GST for Business Owners: When to Register, What ITCs Are, and How to Stay Organized
If you’re a business owner in Canada, GST/HST can feel confusing, especially while you’re growing and trying to keep admin under control. In my time working at the CRA, I saw these issues come up constantly:
Business owners weren’t sure when they needed to register for GST/HST.
Many who were registered weren’t claiming GST input tax credits (ITCs) because they didn’t know what they were.
Others claimed ITCs but had them denied due to missing or incomplete receipts.
In this post, I’ll break these down at a high level so you can walk away with the key takeaways.
Friendly Disclaimer: This post is general information based on CRA guidance and isn’t legal/tax advice. If you’re unsure how the rules apply to your situation, it’s worth getting personalized support.
When are you required to register for a GST/HST account?
Most small businesses don’t have to register right away. The key concept is whether you’re a small supplier.
The $30,000 “small supplier” threshold
Generally, you’re considered a small supplier and not required to register until your revenue from worldwide taxable supplies exceed $30,000. Taxable supplies are sales of goods or services that are subject to GST/HST. The threshold is based on revenue before expenses and may include revenue from associated businesses, depending on your structure.
Your sales typically fall into one of three categories:
Taxable (regular-rated): GST/HST applies at the normal rate (i.e. most consulting/services, retail sales, many trades).
Zero-rated (still taxable at 0%): counts toward the $30,000 threshold, but you charge 0% GST/HST (i.e. basic groceries, many prescription drugs, many medical devices, exports of goods/services).
Exempt (not taxable): does not count toward the $30,000 threshold, and you generally can’t claim ITCs related to these sales (i.e. most residential rent, many financial services like loans/interest, many health and educational services).
To help you determine which category your sales fall into, head over to this CRA link:
Here are the two common ways businesses cross the threshold:
Scenario A: You exceed $30,000 in a single calendar quarter
If your taxable sales go over $30,000 in a single calendar quarter, you stop being a small supplier as soon as you cross the threshold, which means you’ll need to start charging GST/HST and register for a GST account with the CRA.
Scenario B: You exceed $30,000 over multiple quarters
If you exceed $30,000 over the last four (or fewer) consecutive calendar quarters (but not in a single quarter), you generally stop being a small supplier at the end of the month after the quarter you crossed the threshold. From that point forward, you’ll need to start charging GST/HST on your taxable sales.
Important exceptions
In some cases, you may be required to register for GST/HST even if you’re under the $30,000 small supplier threshold, depending on the type of supplies you provide and how your business operates. Because the rules can vary by situation, it’s worth reviewing the CRA guidance to confirm whether an exception applies to you:
What are GST ITCs?
ITC stands for Input Tax Credit. In plain terms:
An ITC lets a GST/HST registrant recover the GST/HST they paid on eligible business purchases and expenses used in their business activities, reducing the net GST/HST they owe.
The CRA lists several conditions that generally need to be met to claim an ITC:
the purchase is for consumption/use/supply in the course of commercial activities,
you are a GST/HST registrant during the relevant reporting period,
GST/HST was paid or payable,
you have sufficient supporting documentation before claiming, and
you claim the ITC within the time limit.
Time limits to claim ITCs
The CRA limits how long you have to claim ITCs. For most businesses, it’s generally four years from the transaction date. Miss the window, and you may lose the credit.
A simple ITC example
Let’s say you charged $2,000 of GST/HST to customers this quarter. You also paid $400 of GST/HST on business expenses that are ITC-eligible and properly documented.
GST/HST collected: $2,000
Less ITCs: $400
Net tax to remit: $1,600
This is why ITCs are a big deal, especially in businesses with a lot of expenses.
Should you register voluntarily before you hit $30,000?
Sometimes, yes and sometimes it creates more admin than it’s worth. Voluntary registration can make sense when the GST/HST you could recover outweighs the extra tracking and filing.
Here’s the trade-off:
If you register: you’ll need to charge GST/HST on taxable sales and stay on top of filings and record-keeping going forward.
The benefit: you may be able to claim input tax credits (ITCs) to recover GST/HST paid on eligible business expenses, which can reduce what you owe, or even create a refund.
When it’s often worth considering:
If you’re still under $30,000 but have significant startup costs. For example, if you spend $10,000 + GST on setup expenses, that’s $500 of GST you may be able to recover as an ITC once registered, as long as the expenses relate to your commercial activities and you keep proper receipts.
When you may want to wait:
If your expenses are low, you sell mostly exempt goods/services, or you’d rather avoid the added admin until you’re closer to the $30,000 threshold.
Why keeping receipts is non-negotiable if you claim ITCs
The CRA is clear: to claim ITCs, you need documentation to support your claim.
What does the CRA expect to see on receipts/invoices?
To claim input tax credits (ITCs), the CRA expects you to keep supporting documents (receipts or invoices) that include specific details. In general, your documentation should clearly show:
Who you bought from: the supplier’s business name
When you bought it: the invoice date (or the date tax was paid/payable)
What you bought: a brief description of the goods or services
How much you paid: the total amount paid/payable
GST/HST details: either the GST/HST amount charged or a clear note that GST/HST is included
Supplier GST/HST number: the supplier’s GST/HST registration number (commonly required for stronger support)
Who it was billed to: your name/business name (or authorized agent), especially for larger purchases
Payment terms (when applicable): if the invoice includes terms rather than immediate payment
If key details are missing, the CRA can deny the ITC, even if the expense itself was legitimate.
A practical receipt workflow
Good receipt habits save time, reduce back-and-forth, and help protect your GST ITC claims. Whether you do your own books or work with a bookkeeper, clean documentation means:
fewer follow-up questions
fewer missed or denied ITCs
smoother month-end reconciliations
stronger audit readiness
If you want a system that doesn’t rely on memory:
Pay business expenses from a dedicated business account whenever possible.
Capture receipts immediately (photo upload or forward e-receipts to a single inbox).
Organize files consistently (by month or vendor in a cloud folder).
Do a weekly 10-minute check to make sure receipts are uploaded and labelled.
Monthly: match receipts to transactions and keep a short “missing receipts” list so nothing gets lost at year-end.
Want to take the guesswork out of GST/HST?
As your bookkeeper, I’ll make sure your GST/HST is tracked properly, your ITCs are claimed to reduce what you owe, and your books stay CRA audit-ready, so if a review ever happens, it’s smooth and stress-free.