How do I report my income when I use the Quick Method?
You must enter your GST/HST number in the Identification section in order to see the Quick Method input fields.
If you have elected to use the Quick Method for GST/HST, there are a few additional steps to reporting your income.
At a high level, you must pay tax on your revenue and your government assistance, which is the difference between the tax you collected from your customers and the tax you were required to remit to the CRA.
Consider a simple example in which an Alberta resident with a services business (remittance rate of 3.6% ) had $100,000 in total sales and collected $5,000 in GST on those sales. Her quick method election was in effect at the start of her fiscal year, so she qualifies for the 1% credit on her first $30,000 of sales.
The following amounts are from her GST/HST return:
- line 101 is $105,000 (sales + GST/HST collected)
- line 103 is $3,480 ([line 101 x remittance rate] minus [$30,000 x 1%])
To calculate her adjusted gross sales she should:
- enter her gross sales, including sales tax ($105,000)
- enter sales tax collected ($5,000) on the next row
- answer “Yes” to the Quick Method question
- enter sales tax collected ($5,000)
- enter the amount from line 103 of her GST/HST return ($3,480)
Her adjusted gross sales will be $101,520 ($100,000 in sales + $1,520 government assistance—the sales tax she collected from her customers but didn’t have to remit to the CRA).