6 years to prove your claims.
The catch to know
You cannot claim these credits on "exempt supplies." This refers to certain types of goods or services that are not subject to the tax system, which means you cannot recover the tax paid on them.
How to apply
- Ensure your business is properly registered for GST/HST.
- Collect and save every invoice for your business purchases.
- File your regular GST/HST returns.
- Claim your credits through the official portal: https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/gst-hst-businesses/complete-file-input-tax-credits.html