Low-Cost Transaction Categorization for Canadian Businesses

CRA online filing for 2025 returns opened on 23 February 2026 and stays open until 29 January 2027. You can prepare a return before the service opens, but it cannot be transmitted, and slips such as T4s and T5s often arrive only in late February. Filing early makes sense if you expect a refund. If you expect a balance owing, you can still file early and pay by 30 April 2026.

A write-off is simply a deductible expense. You subtract it from the income it helped earn, so the saving equals the expense multiplied by your marginal tax rate, not the full amount spent. To qualify, the cost must be incurred to earn business or employment income, be reasonable in amount, and be backed by a receipt. Purely personal costs never qualify, and mixed-use items such as a vehicle or a home office are split by business-use proportion.

Yes. GST/HST you charge customers is collected on the government's behalf, so it sits as a liability until you remit it. Input tax credits on your purchases reduce that balance, and the net amount is what the GST/HST return reports. Record the tax in its own account at the point of sale; treating collected tax as revenue overstates sales and hides what you owe. Reconcile the account every filing period against the return.

The CRA can demand your records, and a court can order production. Anyone else, such as a landlord, lender, ex-spouse's lawyer or prospective employer, can ask, but only as a condition of dealing with you; you may refuse and accept that consequence. The CRA will not release your information to them without your authorisation. Where you need to prove income, a proof of income statement or notice of assessment from My Account usually satisfies them.

Yes. There is one combined GST/HST return, so HST you paid on business purchases is claimed as an input tax credit on the same return where you report the GST and HST you collected. The rate charged does not matter: GST 5%, Ontario HST 13%, Nova Scotia 14% from 1 April 2025, and 15% in New Brunswick, Newfoundland and Labrador and Prince Edward Island are all recoverable if the purchase relates to commercial activity. Keep invoices showing the tax and the supplier's registration number.

Yes. GST and HST are one federal tax, so a registrant claims tax paid anywhere in Canada on the same return, at whatever rate applied where the supply was made. An Alberta business billed 13% HST on an Ontario hotel stay recovers the full 13%, as long as the expense relates to commercial activity and the invoice shows the tax. Provincial retail taxes are different: British Columbia PST, Saskatchewan PST and Manitoba RST are costs, not credits.

Speculation and vacancy taxes are provincial and municipal, and they fall on the owner of residential property, not the buyer or tenant. British Columbia's speculation and vacancy tax applies in designated areas to owners who neither live in the home nor rent it out for enough of the year, with exemptions for a principal residence and certain tenancies, and owners must declare annually. Vancouver and Toronto run separate vacant home taxes.

Unbottled water is generally zero-rated as a basic grocery, so no GST/HST is charged on it while the supplier still claims input tax credits. Water sold as a beverage in single servings, such as a small bottle, is taxable at the ordinary rate for the province. Water supplied by a municipality falls under its own treatment. The line between these categories is narrow, so check the CRA's basic groceries memorandum for your exact product.

Paid parking from a commercial operator is a taxable supply, so GST/HST applies at the province's rate and is usually built into the posted price. The receipt or machine slip normally shows the tax and the operator's registration number, which a business needs before claiming an input tax credit. Parking provided to a tenant with a residential lease, and some parking supplied by public sector bodies, is exempt instead.

Yes, and you should file straight away. Returns can be filed long after the due date, and online filing for the 2025 tax year stays open until 29 January 2027. If you owe, a late-filing penalty is charged as a percentage of the balance plus a monthly amount, and interest runs from the payment due date, which was 30 April 2026 for 2025. If you are owed a refund or benefits, nothing is lost by filing late.

Because two different governments administer the two taxes. In British Columbia, Saskatchewan and Manitoba the CRA collects the 5% federal GST (the rate since 1 January 2008 and unchanged for both the 2025 and 2026 years) while the province collects its own PST or RST, each with a separate registration, filing frequency and deadline. Quebec is the exception: Revenu Quebec administers the 9.975% QST (the rate since 1 January 2013, current for 2025 and 2026) and also the GST for most Quebec-resident registrants, so they file one combined return.

You can file your own return without waiting for your spouse to file theirs, but you must still report their name, social insurance number and net income for the year, because income-tested credits and benefits are worked out on combined income. You may also prepare and send your spouse's return for them, provided they authorise it and review it first. Where their income is not final, use a careful estimate and correct it afterwards with a T1-ADJ.