GST/HST Credit Payment Dates In Canada

Have you heard about the GST/HST credit payments in Canada? Today, Canada runs a tax system that is modelled to be progressive. This implies that high-income earners pay more tax as a fundamental principle than low-income earners.

Furthermore, in order to curb the increasing tax brackets, GST/HST credit was issued by the federal government also to compensate for sales tax expenses for low-earning taxpayers.

On turning 19, you must have filed your tax return since you will be entitled to the GST/HST credit, the CRA will then make your first payment on the payment date that comes after your 19th birthday.

To access your personal benefit payment information, you can visit My Account or utilize the MyBenefits CRA mobile app. You can also subscribe to receive emails with benefit and credit payment date reminders.

The application and qualification process of the GST/HST credit is incorporated into the tax return.

GST/HST Credit In Canada

GST means Goods and Services Tax; it is a federal sales tax imposed on most purchases such as retail purchases, real estate sales, and personal services. The GST is a 5% tax imposed on all transactions.

The GST applies to all provinces all over Canada. However, some provinces further integrated the federal GST with other provincial sales taxes to create the Harmonized Sales Tax (HST). 

Only 5 provinces partake with the federal government using the harmonized sales taxes. These provinces include;

  • New Brunswick

  • Ontario

  • Prince Edward Island

  • Newfoundland and Labrador

  • Nova Scotia

This does not imply that other provinces do not have any provisional sales taxes. Provinces that do not partake in HST only keep separate the GST  from other provisional sales taxes.

Therefore the term GST/HST is used by the Canada Revenue Agency to make reference to all varieties of usage at the provincial level.

GST/HST Payment Dates In 2020

You can expect the GST/HST Credit payments on the below dates: 

  • January 3, 2020

  • April 3, 2020

  • July 3, 2020

  • October 5, 2020

  • January 5, 2021

The Canada Revenue Agency or the CRA will be making the payments and it is always on time. As you can notice the payments are made every quarter. 

The easiest way to enrol for your GST/HST credit payments is via the bank direct deposit. Make sure to log in to your CRA My Account to see the updated notes and GST/HST Payments received/pending information. 

GST HST Credit

GST/HST Credit Rates

 

Before July 1, 2010

On or after July 1, 2010

Ontario

GST at 5%

HST at 13%

British Columbia

GST at 5%

HST at 12%

Nova Scotia

HST at 13%

HST at 15%

New Brunswick

HST at 13%

HST at 13%

Newfoundland

and Labrador

HST at 13%

 

HST at 13%

Other provinces across Canada

GST at 5%

GST at 5%

Who Makes The GST/HST Payments?

As long as you’re making purchases on taxable supplies of goods and services, you will always pay for the GST/pay.

The GST/HST tax credit is also applicable to supplies of intangible personal property and distinct real property.

However, the Indians and some organizations including some particular provincial and territorial governments, are excepted to pay the GST/HST on their purchases. 

Who Are Eligible For The GST/HST Payments?

Generally, businesses that are registered with the government are charged with collecting and remitting GST/HST payments on all taxable excluding the zero-rated supplies.

What Are Zero Rated Supplies?

Some sets of supplies are referred to as zero-rated because the GST/HST rate on these supplies is 0%. This implies that the GST/HST charge does not apply to these commodities, however, the input tax credits can still be claimed on them.

Examples of these zero-rated supplies include:

  • essential groceries such as milk, bread, and vegetables

  • agricultural products like wheat, fruits, grain, raw wool, and unprocessed tobacco

  • medication drugs, and drug-dispensing aids

  • medical tools like the hearing aids, and artificial teeth

  • exports

  • international air travel (passenger) to all locations excluding the continental United States and the islands of St. Pierre and Miquelon

  • incoming international cargo transportation services for shipping goods to different destinations stipulated by the shipper

  • outgoing international cargo transportation services for shipping goods when the cost of the service is more than $5.

The GST/HST Credit

GST/HST tax credit was introduced by the federal government, on the basis of Canada’s progressive tax system, to compensate for some or even all of the federal percentage of sales taxes to low-income families.

  • The sum of the credit is dependent on each family’s net revenue, including the number of dependent children.

  • The Canada Revenue Agency does not deem the GST/HST credit as taxable income.

  • The application process for the GST/HST credit is automatic and processed through the federal tax returns

  • Tax credits can be claimed either by can be claimed only by one’s spouse or other members of the family.

Eligibility For GST/HST Payments

Generally, one is considered eligible for the GST/HST credit if you qualify as a Canadian resident for income tax purposes for the previous month and also the beginning of the month in which payments are made by the Canada Revenue Agency.

Apart from qualifications on tax purposes, one of these criteria also has to be met;

  • you are above the minimum age of 19 years

  • you have a spouse or a common-law partner

  • you have one or more children you are living with.

However, parents who share custody of a child are only eligible to half of the GST/HST credit for that child.

Furthermore, in the case where the child’s wellbeing is legally, physically, or financially catered for by the welfare agency, you will not be eligible for the GST/HST credit for that child.

Satisfying these eligibility prerequisites still does not guarantee you earn the credit. Another determinant of earning credit is your family’s income.

A notification will always be sent to you by the CRA in the case where your income is too high for the application of the GST/HST credit.

You do not need to worry about applying when your income is too high as there are no sanctions or repercussions to that. All applicants are expected to re-apply (when filing a tax return) and re-qualify every year.

How To Apply For The GST/HST Payments?

Qualifying for the yearly GST/HST tax credit requires you to file a tax return for the year prior to when the credit is being paid out.

It is expected you also file a tax return even when you have no income before you can qualify for the GST/HST tax credit. This is because individuals are not allowed to personally apply for the benefit as CRA determines qualification through the annual tax return.

In a situation where you earn the Canada Child Tax Benefit for your children, they will automatically be filled for the GST/HST credit and will always be attributed to your household credit.

Also, if you are divorced and separate from your spouse for more than 90 days, it is possible you qualify for the GST/HST as a single person. In most cases, this qualification will not impact the household credit, nonetheless, you must inform the CRA of this change in status.

However, in the situation where you are a new resident of Canada, you must complete some forms to qualify for the credit.

As a new resident of Canada, here are some steps you should follow  to apply for the GST/HST credit:

Complete one of these forms:

How Much Can You Expect From GST/HST?

The GST/HST credit payments are not always constant as they depend on some variable factors such as:

  • your household’s net income

    • If you’re single, the GST/HST credit payment will be the amount from line 236 of your income tax return, or the expected amount if you finalized one

    • If you do have a spouse or common-law partner, your net incomes are combined to calculate your family’s net income

  • the number of your children below the age of 19 years that are registered for the Canada child benefit and the GST/HST credit

For each year, the GST/HST credit payment could be up to;

  • $445 if you are unmarried

  • $585 if you are married or living common-law

  • $150 for each child below the age of 19 years of 19

Always remember to update your personal information whenever there are changes to prevent underpayments or overpayments.

To calculate your GST/HST credit, you can make use of the child and family benefits calculator.

Conditions That Can Affect Your GST/HST Payment Amount

There are certain conditions that prompt the Canada Revenue Agency to recalculate your GST/HST credit and adjust payment. Some of these conditions include;

  • an increase in income in either of you or your spouse or common-law partner lead to the reassessment of your tax returns which results in a change to your family net income

  • your eligible child(ren) turns 19 years of age

  • Change in marital status

  • Change in the number of eligible children in your care

  • Death of a recipient

  • Sharing custody of a child

Effect Of COVID-19 On The GST/HST Credit Amount

Due to the negative impact of the pandemic on the Canadian economy and its citizens, one of the ways the Canadian government has to deemed fit to help its citizens is to increase the GST/HST credit amount.

This increase will be automatic if you have been receiving the GST/HST credit and have filed for the 2018 tax return.

If you did not qualify for the GST/HST credit in the previous year but have filed your 2018 tax return, you still have the chance to qualify for a one-time credit amount based on your family’s net income.

The amount increment to be received is dependent on the information on your 2018 benefit return and benefit return. This implies that failure to have files your 2018 taxes eludes you of this increment.

We recommend that you file your 2018 taxes as soon as possible to participate in increments. Furthermore, you might also be eligible for retroactive benefits and credits but you will never know if you don’t file your taxes.

In the case where you’re not qualified for the extra GST/HST credit amount, there’s a clear chance you qualify for the Canada Emergency Response Benefit.

GST HST Credit

GST/HST Payment Increase In 2020

As mentioned above, this one-time payment will be evaluated on the basis of the information on your 2018 tax return.

The increase in amounts for the 2019-2020 benefit year is expected to range from;

  • $443 to $886 if you’re unmarried

  • $580 to $1,160 if you’re married or living with your spouse or common-law

  • $153 to $306 for each child below the age of 19 years. This excludes the first eligible child of a single parent

  • $290 to $580 for the first eligible child of a single parent

Changes will not affect:

  • The household’s net income employed to evaluate the amount

  • The household’s net income employed to evaluate the single supplement

It is important to note that the current shared custody rules also apply to this increment i.e parents who share custody only gets  half of the amount they would have received in relation to a shared custody child

Filing Your 2019 taxes

Once again, you don’t have to file your 2019 taxes to earn this increased credit amount as the compensation is based on the 2018 tax return.

However, to continue benefiting from GST/HST, it is compulsory you file your 2019 income tax and benefit return. The GST credit will be for July 2020 to June 2021 benefit year.

Determining Your GST/HST Credit

A manual calculation chart and an online calculator are both provided by the CRA so you can easily estimate your GST/HST credit amount. Details such as your household’s net income and number are registered children will be required of you to use the calculator.

GST/HST Cheques Payment Dates

The GST/HST credit is reimbursed every 4 months for each tax year. Payments are made in  July, October, January, and April and on or around the fifth day of these months.

The Canada Revenue Agency will always send the GST/HST credit payments on or around the fifth of July, October, January, and April.

In the case where you do not receive your GST/HST credit payment on the anticipated payment date, you will have to wait for a period of  10 working days before you contact the CRA.

Conclusion 

There you go, that was the complete information on the GST/HST Credit in Canada and who to claim it. 

Hope you found this article useful and beneficial. Let me know if you have any questions in the comment section below. 

Do share this article with your friends and newcomers especially, it will be useful to them. Thanks for reading! 

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