How To Cancel GST/HST Account
I volunteered to register for GST number. I have a lawn cutting business and will make well under the mandatory 30K.
I have not had any business yet and as a result haven't collected any GST - my income will be well under 30 K.
How do I cancel my GST number that I volunteered for?
Thanks, Brian How To Cancel Your GST/HST Account
To close out your GST account, you must fill out CRA's form RC145 Request to Close Business Number (BN) Accounts
The form can be mailed or faxed to your tax services office.
There are a few things you need to be aware of
before you cancel your GST/HST account as there will be a financial impact.
- When you are a small supplier, you must have your GST/HST account open for at least twelve months before you can close/cancel your registration.
- When you cancel your registration, any non-capital property held in supply is deemed to be sold/disposed of at fair market value (FMV). You will be responsible for collecting GST/HST on these items ... and reporting/remitting it to CRA on your last return.
- Any capital property the business owns is considered / deemed sold under change of use rules. You must self assess and pay GST/HST at that time because you have changed the primary use from commercial to non-commercial.
For example ... you bought a lawn mower that cost $400. The GST paid at time of purchase was $20. The $20 input tax credit is claimed on your GST/HST return. Now the mower is a
year old with a FMV estimated at $320. You will have to pay GST/HST using CRA's formula upon de-registering of ($20 - $0) x ($320 / $400) = $16.
- If you have any prepaid arrangements, you must adjust your final return for any input tax credits provided after you close your account.
Brian, I am uncertain as to whether CRA lets you opt out of registration if you intend to continue operating your business. You will have to call them to find out.
I am also puzzled as to why you would want to. GST/HST is a neutral tax to business
. It is an effective way to reduce your total taxes paid
It goes without saying that if you haven't had any business yet, your income will be under $30,000. Many small businesses operate at a loss the first few years, so being able to claim your input tax credits helps you reduce taxes and manage your cash flow.Where To Go For More Information
You can find out more information on how to close your GST/HST account on the CRA website*.*I like to give my readers the CRA path so they can learn how to find information on the website ... and because every time the site gets reorganized, I have trouble ... sometimes ... finding my reference source again.