GST / HST, An Overview
GST (Goods and Service Tax) or HST (Harmonized Sales Tax) is a tax charged on the supply of goods and services made in US or Canada and on the importation of goods thereto. It is also charged in various other parts of the Globe with the same or other names like VAT (Value Added Tax), Sales Tax or Service Tax. Presently we support GST / HST preparation and filing for Canada, United States of America and Singapore.
How it affects your business?
Almost all businesses are affected by GST or HST as they either deal in goods or services. If you supply goods or services in your own country, most of such goods and services are subject to GST / HST. Similarly, if you import goods in your country, it may also be subject to GST / HST. However, if you export goods or services, it is mostly not chargeable to GST / HST and is considered as Exempt or Zero rated depending on where you do business.
Similarly, when you purchase goods or services, you pay GST / HST, which is available as Input Tax Credit (ITC) if you used such goods or services in supplying your goods or services. To put it otherwise, GST / HST paid on goods or services purchased is available as credit while paying GST / HST while you supply goods or services.
Based on your turnover or tax liability, you need to remit your GST / HST on monthly, quarterly or annually to the Government account, i.e. to Canada Revenue Agency (CRA) in Canada, to IRS in USA and to IRAS in Singapore. Additionally, you need to report GST / HST with the same frequency to the Government by way of filing GST / HST returns.