Applying a Tax Refund to the Payment of Tax Owing
You may want to use a GST/HST or QST refund or rebate (such as a refund of an amount of tax paid in error or a rebate for public service bodies) for a given period to offset the net GST/HST or QST payable for the same period. To do so, you must complete the appropriate application and file it along with your GST/HST or QST return.
If you file a single return for both the GST/HST and the QST, you can use a QST refund to offset GST/HST payable, and vice versa. In this case, you would remit the difference to us, or claim it as a refund, as applicable. However, we do not generally allow registrants to offset GST/HST payable using a QST refund in the following situations:
- The registrant has other debts to the federal or Québec government (even if a tax debt agreement has been reached).
- The registrant failed to file a return (i.e. a consumption tax return or a return under another law) for a previous reporting period.
You collected $1,200 in GST and $2,400 in QST. You are entitled to an input tax credit (ITC) of $1,750 and an input tax refund (ITR) of $150.
| GST collected | $1,200 | |
|---|---|---|
| ITC | − | $1,750 |
| Refund of net GST | ($550) | |
| QST collected | $2,400 | |
| ITR | − | $150 |
| Net QST payable | $2,250 | |
| Net QST to be remitted | $2,250 | |
| Refund of net GST | − | $550 |
| Amount of remittance | $1,700 | |
If you have branches or divisions that file separate GST/HST and QST returns, you can use the refund of one branch or division to offset the tax payable by another (GST/HST offset by QST, or vice versa). To offset the tax payable, you must file the returns of the branches or divisions at the same time.