GST and QST Rebates Payable to Employees and Partners

In some cases, employees or partners may not receive a reasonable allowance or a reimbursement to cover all the expenses they incur. They may also be required to report an allowance as income. In either of these situations, employees or partners may recover the GST they paid on expenses incurred in the course of their employment or partnership activities. The rebate is available to employees of registrant employers and partners in registrant partnerships even if the employees or partners deduct the employment or partnership expenses in their income tax return.

The rebate, which is equal to 5/105 of the allowable expenses, must be claimed by filing the Canada Revenue Agency form GST370, Employee and Partner GST/HST Rebate Application,within four years after the end of the year to which the expenses apply. Allowable expenses include travel expenses and meal expenses.

Under the QST system, employees and partners may also be entitled to a rebate of the QST corresponding to 9.975/109.975 of the allowable expenses incurred. The rebate must be claimed using form VD-358-V, Québec Sales Tax Rebate for Employees and Partners.

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