As a registrant, you can generally recover the GST and QST you paid (or have to pay) on taxable property and services by claiming input tax credits (ITCs) and input tax refunds (ITRs).

The term inputs refers to property or services used or consumed in the course of your commercial activities.

Business inputs with regard to which you can claim ITCs and ITRs include:

• office furniture;
• computer systems;
• accountants' fees;
• taxi fares;
• machine repair costs;
• promotional items; and
• tools.

To be entitled to ITCs or ITRs, you must have been a registrant during one of the following reporting periods:

• the period in which the tax on the goods or services concerned is paid; or
• the period in which the tax becomes payable.

The making of exempt supplies, such as the supply of a long-term lease of a residential complex, is not a commercial activity. Consequently, you cannot recover the GST and QST paid on goods and services acquired in the course of such an activity.

The following do not give entitlement to ITCs or ITRs because they are not subject to GST or QST:

• salaries and wages;
• interest and dividends;
• insurance premiums;
• municipal taxes, provincial taxes (other than the QST) and federal taxes (other than the GST);
• most charges, fines and contributions.

Likewise, you cannot claim ITCs or ITRs on goods and services acquired for personal use.

You also cannot claim ITCs and ITRs with respect to membership fees or dues paid to an association whose main purpose is to provide recreational, dining or sporting facilities (including fitness clubs, golf clubs, and hunting and fishing clubs), unless you pay the fees or dues for the purpose of selling the membership because your commercial activity consists in supplying such memberships.

Since January 1, 2019, certain suppliers outside Québec and certain operators of digital platforms have been required to be Québec sales tax (QST) registrants and to collect QST in respect of certain taxable supplies made in Québec. Their QST registration numbers contain the letters "NR" (instead of the letters "TQ"). A list of the suppliers outside Québec who are QST registrants is available on our website.

Special rules apply when such suppliers or operators make certain taxable supplies in Québec or enable other persons to do so. For example, you cannot claim an ITR for the QST paid on property or a service purchased from such a supplier or operator, even if you acquired it for use in your commercial activities.

However, if you are a QST registrant and you are doing business with such a supplier or operator as part of your commercial activities, you can avoid paying the QST. Simply inform the supplier or operator that you are registered for the QST and give your registration number (beginning with “TQ”) before completing the transaction, and the supplier or operator will not have to collect QST on the property or service they supply. 

To determine whether the goods or services you acquire entitle you to ITCs and ITRs, ask yourself the following questions: