How Merchants Register, Charge, And Remit GST/HST — A Practical Guide

GST/HST Registrant A person or business registered for Canada's GST/HST under the normal or applicable special regime. This practical guide takes a merchant step-by-step through registering with CRA, charging the correct tax at point of sale, remitting and filing returns, and claiming input tax credits.

Registration for GST/HST is the operational turning point for a merchant: it requires changes to invoicing, POS systems, accounting workflows and cash management. The process itself is straightforward — apply for a Business Number (BN) and a GST/HST program account — but the downstream rules around place of supply, zero-rating, and ITC documentation require attention.

Step 1 — Determine Whether To Register

Start by monitoring taxable revenues. If your taxable supplies in Canada cross the CRA small-supplier threshold during the measurement period, registration becomes mandatory. If you remain below the threshold, you can still register voluntarily to claim input tax credits. Decide based on expected inventory purchases, capital expenditures and your customers’ needs for compliant invoices.

Step 2 — Apply For A Business Number And GST/HST Account

Register online via the CRA’s business registration service, by phone, or through an accountant. When you register you’ll receive a Business Number (BN) and a GST/HST account number. Record the assigned reporting period (monthly, quarterly, or annually) — larger registrants usually file more frequently.

Step 3 — Configure Pricing And Point-Of-Sale

Update your POS and e-commerce platforms to charge the correct tax based on the customer’s shipping or delivery address (place-of-supply rules). For in-store sales, configure terminals to apply the provincial rate where the sale occurs. For online sales, implement logic to determine whether GST or HST applies, and at what rate.

Step 4 — Understand Tax Treatment Of Supplies

Classify sales correctly: taxable (standard-rate), zero-rated (taxed at 0% but claimable ITCs, common for exports), or exempt (no GST/HST charged and no ITCs claimable). Misclassification is a frequent audit trigger; maintain clear documentation, especially for exports, returns and warranty work.

Step 5 — File Returns And Remit Net Tax

On each reporting period, calculate total GST/HST collected minus allowable ITCs to determine net tax owing. File the GST/HST return through CRA’s online services or authorized software and remit the net balance by the due date. Late filings and remittances attract interest and possible penalties.

Step 6 — Keep Records And Support Claims

• Invoices And Receipts: Keep supplier invoices, sales receipts, contracts and customs documents that support collections and ITC claims.
• Import Documentation: Retain CBSA import records if GST/HST was paid at the border or deferred.
• Retention Period: Maintain records for the CRA’s required period (typically six years) and ensure records are accessible for audit.

Practical Example — Multi-Province E-Commerce Store

An online store based in Alberta sells products across Canada. After registering, the store’s checkout logic determines the customer’s province by delivery address and applies either 5% GST or the provincial HST rate where applicable. Sales shipped to the U.S. are treated as zero-rated exports (0% GST/HST) if documentation supports the export, allowing the store to claim ITCs on inputs used to create those exported goods.

Tips To Reduce Common Errors

• Automate: Use POS and accounting systems that support GST/HST rate tables and CRA-compliant invoicing.
• Separate Funds: Hold collected tax in a dedicated account to avoid operational shortfalls at remittance time.
• Audit Trail: Keep a clear paper or digital trail for every ITC claim, including customs documents for imports and proof of export for zero-rated sales.
• Professional Help: For large multi-jurisdictional sellers, obtain GST/HST advice to handle place-of-supply, digital service rules and cross-border issues.

In short, the GST/HST Registrant must register with the CRA when required, configure systems to charge correct tax, file and remit returns on time, and keep records that justify every claim. Good system configuration and disciplined record-keeping turn GST/HST from a compliance burden into a recoverable business cost.