HST Charged But No Business Number
I was charged HST by a small supplier (less than $30,000 annually). There was no HST number on the invoice. When questioned, the person said he had not registered for HST.
Am I required to pay HST to this supplier? What if they register after the transaction date, am I required to pay retroactively?
If the business was registered for GST, they are automatically registered for HST.
If the supplier is not registered for GST, then no, you are not required to pay ... and good catch!
In general, GST/HST cannot be retroactively charged. Claims start from the first date of registration. However, if it was mandatory for the supplier to register and they didn't, CRA will calculate the amount the supplier owes. As far as I know, the vendor cannot go back and retroactively charge the assessed amount to its customers ... but I'm not a tax lawyer.
All bookkeepers should implement the following procedure with new suppliers:
Assign someone the task of checking if the GST/HST registration number is valid
... and that the number matches
the vendor name you have been given.
This internal control procedure is discussed in my chat on Small Business Accounting Decisions - What About Internal Controls?
I would also report this supplier to CRA. GST/HST are collected in trust
for the government. If you are not registered, you are not a trustee and you are not authorized to collect GST/HST.P.S. I would like to remind you there is a difference between information and advice. The general information provided in this post or on my site should not be construed as advice. You should not act or rely on this information without engaging professional advice specific to your situation prior to using this site content for any reason whatsoever.