Here’s an exciting event to mark on your admin calendar. For eligible individuals, the government sends out a quarterly tax credit for GST/HST payments. It is a tax-free payment deposited into your account or sent via cheque if you meet the income threshold set out by the government, as long as you filed a tax return the previous year. Let’s break it down.
What is GST/HST?
Goods and Services Tax (GST) or Harmonized Sales Tax (HST) is the additional tax you pay whenever you purchase most goods and services in Canada.
HST is a bit more complicated, but it’s basically a combination of federal and provincial taxes on goods and services in five Canadian provinces – Ontario, New Brunswick, Newfoundland and Labrador, Nova Scotia, and Prince Edward Island
All these provinces have a HST tax rate of 15% except Ontario, where it is 13%.
Now that we know what the tax is, why does the government credit GST/HST?
The GST/HST credit payment is designed to help low-moderate income families offset the burden of having to pay GST and HST. The Canada Revenue Agency (CRA) will pay out the GST/HST credit for 2021 on these dates:
January 5, 2021
April 1, 2021
July 5, 2021
October 5, 2021
However, there are certain eligibility requirements set by the federal government that dictate who receives a GST/HST credit.
What are the Eligibility Requirements?
Here are some quick ways to determine eligibility:
- You are 19 years of age or older
- You have (or had) a spouse or common-law partner
- You are (or were) a parent and live (or lived) with your child (if you applied for the Canada child benefit (CCB) you may already be receiving the child portion of the GST/HST credit)
- You are a Canadian resident for income tax purposes
- You have a social insurance number (SIN)
- You filed an income tax return last year
How Much GST/HST Credit Could You Receive?
The good news is, you don’t have to do any complex calculations to figure out this refund. The credit you receive depends on your individual (or household) net income and number of children under age 19 in your household.
The calculation is based on your tax return for the previous year. Eligible recipients who are single can get up to $456, married couples can get up to $598, plus a household can receive up to $157 per child under age 19.
|Household size||Adjusted household net income|
|A single parent with one child||$53,992|
|A single parent with two children||$57,132|
|A single parent with three children||$60,272|
|Married/common-law couple with no children||$50,852|
|Married/common-law couple with one child||$53,992|
|Married/common-law couple with two children||$57,132|
|Married/common-law couple with three children||$60,272|
Important: You do not need to have any income to qualify, but you do need to have filed an income tax return the previous year.
Conclusion You may be able to benefit from the quarterly GST/HST credit, which gives individuals and households under the income limit a relief from all the GST/HST they pay every time they purchase goods or services. The next date is coming up soon – July 5th! – and will come via direct deposit or cheque. To receive the correct payment, make sure that you have filed your taxes and have up-to-date information with the CRA.