Remit (pay) the GST/HST by instalments


Find out if you have to pay GST/HST by instalments

Special rules for first time filers explains how to determine if you need to pay the GST/HST by instalments in your second fiscal year.

If you are an annual filer and your net tax for your previous fiscal year is $3,000 or more, you may have to make quarterly instalment payments in the current fiscal year.

If your business has branches or divisions that file separate returns, the threshold limit of $3,000 applies to the total net tax for the whole business, including all branches and divisions.

Calculate your instalment payments

You can calculate your instalment payments online. To use the instalment payment calculator service, see My Business Account or Represent a client.

Determine how to calculate your GST/HST instalment payments based on your situation:

Special rules for the first time you file

Even If your net tax is less than $3,000 for your fiscal year, you may have to make instalment payments in your second fiscal year.

This might be the case if you are an annual filer, and your first year as a GST/HST registrant was shorter than 12 months.

If so, divide your net tax for that reporting period by the number of days you were registered in that fiscal year. Multiply this amount by 365 (number of days). If the result is $3,000 or more, and your net tax for your second year will also be $3,000 or more, you will have to make instalment payments in your second year.

Example 

You are a sole proprietor. Your first year as an annual filer began on October 13, 2017, and ended on December 31, 2017. Your net tax for those 80 days was $800.

To determine if you need to make instalment payments in 2018, calculate your annual net tax for 2017:

  • $800 (net tax for 2017) ÷ 80 (days) × 365 = $3,650 net tax for a full year

Your annual net tax 2017 is greater than the $3,000 threshold. You need to make equal quarterly instalment payments in 2018 if your 2018 net tax will also be $3,000 or more.

To base your instalment payments on your annual net tax for 2017, calculate the amount of each instalment payment:

  • $3,600 ÷ 4 = $900

You have 2 payments due on April 30, 2018:

  • your net tax of $800 for 2017
  • your first instalment for 2018 of $900

Base your instalment payments on the previous year

These quarterly payments are usually equal to one-quarter (¼) of your net tax from the previous year.

Example 

You are a business with a December 31 fiscal year-end. Your net tax for the 2017 fiscal year was $4,000.

We will calculate your quarterly instalments at $1,000 each ($4,000 ÷ 4).

Your first instalment is due April 30, 2018.

Base your instalment payments on the current year

You may also choose to base your quarterly instalment payments on an estimate of your net tax for the current year if you expect that it will be less than it was for the previous year.

However, if you estimate your instalments based on your current year and the instalment payments you make are less than the amount you actually should have paid, we will charge instalment interest on the difference.

When to pay 

Instalment payments are due within one month after the end of each of your fiscal quarters. To view your instalment due dates online, use the instalment payment calculator service at My Business Account or at Represent a client.

When a due date falls on a Saturday, a Sunday, or a public holiday recognized by CRA, we consider your payment to be paid on time if we receive it on the next business day.

Example

You have a December 31 fiscal year-end. Your instalment due dates are as follows:

  Instalment due dates
Fiscal Quarters Instalment due dates
January 1 to March 31 April 30
April 1 to June 30 July 31
July 1 to September 30 October 31
October 1 to December 31 January 31

How to pay

To make your GST/HST instalment payments, use Form RC160, Remittance Voucher – Interim Payments. This form is only available in a personalized and printed format. You still have to make your payment by the due date even if you do not receive your remittance form on time. To order Form RC160, see Order remittance vouchers or payment forms.

To make instalment payments electronically, you may use your financial institution’s online or telephone banking services. You do not need a remittance voucher to pay online.

Another way to make instalment payments electronically is to use My Payment. This service allows you to make payments online from your account at a participating Canadian financial institution.

You may authorize the CRA to withdraw a pre-determined payment from your bank account on specific dates. To authorize this agreement, use My Business Account.

Report instalment payments on your GST/HST return

When you file your GST/HST return at the end of the fiscal year, report the instalment payments you made throughout the year on line 110 of your return.

Generally, if the instalments you paid are less than your net tax, you have to remit the difference. If the instalments you paid are more than your net tax, you can claim the difference as a refund.

Special rules for select financial institutions

Special rules apply to instalment payments that are made by selected listed financial institutions. For more information, see Guide RC4050, GST/HST Information for Selected Listed Financial Institutions.

 

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