News and Insights

CRA News Release, “Government of Canada announces new electronic filing requirements for GST/HST registrants”

Tax Development Jan 04, 2010

The Canada Revenue Agency announced proposed changes to electronic filing requirements for GST/HST registrants, which will be effective July 1, 2010.  Currently, only certain registrants may file a GST/HST return electronically.  As a result of the proposed changes, all registrants, including those registrants that file a return with Revenu Québec, will be able to file electronically.   

Effective July 1, 2010, the following groups will be required to file their GST/HST returns electronically: 

  • GST/HST registrants with greater than $1.5 million in annual taxable supplies (except charities); or
  • all registrants required to recapture input tax credits for the provincial portion of the HST on certain inputs in Ontario or British Columbia; or
  • builders affected by the transitional housing measures announced by Ontario or British Columbia.  

Under the proposed changes, registrants who fail to file an electronic GST/HST return in the correct format, or who fail to report required information will be subject to penalties.

In addition, there will be new GST/HST reporting requirements that will be added to the GST/HST NETFILE return.  Large businesses (registrants with annual taxable supplies greater than $10 million) will be required to recapture input tax credits ("ITCs") on the provincial portion of the HST paid in Ontario and British Columbia on certain restricted expenses.  Registrants who are subject to the recapture will be required to report the gross ITCs on one line, with two separate recapture fields for the restricted provincial component of HST, one for Ontario and one for British Columbia.

The recapture must be reported in the period in which HST became payable, and any failure to report recaptured ITCs must be corrected through an amended return.

Please see the links below for the complete CRA news release, along with the backgrounder. The CRA has also issued GST/HST Notice No. 249, which provides questions and answers that reflect the proposed changes to the reporting requirements.

CRA News Release 100104
CRA Backgrounder
CRA GST/HST Notice No. 249