The GST/HST and the QST are not applied to a deposit. The GST/HST and the QST are calculated on the deposit only if the supplier applies the deposit as partial payment of the sale price of a good or service.
If the customer forfeits the deposit by not purchasing the item or service, taxes are considered to be included in the deposit.
Calculation of the GST and the QST
To determine the GST to be remitted on the forfeited deposit, multiply the amount of the deposit by 5/105.
To determine the QST to be remitted, multiply the amount of the deposit by 9.975/109.975.
Calculation of the HST
To determine the HST to be remitted on a forfeited deposit in a participating province, multiply the amount of the deposit by the fraction shown in the table below.
|Newfoundland and Labrador||15/1152|
|Prince Edward Island||15/1153|
- Fraction to be used for forfeited deposits as of July 1, 2016. The fraction to be used for forfeited deposits before that date is 13/113.
- See note 1.
- Fraction to be used for forfeited deposits as of October 1, 2016. The fraction to be used for forfeited deposits before that date is 14/114.
Customers who are registrants may claim an input tax credit (ITC) and an input tax refund (ITR) for the taxes deemed to have been paid on the forfeited deposit if they have supporting documents.