Posted on July 5th, 2017 by Gregory M. Sawatsky in Commodity Tax (HST)

Ontario HST Recaptured Input Tax Credit Phase Out – Final Reminder

Ontario HST Recaptured Input Tax Credit Phase Out – Final Reminder

As you may remember, when the Ontario PST and GST were harmonized in 2010, large corporate groups with over $10,000,000 of taxable sales were subject to the Recaptured Input Tax Credit (RITC) regime.

For certain large businesses, since harmonization, 100% of the provincial component of the HST has been recaptured on expenses such as meals & entertainment, specified energy costs, specified telecommunications, and certain vehicle expenses. As the next recapture period is on the horizon (July 1, 2017 – June 30, 2018), this is a reminder that for this upcoming period, only 25% (down from 50% in the prior period)  of the provincial component will now be required to be ‘recaptured’.

There are no more remaining reductions to be recaptured after July 1, 2018; so starting next year, large businesses will finally be able to claim the full HST paid as an ITC.

Click here for a link to our previous article, as a reminder of the rules for your reference.

About the Author

Gregory M. SawatskyPartner | MAcc, CPA, CA

As a Partner in the tax services area, Greg provides GST/HST, corporate, personal and estate tax services for the Hamilton and Halton regions.
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