How to calculate the amount of the GST/HST you are considered to have collected

The amount of the GST/HST you are considered to have collected on a taxable benefit is based on a percentage of the value of the benefit for GST/HST purposes. The percentage rate you use depends on:

  • the province or territory in which the employee ordinarily reported to work
  • if you are a large business on December 31, 2021, for the purpose of the recapture of input tax credits for the provincial part of the HST
  • if the benefit is an automobile operating expense benefit or some other type of benefit

Value of the benefit

The value of the benefit for GST/HST purposes is the total of the following two amounts:

  • the amount reported on the T4 or T4A slip for the benefit
  • if the taxable benefit is for a standby charge or the operating expense of an automobile, the amount, if any, that the employee or the employee's relative reimbursed you for that benefit

Note

When an employee or an employee's relative has reimbursed an amount equal to the entire taxable benefit for a standby charge or the operating expense of an automobile and, as a result, no benefit is reported on the T4 slip, the value of the benefit for GST/HST purposes is equal to the amount of the reimbursement.

Automobile operating expense benefits

If the last establishment where your employee ordinarily worked or to which they ordinarily reported in the year is located in a participating province (Prince Edward Island, New Brunswick, Newfoundland and Labrador, Nova Scotia, or Ontario), you are considered to have collected an amount equal to a percentage of the value of the benefit for GST/HST purposes, based on one of the following rates:

  • 11% for Prince Edward Island, or 10.2% if you are a large business on December 31, 2021, for the purposes of the recapture of input tax credits for the provincial part of the HST
  • 11% for Nova Scotia, New Brunswick, and Newfoundland and Labrador
  • 9% for Ontario

If the last establishment where your employee ordinarily worked or to which they ordinarily reported in the year is located in a non-participating province or territory (the rest of Canada), you are considered to have collected 3% of the value of the benefit for GST/HST purposes.

Benefits other than automobile operating expense benefits

If the last establishment where your employee ordinarily worked or to which they ordinarily reported in the year is located in a participating province, you are considered to have collected, for 2021, the GST/HST as a percentage of the value of the benefit as follows:

  • 14/114 for Nova Scotia, New Brunswick, Prince Edward Island, and Newfoundland and Labrador 
  • 12/112 for Ontario

If you are, or were, a large business, and the benefits relate to a motor vehicle that was subject to the recapture of input tax credits (RITC) for the provincial part of the HST paid or payable on that vehicle you are considered to have collected, for 2021, the GST/HST as a percentage of the value of the benefits as follows:

  • 4/104, if the recapture rate was 100% on the last day of the last reporting period in which you reported the RITC for the provincial part of the HST paid or payable on that motor vehicle
  • 6/106, if the recapture rate was 75% on the last day of the last reporting period in which you reported the RITC for the provincial part of the HST paid or payable in Ontario on that motor vehicle
  • 6.5/106.5, if the recapture rate was 75% on the last day of the last reporting period in which you reported the RITC for the provincial part of the HST paid or payable in Prince Edward Island on that motor vehicle
  • 8/108, if the recapture rate was 50% on the last day of the last reporting period in which you reported the RITC for the provincial part of the HST paid or payable in Ontario on that motor vehicle
  • 9/109, if the recapture rate was 50% on the last day of the last reporting period in which you reported the RITC for the provincial part of the HST paid or payable in Prince Edward Island on that motor vehicle
  • 10/110, if the recapture rate was 25% on the last day of the last reporting period in which you reported the RITC for the provincial part of the HST paid or payable in Ontario on that motor vehicle
  • 11.5/111.5, if the recapture rate was 25% on the last day of the last reporting period in which you reported the RITC for the provincial part of the HST paid or payable in Prince Edward Island on that motor vehicle
  • 12/112, if the recapture rate was 0% on the last day of the last reporting period in which you reported the RITC for the provincial part of the HST paid or payable in Ontario on that motor vehicle
  • 14/114, if the recapture rate was 0% on the last day of the last reporting period in which you reported the RITC for the provincial part of the HST paid or payable in Prince Edward Island on that motor vehicle

If the last establishment where your employee ordinarily worked or to which they ordinarily reported in the year is located in a non-participating province or territory, you are considered to have collected 4/104 of the value of the benefit for GST/HST purposes as calculated above.

However, when an employee or an employee's relative has reimbursed an amount for a taxable benefit other than for a standby charge or the operating expense of an automobile, this reimbursed amount is consideration for a taxable supply. You are considered to have collected an amount equal to 5/105 for GST or one of the following for HST on a reimbursement:

  • 15/115 for Nova Scotia, New Brunswick, Prince Edward Island, and Newfoundland and Labrador
  • 13/113 for Ontario

In this situation, you have to include the GST/HST for this reimbursement in your GST/HST return for the reporting period that includes the date of the reimbursement. Additional information on the GST/HST implications on taxable benefits (other than automobile benefits) can be found in GST Memorandum 9.1, Taxable Benefits (Other than Automobile Benefits).

Report a problem or mistake on this page
Please select all that apply:

Thank you for your help!

You will not receive a reply. For enquiries, contact us.

Date modified: