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Published | Categories : GST and QST, Better tax practices – businesses

Individuals in Business: Registering for the GST and the QST

Generally speaking, sales of property or services in Québec that are made by individuals in business are taxable under the goods and services tax (GST) and Québec sales tax (QST) systems. Therefore, such individuals are required to register for the GST and the QST.

They are also required to collect GST and QST and remit them to us. Form FP-500-V, Detailed Calculations, and form FPZ-500-V, GST/HST – QST Return, are to be used by such individuals to calculate and report the taxes.

In addition, they can claim input tax credits (ITCs) and input tax refunds (ITRs) with regard to the GST and the QST paid in respect of property and services acquired by them to make taxable (including zero-rated) sales of property or services.

Small suppliers

Any individual in business whose total taxable sales do not exceed $30,000 in a given calendar quarter and in the combined four calendar quarters preceding that given calendar quarter is considered a small supplier. The sales referred to are those made worldwide by the individual in business and his or her associates during those periods.

Individuals in business who are considered small suppliers are not required to register for the GST and the QST and do not have to collect or remit those taxes. Also, they cannot claim ITCs or ITRs with regard to the taxes paid in respect of their purchases.

However, small suppliers may choose to register for the GST and the QST, in which case they are required to collect the taxes and remit them to us. Such small suppliers can claim ITCs and ITRs with regard to the taxes paid in respect of their purchases.

Example

An individual sells used property online. His total sales in the combined four calendar quarters preceding a given calendar quarter exceed $30,000. He is required to register for the GST and the QST and to collect those taxes.

In some situations, an individual in business may be required to register for the GST and the QST regardless of the total amount of the individual's taxable sales. For more information in that regard, click on the following links: Registering for the GST and QST and Mandatory QST Registration.

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