HST Return Collected By Unregistered Vendor

by CHal
(Burlington, Canada)

HST Return for 2010 Tax Year.

Hi Bookkeeping-Essentials,

My small business income is less than $30,000.

I collected GST/HST and paid GST/HST during the year. I am not a GST/HST registrant.

Do I need to complete a GST/HST return to CRA? If yes, how?


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What you have done is a big NO-NO. Only GST/HST registrants are authorized to collect the sales tax and claim input tax credits.

I believe what you need to do now is write a letter to CRA explaining what you have done. Attach a cheque for the amount collected.

You could include the amount of your input tax credits .... but I wouldn't hold my breathe as ITCs can only be claimed from the day you register (with some exceptions).

I have no idea if the CRA will assess any kind of penalty or fine. For a first time occurrence and the fact you disclosed what you have done, there may be no penalties.

You might also want to consider consulting with an accountant or lawyer prior to contacting CRA ... or calling CRA to speak with them before sending your letter. It all depends on your comfort level.

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.

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Apr 01, 2011
Collecting GST/HST When You Were Not Registered
by: Bookkeeping-Essentials

I thought I would update this post.

I was reading in a bookkeeping forum tonight that if you send copies of the invoices where you were charging GST/HST along with your written letter, CRA will ... are you ready to hear this? ... back date your registration to that date.

This enables you to claim your input tax credits.

Apr 28, 2017
Dumb or What?
by: Allen

So there is no need to register for GST/HST if your business makes below $30,000/year. How in the hell would one know if your new business is going to earn below that or earn a million dollars in the 12 month time frame? Say I decide not to register for GST/HST and don't collect a cent for GST/HST for goods sold and my new business goes on to earn 5 million dollars, what then?

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All I can say is if you think you are going to make $5 million in your first year, you should register for GST/HST. You might also want to research mandatory registration when meeting or exceeding the $30,000 threshold ...


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