GST -HST question

saannto · Post by **saannto** » Wed Jan 19, 2011 3:15 pm

Hello,
I have collected 10000$ as GST for 2010 and i have paid 2500$ as GST to other incorporations (as Invoices) in 2010. so i owe 7500$ as GST to CRA.
But i have expenses like buying stuffs (computers/furnitures) for company and (car gas) should i include these GSTs i paid in that 7500$ that i owe and reduce and pay the rest to CRA?
say if i spent 1000$ GST to all the stuffs i paid, can i remit only 6500$? please let me know
THanks

nelsona · Post by **nelsona** » Wed Jan 19, 2011 3:22 pm

Canada/ US tax forum.

JGCA · Post by **JGCA** » Sun Jan 30, 2011 3:39 pm

Yes the GST , HST you payout on business related expenses are condisdered as eligible ITC and should be used as a reduction of net GST HST tax owing to the CRA, so claim them as a reduction of the $7,500 balance owed. Keep in mind you are subject to penalty and interest if you file late or have not made any installments on the GST HST unless this was your first year of operations but late filing penalty will apply so make sure you file the return and pay te amount due on time depending on your filing frequency.