Table of Contents
- 1. How to set your GST/HST filing frequency and due dates 🗓️
- 2. What to include in your GST/HST returns and how to remit correctly 💳
- 3. Your GST/HST return reports how much tax you've collected on sales and how much you can recover on purchases. It's a simple formula: GST/HST collected minus input tax credits (ITCs) equals the amount you owe or will be refunded.
- 4. How to track input tax credits for accurate reporting 📑
- 5. Best practices to stay compliant and avoid CRA penalties 🧭
How to set your GST/HST filing frequency and due dates 🗓️
Once you've completed your GST/HST registration, the CRA assigns you a filing frequency, annual, quarterly, or monthly, based on your expected revenue. Many small businesses start with annual filings, but if your sales increase, you can switch to more frequent reporting. Doing so helps manage cash flow and keeps your records up to date.
Filing frequency isn't just administrative; it affects how soon you must remit collected GST/HST. For instance, annual filers usually have three months after their fiscal year-end to file and pay, while monthly filers have just one month. Choosing the right rhythm depends on how you manage cash flow and invoices.
Consider a SaaS startup with quarterly revenue of $45,000. If they file quarterly, they remit every three months. If they switch to monthly filing, they manage smaller, more frequent payments, which can ease budgeting but requires tighter recordkeeping discipline.
If you use cloud accounting tools like QuickBooks Online or Xero, EIM's bookkeeping services can automate those reminders and sync GST/HST due dates directly into your system. This integration ensures you never miss a CRA deadline or forget a remittance.
What to include in your GST/HST returns and how to remit correctly 💳
Your GST/HST return reports how much tax you've collected on sales and how much you can recover on purchases. It's a simple formula: GST/HST collected minus input tax credits (ITCs) equals the amount you owe or will be refunded.
Each return includes:
Total sales and other revenue (including zero-rated or exempt items).
Tax collected or charged on those sales.
Eligible input tax credits from business purchases.
Adjustments or rebates, if applicable.
Remittances can be made online through the CRA portal or directly from your accounting software. Founders often prefer electronic payments, which confirm receipt instantly. Late payments, even by a day, can trigger penalties and interest, so automation is your best friend.
"In preparing for battle, I have always found that plans are useless, but planning is indispensable." – Dwight D. Eisenhower
That applies to tax compliance. The plan matters more than perfection. EIM's cash flow management service helps founders plan for these obligations in advance by setting aside GST/HST funds in a separate account. It's a small habit that prevents big surprises later.
How to track input tax credits for accurate reporting 📑
Input Tax Credits (ITCs) allow you to recover the GST/HST you pay on eligible business expenses. But tracking them manually is one of the most common areas where founders make mistakes. To claim correctly, every receipt must include:
The vendor's name and GST/HST number
The amount of tax paid
The date and description of the expense
Using cloud accounting solutions helps store and categorize receipts automatically. Still, accuracy depends on your setup. For example, a SaaS founder who buys subscriptions in USD may need to convert them into CAD before claiming ITCs. That's where a clean chart of accounts and consistent reconciliation matter most.
Imagine a growing e-commerce business spending $8,000 quarterly on software, logistics, and packaging. If they fail to capture GST/HST receipts properly, they forfeit potentially $1,040 in recoverable credits. Over a year, that's real money left on the table.
When EIM supports startups through cloud accounting setups, we configure automated rules that flag non-claimable items and ensure every transaction matches CRA's audit requirements. That way, your reports are ready for review at any time.
Best practices to stay compliant and avoid CRA penalties 🧭
GST/HST compliance is not a one-time effort but an ongoing discipline. The CRA expects founders to file returns even when no sales occurred, a "nil return." Forgetting to file on time can lead to penalties that grow monthly until you comply.
A strong compliance rhythm includes:
Timely filing and payment reminders
Accurate ITC documentation
Regular account reconciliations
Annual review of filing frequency
For startups managing growth, these small habits prevent administrative drag. Beyond penalties, non-compliance can delay financing rounds or erode investor trust if your financials aren't clean.
"Discipline equals freedom." – Jocko Willink
When it comes to taxes, structure brings freedom too: freedom from late-night reconciliations, missed filings, and CRA letters you never want to receive. With the right systems, compliance becomes routine, and growth gets your full attention.
Founders who partner with EIM's bookkeeping and financial planning teams gain the structure and oversight that keep GST/HST fully aligned with broader financial goals. It's not just about staying out of trouble; it's about building a business that can scale with confidence.
Natasha Galitsyna
Co-founder & Creator of Possibilities
Serving the startup community since 2018
