Category: Canadian Personal Tax

🧾 How to Register & Open a GST/HST Account With the CRA

When a business in Canada crosses the $30,000 small-supplier threshold, or voluntarily chooses to register, the next step is to open a GST/HST account with the Canada Revenue Agency (CRA). As a tax-preparer, you’ll help clients understand how this works — and sometimes even assist with registration.

This guide breaks down every method, eligibility rules, and practical tips so you always know what to do ✅

🚦 When Do You Need to Register?

Note: Registration also applies to ride-share drivers (Uber, Lyft etc.) and taxi businesses — mandatory from day one, regardless of revenue.

🛠️ Ways to Register for a GST/HST Account

There are 3 CRA-approved methods to open a GST/HST account:

📞 Method 1 — Register by Phone

CRA Business Enquiries Line:
📞 1-800-959-5525

✅ Useful when:

• Client has complicated structure
• Corporate registration not accepted online
• Non-resident situations
• Client needs help answering questions

📂 Tip for Success:
Download Form RC1 (Request for a Business Number) beforehand and prepare answers.

✉️ Method 2 — Register by Mail / Fax

Use if:

• CRA system won’t allow online registration
• Business type not supported online
• Client already has a business number and needs new GST/HST program account

📄 Required Form:
RC1 — Request for a Business Number
Fill and mail/fax to CRA processing centre.

✍️ This is your backup method — and sometimes the only option.

🌐 Method 3 — Register Online (Business Registration Online)

Fastest option — but not everyone qualifies.

To use BRO (Business Registration Online), the client must have:

✅ Valid SIN
✅ Filed a Canadian tax return previously

🚫 Who Cannot Register Online?

🛑 Provincial corporation restrictions
Corporations incorporated in these provinces often cannot use online registration:

• British Columbia
• Manitoba
• Nova Scotia
• New Brunswick
• Ontario
• Saskatchewan
• Federally incorporated companies

In practice: Online registration works most smoothly for sole proprietors.

📌 Special Scenarios

🧠 Pro Tax-Preparer Tip

For corporations, default expectation = phone or RC1 mail-in.
BRO often rejects corporate setup — don’t waste time trying repeatedly.

🗂️ What Information You’ll Need

Prepare this info before registering:

✅ Legal & operating business name
✅ SIN (if individual proprietor)
✅ Business structure
✅ Business address & contact info
✅ Description of business activity
✅ Estimated sales
✅ GST/HST start date (effective date)

🔖 Key Form to Know

📄 RC1 — Request for a Business Number
This form covers setup for:

• Business Number (BN)
• GST/HST program account
• Payroll account
• Import/export number
• Corporate program registration

Practice Tip: Print RC1 and walk through fields with clients to avoid missed info.

💡 Practical Notes Box

🧠 You’re not “creating” a GST/HST number — you’re adding a GST/HST account under the Business Number.
BN: 9-digit business identifier
GST/HST Account: BN + RT0001

Example:
Business Number: 123456789
GST/HST account: 123456789 RT0001

📝 Final Checklist for Tax Preparers

Before registering, confirm:

☑️ Business hits registration requirement OR wants voluntary registration
☑️ Client understands GST responsibilities
☑️ You collected all business details
☑️ You determined registration method
☑️ RC1 completed if mailing/faxing

✨ Bottom Line

Most sole proprietors → Register online
Most corporations & special cases → Phone or RC1 mail-in

Mastering this step builds confidence — you’re becoming the go-to GST/HST expert 💪✅

🧾 The RC1 Form & Registering for a Business Number (BN) in Canada

To open a GST/HST account, payroll account, or import/export account with the Canada Revenue Agency (CRA), businesses use Form RC1 – Request for a Business Number. As a tax preparer, understanding this form is essential — you will fill it out often for clients, especially new businesses.

This guide breaks the form down step-by-step so you know exactly what every section means ✅

🧠 What Is a Business Number (BN)?

A Business Number (BN) is a 9-digit identifier the CRA assigns to a business.
Once a BN exists, different CRA program accounts are added under it.

✔️ RC1 is used to create the BN and add accounts like GST/HST (RT).

🧩 When You Use RC1

📝 Key Sections of RC1 (Explained)

Below is a beginner-friendly breakdown 👇

1️⃣ Business Type & Ownership Information

You’ll select the business structure:

• 👤 Sole Proprietor
• 👥 Partnership
• 🏢 Corporation
• 🏛️ Trust / Estate
• 👔 Other (e.g., joint venture)

🔑 Important Information Collected

• Legal name of individual or corporation
• Address
• Shareholders/owners (if corporation)
• Directors (corporations)
• Contact person details

🟦 Tip: For most GST/HST work early in your career, you’re helping sole proprietors and small corporations.

2️⃣ Business Details

This covers where the business operates and keeps records:

You will also describe:

• ✨ Main business activity
• 🛍️ Primary products/services
• (Up to 3 activities if multiple)

Tip for your blog audience: Encourage clients to be clear — CRA uses this to classify business activity & audit risk signals.

3️⃣ GST/HST Program Account (RT Account)

This is what most new business owners care about ✅

💡 Key Questions You’ll Answer:

🟧 Important Box:

Select whether revenue is ≤ $1,500,000 — this determines default filing period.

GST/HST Filing Frequency Rules (Canada)

🎯 Effective Date Matters

This is the start date for charging GST/HST and claiming ITCs.

📌 Tip: Do not leave blank — choose a specific date based on business start or voluntary registration date.

4️⃣ Other CRA Program Accounts (Optional)

❗You don’t need these for GST/HST only — leave blank unless needed.

5️⃣ ✅ Final Signature

The business owner or authorized representative signs.

🔐 Keep a signed copy in your client file.

📬 After Submission — What Happens?

CRA will mail:

📦 Business Number (BN)
📑 GST/HST account confirmation (RT)
🗓️ Filing frequency & start date
💡 Instructions for first return & due dates

🟦 Tax Preparer Action:
Add reminders in your calendar for the client’s first filing date.

🧰 Pro Tax-Preparer Tips

✅ Always review business activity description — vague answers can delay registration
✅ Ask clients about future payroll or import needs — avoid extra forms later
✅ Use RC1 as a guide before phone registrations
✅ Keep digital + signed copies in your files

🟨 Note Box

🧠 For sole proprietors:
Business number is tied to personal SIN — but it is still a business BN, not your personal tax number.

🪧 Sample Client Questions to Ask

✔ What date do you want your GST/HST registration to start?
✔ Estimated revenue this year? (Canada & worldwide)
✔ Will you have employees soon? Payroll needed?
✔ Do you import/export goods or services?

🌟 Summary

The RC1 form is your gateway to CRA business accounts, especially:

• BN creation
• GST/HST program account setup
• Payroll / Import-Export accounts (if needed)

Mastering RC1 means you’re ready to confidently help entrepreneurs launch and stay compliant ✅✨

🧾 Example: Mandatory GST/HST Registration & Completing the RC1 Form (Step-by-Step Guide)

Once a business crosses the $30,000 sales threshold in a single quarter or over four consecutive quarters, GST/HST registration becomes mandatory. As a tax-preparer, you must recognize when this happens and know how to complete the RC1 form correctly.

This guide provides a full walkthrough using a real-world-style example ✅

📌 Scenario: When Registration Becomes Mandatory

Meet Todd, a management consultant 👨‍💼.

📍 Todd issued the invoice on August 12 that pushed him over $30,000 — so that date becomes his GST/HST registration effective date.

🔑 Key Rule: When a business becomes a mandatory registrant, GST/HST must be charged starting on the sale that crossed the threshold — not the next invoice.

🛠️ Filling the RC1 – Step-By-Step (Based on Todd’s Example)

Below is a breakdown of how you would complete the RC1 form for Todd.

1️⃣ Business Structure ✅

Enter Todd’s personal information & business address.

TIP: Sole proprietors do not have a corporation tax account — leave corporate sections blank.

2️⃣ Business Description 🧠

3️⃣ GST/HST Section (RT Account) 🧮

🔸 Registration Reason

4️⃣ Revenue Estimates 📊

✅ You only need reasonable estimates — CRA does not verify projections at registration stage.

5️⃣ Fiscal Year & Filing Frequency 📅

👇 Even if filing annually, GST/HST payments may be required during the year — educate clients early.

6️⃣ Registration Effective Date 📍

This matches the invoice date where Todd crossed $30,000.

💡 This date controls when GST/HST must begin being charged and when ITCs can start being claimed.

7️⃣ Other CRA Accounts 🛑 (Skip if not needed)

🎯 Only register accounts the client actually needs — avoid extra admin.

📬 What Happens After Filing?

CRA will mail:

✅ Business Number (BN)
✅ RT program account number
✅ Filing frequency details
✅ When first return is due

📎 Add this to your client records & calendar immediately.

📂 Pro Tips for Tax Preparers

💡 Always track revenue for clients near the $30K threshold
💡 Explain effective date rules — prevents under-collection of GST/HST
💡 Encourage clients to keep purchase receipts (ITCs begin after effective date)
💡 ⏱️ Filing annual is simpler for new sole proprietors — unless cash flow planning requires otherwise

🟦 Quick Checklist Before You Submit RC1

📌 Final Word

Once you complete a few RC1s, the process becomes second nature. In small business tax work, you will do this often — confidence comes with practice 😎

🧾 Voluntary GST/HST Registration & Completing the RC1 Form (Beginner-Friendly Guide)

Voluntary GST/HST registration is a powerful tool for small business owners and tax preparers. Even if a client hasn’t reached the $30,000 small supplier threshold, they may still benefit from registering early — especially if they pay GST/HST on expenses and want to claim Input Tax Credits (ITCs).

This guide will walk you through:

✅ When voluntary registration makes sense
✅ How it works and key tax rules
✅ Step-by-step RC1 form walkthrough
✅ Example scenario
✅ Common mistakes
✅ Pro tips for tax preparers

🎯 What Is Voluntary GST/HST Registration?

Voluntary registration means a business chooses to register for GST/HST before reaching $30,000 in taxable sales.

💡 Key Insight: Voluntary registrants must charge GST/HST starting from their chosen effective date, not when they hit $30,000.

🤔 Who Should Consider Voluntary Registration?

Voluntary registration makes sense if a business:

💼 Has startup costs with GST/HST
📦 Carries inventory and wants to recover HST paid
📈 Expects to exceed $30,000 soon
🙋‍♀️ Wants to appear more established to clients
🔧 Provides services to businesses who can claim ITCs (B2B)

🚫 Not ideal for businesses selling mostly to consumers who cannot claim ITCs, like hair stylists, daycare providers, or small tutors — charging tax can make pricing less competitive.

🎁 Benefits of Voluntary Registration

⚠️ Responsibilities & Rules

When registering voluntarily:

⚠️ Important: You can’t retroactively claim ITCs before your effective date, except via special inventory rules.

👩‍💼 Example: Voluntary Registration Scenario

Meet Helen, a handmade craft seller.

Helen expects strong holiday sales and buys materials with HST. Registering lets her recover HST on her expenses and start charging customers GST/HST from October 1.

📝 Filling Out RC1 — Key Sections for Voluntary Registration

🟦 Checklist Tip: Always tick “Voluntary Registration” box — CRA needs this for approval.

📅 Effective Date Rules

📌 You pick the date when registering voluntarily.

From that date forward:

✅ Charge GST/HST on sales
✅ Claim ITCs on operating expenses
✅ Claim ITCs on eligible inventory (special adjustment rules)
❌ No GST/HST needs to be charged on income before this date

🧠 Pro Tips for New Tax Preparers

🧾 Track invoice dates carefully — CRA audits look for correct start date
📍 Match registration date to business cycles — e.g., before busy seasons
🗂️ Organize receipts by pre- and post-registration
👥 Educate clients about compliance to avoid penalties
📢 Inform customers before adding GST/HST

🟨 Note Box: Key Terms to Remember

❌ Common Mistakes to Avoid

✅ Quick Decision Flow

Should my client register voluntarily?

🎓 Final Takeaway

Voluntary GST/HST registration is a smart planning tool — but only when used wisely.

As a tax preparer, your job is to:

🔍 Evaluate whether benefits outweigh costs
🧾 Support clients in completing RC1 accurately
📅 Choose correct effective date
🧠 Educate clients on charging GST/HST and filing returns

Mastering voluntary registration is a core skill in Canadian tax prep — and you’re building a strong foundation!

📩 CRA Correspondence After Submitting RC1: What to Expect (GST/HST Registration Guide)

Once the RC1 form is submitted and processed, the Canada Revenue Agency (CRA) will send correspondence confirming the business number (BN) and GST/HST registration details. As a tax preparer, knowing what to expect — and what to do with these documents — is essential to staying organized and supporting your clients.

This guide explains the letters you’ll receive, timelines, key details to review, and record-keeping best practices.

📨 ✅ Types of Correspondence You May Receive

After the CRA processes an RC1 application, one of the following will happen:

📄 1. Digital Confirmation (Instant for Online Applications)

If the registration is completed online, the client may receive:

• A PDF confirmation letter immediately
• The new Business Number (BN)
• The GST/HST program account number (ending in RT0001)
• The effective date of registration

🖨️ Tip: Save or print this PDF immediately — it’s crucial for records and future compliance.

📬 2. Paper Letter (If RC1 Was Mailed or Additional Review Needed)

When the RC1 is mailed, or CRA needs to manually verify information, they will mail:

• GST/HST registration confirmation letter
• BN and GST/HST account number (RT number)
• Effective date of registration
• Reporting frequency details (annual/quarterly/monthly)

📅 Timeline: Usually 1–3 weeks, but faster during non-peak periods.

❗ Sometimes: Follow-Up Questions From CRA

In some cases — especially for:

🏢 Commercial real estate transactions
🧾 Large ITC claims
🤝 Corporate structures

CRA may send a questionnaire or request for additional details.

They may ask for:

• Business activity explanation
• Expected revenues
• Supporting documents (leases, purchase agreements, etc.)

💭 Why this happens: CRA wants to validate legitimate business activity and prevent fraudulent GST/HST refund claims.

🔎 Key Details to Review When You Receive the Letter

⚠️ Effective Date Alert: This determines when the business must begin charging GST/HST and when ITCs can be claimed.

📂 Record-Keeping Best Practice for Tax Preparers

📁 Create a permanent client folder and store:

• CRA registration confirmation letter
• Copy of RC1 form submitted
• Notes on registration date & filing frequency
• CRA correspondence history (if any)

🧠 Think like an auditor — keep everything tidy and traceable.

🟦 Pro Tip Box

🛑 Never start collecting GST/HST until CRA confirms registration.
Doing so early may result in compliance issues and repayment obligations.

🟧 Tax Workflow Tip

As soon as the letter arrives:

✅ Calendar next filing date
✅ Confirm effective date with client
✅ Update bookkeeping system settings (QuickBooks, Xero, Wave, etc.)
✅ Advise client to begin applying GST/HST on invoices
✅ Start tracking ITCs only from the effective date forward

🎯 Why This Letter Matters

This CRA confirmation letter is legal proof that your client:

• Is registered for GST/HST
• Can collect GST/HST
• Can claim ITCs
• Can show proof to third parties (e.g., landlords, lawyers, vendors)

It’s essential in scenarios such as commercial leases, real estate closings, and supplier verification.

❌ Common Mistakes to Avoid

🧾 Example Snapshot of Confirmation Information

🟩 Final Checklist for Tax Preparers

✅ Save CRA confirmation letter
✅ Verify key dates and details
✅ Inform client & update accounting system
✅ Set reminders for first filing date
✅ Keep letter in permanent tax file

By managing this step correctly, you’re building strong compliance habits and protecting your client from costly mistakes.

📅 GST/HST Filing Deadlines & Payment Dates in Canada (Beginner-Friendly Guide)

Understanding when to file and pay GST/HST is essential for tax preparers and business owners. Missing deadlines means interest and penalties, so let’s make this super clear and easy. ✅

👥 Who Needs to File GST/HST?

⚠️ Even if your sales are $0, you still must file — otherwise CRA may charge penalties.

📊 GST/HST Filing Frequencies

🧾 Annual GST/HST Filers (Sole Proprietors)

Most sole proprietors follow the calendar year (Jan 1 – Dec 31).

🛑 Big Warning:
Even though the filing deadline is June 15, any balance owing must be paid by April 30 to avoid interest.

💡 Tip for tax preparers: Always aim to file and pay by April 30 if they owe money.

🏢 Corporate GST/HST Filers

Corporations can have annual, quarterly, or monthly reporting. For corporations:

Filing deadline = Payment deadline

📅 Annual Corporate Filers

📆 Quarterly Filers

Deadline: Last day of the month after the quarter ends

📅 Monthly Filers

Deadline: Last day of the month after the month ends

📨 CRA Notifications

CRA usually sends reminders, including:

✅ Filing reminders
✅ Access codes if needed
✅ Online mailbox alerts

💡 Encourage clients to enable CRA My Business Account notifications.

💰 What Happens If You File or Pay Late?

✅ Quick Rules to Remember

🟦 Note Box 📌

Installments may be required for businesses with higher GST/HST balances.
The goal is to avoid a large payment all at once + interest charges.

⭐ Tax-Pro Best Practices

✅ Track GST/HST deadlines in your calendar
✅ Confirm filing frequency when onboarding clients
✅ Ask clients early for bookkeeping records
✅ Submit returns early if they owe money
✅ Encourage clients to automate payments if suitable

🛠️ Workflow Tip for New Tax Preparers

If a business files quarterly or monthly, you will likely do their bookkeeping regularly as well.

For annual sole proprietors, you’ll usually file GST/HST with their income tax return.

🎯 Summary Table

🌟 Final Tip

The biggest mistake beginners make is thinking June 15 = payment deadline for sole proprietors.
It’s only the filing deadline — payment is due April 30!

🛑 How to Deregister a GST/HST Account in Canada (Step-by-Step Guide)

When a business closes, stops commercial activities, or returns to small-supplier status, it may need to deregister its GST/HST account with the CRA. As a tax preparer, understanding this process ensures your clients stay compliant and avoid unnecessary filings or penalties.

This guide walks you through when, why, and how to deregister — plus pro tips to avoid headaches. 🚀

❓ When Should a Business Deregister?

A business should cancel its GST/HST number if:

✅ It permanently stops operating
✅ It sells or transfers the business
✅ Gross revenue drops below $30,000 (becomes a small supplier) and chooses to stop charging GST/HST
✅ The business changes legal structure (e.g., sole prop → corporation)
✅ No longer making taxable supplies (switched to exempt activities)

⚠️ If the business expects to continue operating—even with low sales—don’t deregister unless sure. Restarting registration later requires a new account setup.

📌 Before You Deregister

You must:

☑️ File all outstanding GST/HST returns
☑️ Pay any balances owing
☑️ Be prepared to file a final GST/HST return (up to the date CRA closes the account)

If returns are outstanding, CRA will not close the account.

🛠️ How to Deregister Your GST/HST Account

There are three methods:

📞 1️⃣ Call CRA (Recommended ✅)

📍 CRA Business Enquiries Line: 1-800-959-5525

Ask to close the GST/HST account. Provide:

• Business Number (BN)
• Reason for deregistration
• Effective date

Why this is best:
✔ Faster
✔ An agent can sometimes backdate the closure to avoid filing a partial-period (stub) return
✔ No need to mail forms

🧠 Pro Tip for Tax Preparers:
Politely explain if business activity actually ended at year-end — CRA may backdate to Dec 31 to avoid an extra short-period GST/HST return.

🧾 2️⃣ Submit Form RC145 (Mail or Fax)

If you’d rather do it in writing:

📄 Form: RC145 — Request to Close Business Number Program Accounts

You can send it via:

📬 Mail
📠 Fax

This method works but takes longer and no guarantee CRA will adjust the date for your convenience.

🖥️ 3️⃣ Online (Future Capability)

CRA has been working toward adding online deregistration in:

• Represent a Client
• My Business Account

🛑 As of now, this feature is limited — always confirm current CRA system options.

📅 Final GST/HST Return

When the account is closed, one last return must be filed for:

From: Start of the period
To: Deregistration date

This is called a stub-period return.

Example
Client closes Aug 15 → file return Jan 1 – Aug 15.

👀 Avoid by backdating: If CRA agrees to close as of Dec 31, you simply file the normal annual return instead of a short one.

🔥 Pro Tax-Preparer Tips

🏷️ Confirm the date business stopped operating early
🧾 Keep proof (email, closure documents) for CRA
☎️ When calling CRA, be polite — agents often help by adjusting dates
📅 Close account right after final bookkeeping to avoid missed filings
💬 Educate clients: Closing a business ≠ automatic GST/HST cancellation

🟦 Note Box 📌

If the business has assets with input tax credits claimed (ex: equipment), CRA may require self-assessment GST/HST on their fair market value at deregistration.

This is called a deemed disposition rule.

⚠️ Common Mistakes to Avoid

✅ Quick Checklist

Before requesting closure:

🎯 Summary

📄 RC145 Form Guide: How to Properly Fill Out the GST/HST Deregistration Form

When a business stops operating or no longer needs to collect/charge GST/HST, you may need to file Form RC145 – Request to Close Business Number (BN) Program Accounts. As a tax preparer, knowing how to complete this form correctly ensures smooth account closure and avoids CRA follow-ups.

This guide explains every section of the RC145 related to closing the GST/HST (RT) account — in a beginner-friendly, practical format. ✅

🧠 What is Form RC145?

The RC145 is the official CRA form used to:

• Deregister a GST/HST account (RT program)
• Close other CRA program accounts if needed (like payroll RP, corporate tax RC)

For this section, we will focus on closing the RT (GST/HST) program account.

🎯 When to Use RC145

Use this form if:

✔ The business has permanently closed
✔ The business is no longer over the $30,000 small-supplier threshold
✔ The business structure has changed (e.g., sole prop → corporation)
✔ CRA cannot close the account by phone or you prefer a paper trail

💡 Easier Option: You can often close GST/HST faster by calling CRA. RC145 is typically a backup option.

🧾 Section-by-Section Guide to Filling the RC145

🟦 Part A — Business Information

Provide:

• Business Legal Name
• Business Number (BN) — 9-digits
• Contact information

📌 Example BN Format
123456789 RT0001

📝 Note: GST/HST accounts always begin with RT.

🟥 Part B — Close GST/HST (RT) Program Account

This is the most important part.

🗓️ Choosing the Correct Cancellation Date

You must enter the effective deregistration date — meaning the final date GST/HST applies.

📍 Pro Tip for Tax Preparers:
Set the date at the end of a reporting period (e.g., Dec 31) to avoid having to file a stub-period return.

🔁 Asset Transfer Question Explained

This section asks whether business assets (like equipment, inventory) will transfer to another GST/HST-registered person.

| If selling business | ✔ Mark Yes |
| If simply closing | ❌ Mark No |

⚠️ Asset transfers may require GST/HST unless an election applies (Form GST44 — sale of business election).

✍️ Authorization & Signature

End by signing and dating the form as:

• Business owner (sole prop), or
• Authorized signing officer (corporation)

Include your phone number so CRA can contact you.

🧰 📦 Additional Tips for Beginners

💬 CRA Contact for GST/HST Closure

📞 1-800-959-5525 (Business Enquiries)

Agents often help you:

✅ Close the account
✅ Back-date deregistration if warranted
✅ Avoid unnecessary filing periods

📦 Quick-Reference Summary Box

RC145 GST/HST Closure Key Points

✅ Used to close GST/HST (RT) program
✅ Fill business details + choose cancel date
✅ State reason (closed / small supplier / restructure)
✅ Prefer end-of-period date to avoid stub return
✅ Call CRA instead for faster closure

⚠️ Common Mistakes to Avoid

🏁 Final Words

Understanding RC145 helps you support clients during business transitions smoothly. With this form, you show professionalism, compliance, and detailed tax knowledge — all essential for success as a new tax preparer.

🧾 Closing a GST/HST Account in Canada (RC145) — What New Tax Preparers Must Know

When a business stops operating or no longer needs its GST/HST registration, you may need to close the GST/HST account with CRA. As a tax preparer, it’s crucial to handle this correctly and advise clients before filing the RC145 form.

Below is a complete, beginner-friendly guide — perfect for reference anytime! ✅

🏁 Step 1: Understand Why the GST/HST Account Is Closing

Before filing, discuss the business situation with your client.
Common reasons include:

• ❌ Business permanently shutting down
• 👩‍🍳 Sole proprietor taking full-time employment
• 🔄 Business restructuring or incorporation
• 💤 Business is inactive with no future plans to earn income

💡 Important Client Discussion

Should the client close the account or keep it active?

Sometimes it’s smarter not to close the GST/HST account yet!

✅ Keep the account open if:

• The business might restart later
• Client plans occasional freelance/side work
• Client prefers to avoid the hassle of re-registering

CRA allows filing nil (zero) returns when there is no activity.

❌ Close the account if:

• The business is concluded permanently
• Client has no intention of future business activity
• Filing annual nil returns is inconvenient

💬 Pro Tip Box

Once deregistered, if the client starts earning taxable business income again, they must re-register for GST/HST before charging tax.

📄 Step 2: Use Form RC145 — “Request to Close Business Number Program Accounts”

✅ Submit this form to cancel the GST/HST (RT) account.
Or call CRA and request closure by phone.

Key details the form collects:

✍️ Example Reason to Write on RC145

📝 “Business ceased operations due to owner accepting full-time employment.”

Keep it simple — CRA does not need lengthy detail.

📅 Choosing the Right Closure Date

Many tax preparers recommend closing at the end of a reporting period, for example:

📆 December 31 instead of mid-year

Why?
✅ Avoid extra returns
✅ Cleaner accounting
✅ No partial periods to file

🏠 Selling or Keeping Business Assets?

On RC145 you’ll confirm whether business assets will be sold or transferred.

• If assets remain and input tax credits were claimed, GST/HST may apply on fair market value.
• If no assets or no GST/HST claimed → just select No.

📞 Filing Options

⚠️ Before Closing — Remind Client!

🔔 All outstanding GST/HST returns must be filed
🔔 All GST/HST collected must be remitted
🔔 Final return must be marked FINAL

📌 Quick Checklist for Tax Preparers

💬 Final Thought

Closing a GST/HST account seems simple — but a thoughtful conversation can save your client time and hassle later.
As a tax preparer, you are not just filing forms — you’re protecting their business future. 🌟

🏢 Closing a GST/HST Account vs. Closing a Business (Sole Proprietor vs Corporation Explained)

Understanding the difference between closing a GST/HST account and closing the business itself is essential — especially because the process differs for sole proprietorships and corporations in Canada.

This guide clearly explains what new tax preparers must know ✅

👥 Sole Proprietorship / Partnership — GST/HST Closure = Business Closure

For a sole proprietor (or partnership), the GST/HST program account is tied directly to the business.

📌 When you close the GST/HST account, you’re usually closing the entire business number.

That means:

• The GST/HST (RT) account closes 🚫
• The Business Number (BN) shuts down 📴
• To restart business later → must register again (new BN or reactivate via CRA)
• Must file any final GST/HST return ✅

This is why advisors often ask clients if they plan to operate again before shutting everything down.

💭 ❗ Client Discussion Reminder

If the owner may freelance or return to business later, consider keeping the BN active and filing nil GST/HST returns instead of closing.

This avoids the hassle of future registration 🧾🔁

🏛️ Corporations — Only Close the GST/HST Program Account

For corporations, the Business Number stays active unless the corporation is being dissolved.

📌 Corporations have multiple “program accounts” under one BN, such as:

So, when a corporation stops GST/HST-taxable activities (like selling taxable goods/services), you simply:

✅ Close the RT program account
❌ Do not close the Business Number (unless dissolving the corporation)

The corporation may still exist and earn passive investment income or other non-taxable revenues.

🧠 Example to Understand This

🔁 Can a Corporation Reopen GST/HST Later?

Yes! 🎉

A corporation can restart taxable operations anytime by simply calling CRA to reactivate or open the RT account again.

No need for a new Business Number.

📥 Key CRA Form

👉 Used for both proprietors and corporations.

🧾 Quick Reference Table

🛠️ When to File Final GST/HST Return

✅ Last day of business / end of reporting period
✅ Remit any net tax owing
✅ Mark return as FINAL

⚠️ Common Mistakes to Avoid

🚫 Thinking closing GST/HST = dissolving a corporation
🚫 Forgetting to file the final return
🚫 Closing accounts too early when client may start again soon
🚫 Confusing BN closure with program account closure

⭐ Pro Practice Tip Box

Always confirm with clients whether they truly want to close or just pause operations.
This protects them from unnecessary re-registrations and CRA delays.

✨ Final Takeaway

Understanding this distinction will help you confidently guide clients and avoid CRA complications ✅

🔁 Filing Outstanding GST/HST Returns Using the Current Year’s Access Code (Beginner Guide)

Sometimes clients fall behind on filing their GST/HST returns — especially when the business has been inactive. As a tax preparer, you may encounter situations where:

✅ a previous year’s return is outstanding,
❌ but you don’t have the access code to file it.

Good news — you can file the current year first, use that confirmation to get an access code, and then go back and file prior returns. This is completely acceptable and commonly done.

Let’s break it down step-by-step 👇

🧠 Key Concept

You do NOT need to file GST/HST returns in chronological order.

If you have access to the current year’s filing info/access code, you can:

1. File the current return
2. Get a confirmation number
3. Use it to retrieve/set an access code for previous years
4. Go back and file past returns ✅

📌 Real-World Scenario

A business has a dormant year (no sales, no expenses — nil return) and misses filing. CRA sends a reminder stating the year is outstanding.

But… there’s no access code for that past period.

You do have this year’s access code. Perfect!

🛠️ Step-by-Step Filing Guide

✅ Step 1: File the Current Year Return

• Go to CRA GST/HST NETFILE
• Enter:
  • Reporting period
  • Business Number
  • Current year’s access code
• Enter $0 in all applicable fields for a nil return
• Submit ✅

💾 Save:

• Confirmation page 📄
• PDF of submission
• Confirmation number 🧾

✅ Step 2: Use the Confirmation Number to Get an Access Code

Go back to the NETFILE page and select:

“Need an Access Code”

Enter:

🚨 Note:
If a prior return had a balance or refund, CRA permits using payment/transaction details instead — but for nil returns, the confirmation number is your tool.

You will now be prompted to choose your own access code 🎉
➡️ This becomes your permanent code for future filings too.

✅ Step 3: File the Prior Outstanding Return

Now that you have the new access code:

• Return to NETFILE
• Enter business number + the new code
• File the older return (again, nil)

💾 Save the confirmation.

🧾 Pro Workflow Tips for New Tax Preparers

📎 Keep a record of:

• All access codes 🔑
• Filing confirmations 📄
• CRA correspondence 📨

⭐ Best practice: Save PDFs for every submission

🧠 If multiple years are missing:
Repeat the process backward year-by-year as needed.

📦 Pro Tip Box

❗ Always check compliance history before filing
If CRA sees proactive filing + no balances owing, penalties can often be avoided for nil returns.

💬 FAQ

📝 Final Takeaway

This method is a lifesaver when:

• A client has missed filings 📅
• You only have the most recent access code 🔑
• Returns are nil or simple to complete ✅

As a tax preparer, mastering this workflow builds efficiency and confidence — and helps clients stay compliant without stress.