GST/HST Year-End Reminders

Posted on December 19, 2014 by djb | Posted in GST/HST

With 2015 fast approaching, there are a number of timely GST/HST items to consider:

1. The CRA’s administrative tolerance on any filing issues regarding Bare Trustee’s and Joint Ventures is only valid for GST/HST reporting periods ending before January 1, 2015. For further information on this issue, please see our prior posting.

2. The closely related election form will be required to be filed with the CRA sometime in 2015, depending on your situation. Please see our prior article for further details. To note, the GST25 form will be replaced with the RC4616, which is expected to be released by the CRA in early 2015.

3. T4 preparation time is fast approaching. Do not forget to ensure you are handling any GST/HST issues on the taxable benefits included on the T4. You are considered to have collected the GST/HST on a taxable benefit subject to the GST/HST, at the end of February in the year following the year in which you provided the benefit to the employee. Depending on the type of taxable benefit and the province you are located, the GST/HST to remit will vary:

a. Automobile operating expense benefits
If the last establishment where your employee ordinarily worked, or reported, in the year is located in a participating province (Prince Edward Island, New Brunswick, Newfoundland and Labrador, Nova Scotia, or Ontario), you are considered to have collected an amount equal to a percentage of the value of the benefit for GST/HST purposes, based on one of the following rates:

 • 10% for Prince Edward Island, or 6.5% if the registrant is a large business for the purposes of the recapture of input tax credits for the provincial part of the HST;
• 11% for Nova Scotia;
• 9% for New Brunswick, Newfoundland and Labrador;
• 9% for Ontario, or 6% if the registrant is a large business for the purpose of the recapture of input tax credits for the provincial part of the HST.

If the last establishment where your employee ordinarily worked, or to which he or she ordinarily reported, in the year is located in a non-participating province or territory (the remaining provinces and territories not mentioned above), you are considered to have collected 3% of the value of the benefit for GST/HST purposes.

 b. Benefits other than automobile operating expense benefits
If the last establishment where your employee ordinarily worked, or reported, in the year is located in a participating province (Prince Edward Island, New Brunswick, Newfoundland and Labrador, Nova Scotia, or Ontario), you are considered to have collected, for 2014, the GST/HST as a percentage of the value of the benefit as follows:

 • 13/113 for Prince Edward Island;
• 14/114 for Nova Scotia;
• 12/112 for New Brunswick, Newfoundland and Labrador, and Ontario;
• 4/104 for benefits relating to a motor vehicle that is subject to the recapture of the input tax credits for the provincial part of the HST, if you are a large business;

If the last establishment where your employee ordinarily worked, or to which he or she ordinarily reported, in the year is located in a non-participating province or territory (the remaining provinces and territories not mentioned above), you are considered to have collected 4/104 of the value of the benefit for GST/HST purposes as calculated above.

However, when an employee or an employee’s relative has reimbursed an amount for a taxable benefit other than for a standby charge or the operating expense of an automobile, you are considered to have collected an amount equal to 5/105 for GST or one of the following for HST:

 • 14/114 for Prince Edward Island;
• 15/115 for Nova Scotia;
• 13/113 for New Brunswick, Newfoundland and Labrador, and Ontario.

In this situation, you have to include the GST/HST for this reimbursement in your GST/HST return for the reporting period that includes the date of the reimbursement.

Article written by:  Greg Sawatsky, MAcc, CPA, CA

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