News and Insights

CRA GST Info Sheets re: Builders and GST/HST Filing Requirements

Tax Development Aug 23, 2010

The Canada Revenue Agency has released two new info sheets which explain how the recapture of input tax credits (RITC) requirement applies to builders in Ontario and British Columbia and also how these requirements may impact builders regarding the mandatory electronic GST/HST filing requirements.

Info Sheet GI-099, “Builders and Electronic Filing Requirements” explains how mandatory electronic filing requirements apply to builders of newly constructed or substantially renovated housing. It also explains the criteria when a builder will be required to use GST/HST NETFILE or other electronic methods for filing GST/HST returns.  

Info Sheet GI-100, “Harmonized Sales Tax: Builders and Recaptured Input Tax Credits” illustrates through examples how the recapture of input tax credits (ITCs) may apply to a builder that is considered a large business, where they have acquired or imported specified goods or services for use in Ontario or British Columbia.  Restricted ITCs will be recaptured rather than denied; affected builders must separately identify recaptured ITCs in their GST/HST returns, and will be required to file electronically using GST/HST NETFILE.  

Registrants subject to the RITC are not permitted to forego claiming ITCs in order to fulfill the RITC requirement, even if the resulting net tax would be the same.  Failure to report recaptured ITCs in the proper manner may result in penalties being assessed.  

CRA GI-099
CRA GI-100