Cra backdating gst registration
Expenses are things that are consumed within a year like office supplies, rent and utilities, and these you can write-off directly as an expense in your books.
If something you purchase will be used for more than a year, such as a desk, printer or vehicle, it is consider an asset.
First, if you are an independent, self-employed sub-contractor, any work you do is for clients not bosses. If you have only one client, you may not meet CRA's criteria for being an independent contractor and may in fact be an employee. However, if your client pays GST/HST on amounts that pertain to a non-GST/HST registration period, he will NOT be eligible to claim the ITC ... 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.
Second, while registering for GST/HST is voluntary prior to earning ,000, you cannot "backbill" GST. Hi there, I find your website very helpful but it's a lot to take in when first starting.
(That's called a capital cost allowance and the government has specific formulas for how each class of assets can be reduced in value.) You'll probably have heard of people talk about depreciation - depreciation is the amount of each asset's value that you can claim as an expense each year.
This is also why some companies choose to lease equipment, as leases are treated differently on your books, with the company being able to expense lease payments as they are made.
The process can be a bit complicated if you are incorporating the company; if you are going to operate as a sole proprietor it is straight forward as long as you keep the necessary receipts.
You will want to get an accountant or skilled bookkeeper to help you do this properly and also to help you get your business set-up correctly with a decent bookkeeping software package.
Secondly, if you are making a major purchasing and will be registering to collect GST/HST (or the PST and the assets you are buying would qualify for a PST exemption), you may want to hold off on your purchase until you have everything in place to get the tax back, which could end up being a larger savings than the discounted sale price.
It sounds like the equipment you are purchasing will fall into this category.
With assets you do not expense the full cost when you spend the money, but instead you deduct a part of the purchase cost each year as the asset decreases in value.
Do I still have to charge GST on every sale of service so I can give it to the government at the end of the year? Hi Chris, Only GST/HST registrants are authorized to collect GST/HST.
If you choose not to register when it is not mandatory (under the thousand threshold), then you do no charge GST/HST.