What’s New with CRA
For companies that are annual GST/HST filers, once they owe more then $3k in the prior year they will need to pay quarterly installments in their current year. It used to be that once you filed a remittance and were required to pay quarterly installments, you would be informed by CRA on the current year’s quarterly amount which was based on the prior year actual.
That has changed in the last couple of years. Now, the owner has to determine this themselves and it is not based on the prior year. The owner has to determine what their annual payable will be and then divide that by 4 for a quarterly amount. If the owner guesses incorrectly and does not pay enough, they will be charged interest for short paying all of the installments. This is unfair, but is what happens even if any remaining amount is paid on time of the annual filing deadline.
Our best solution would be to move businesses from being annual to quarterly filers. To change from annual to quarterly filing, a form GST20 must be filed no later then 2 months after the beginning of the fiscal year. Please advise your annual filer clients, they will be grateful to you. If it does change, let Terri in our office know as well.
For those clients that have not changed, it is recommended that you pull draft HST reports every quarter to ensure the installments to date are equal to the amount owing in QB. Ensure this is done prior to the reporting end date of the last return in the fiscal year as well, so that any underpaid installments can be issued.
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