A Montreal business collected QST but claimed input credits on the wrong base, triggering a review. We rebuilt the filings and restored the credits.
Quebec Sales Tax is administered separately from GST/HST, and this business had been treating the two as a single combined filing. Input tax refunds on the QST side were claimed on the wrong base, which drew a Revenu Quebec review. We separated the GST and QST calculations, rebuilt the input claims for each on the correct base, and filed corrected returns. The review closed with the credits allowed in full.
E-commerce sits across provincial sales tax regimes, marketplace collection rules and inventory held in other jurisdictions.
Registration is mandatory once taxable supplies pass $30,000 over four consecutive calendar quarters. Input tax credits require documentation that scales with invoice size.
Why it bites: Unmatched input tax credits are the first thing disallowed in a sales-tax review, and the assessment covers every period reviewed.
A review is won on documentation created at the time, not on explanations offered afterwards. The CRA asks for the source records behind a figure, and an unsupported claim is simply disallowed.
Why it bites: Most reassessments we reverse are not the result of a wrong position — they are the result of a correct position with no contemporaneous paper trail behind it.
Every engagement above was priced as a fixed fee agreed before the work started, and paid only once the client had reviewed the result. If any of this looks like your situation, the first step is a free 15-minute call — we will tell you plainly whether there is anything worth doing.
Reviewed by Udit Gupta, Founder and Tax Accountant for the 2025 tax year. This case study is based on a real client engagement handled by Tax Filings Canada; the client's name and identifying details have been changed. Outcomes depend on your own facts.
Sources. CRA — GST/HST for businesses · CRA — GST/HST rates by province · Income Tax Act (Justice Laws Website)
