Should you register?

On this page ...

• Small supplier
• Voluntary registration
• Date of registration
• Multibranch non-profit organizations
• Incorporated non-profit organizations
• Unincorporated non-profit organizations
• Grouping provisions

You have to register for GST/HST if you provide taxable supplies in Canada and you are not a small supplier. If you are a GST/HST registrant, you have to collect GST/HST on your taxable supplies of goods and services, and you can claim ITCs for the GST/HST you pay or owe on expenses to provide these taxable goods and services. You do not have to register if your only commercial activity is the sale of real property otherwise than in the course of a business or you are a non-resident person who does not carry on any business in Canada.

If you are a small supplier and decide not to register for GST/HST, you do not charge GST/HST to your customers and you cannot claim ITCs to recover the tax you pay or owe on your purchases and operating expenses.

Small supplier

Your non-profit organization is a small supplier in a particular calendar quarter and in the first month immediately following the particular calendar quarter if your worldwide revenues from taxable supplies are $50,000 or less in the previous four consecutive calendar quarters.

Note
If, during any one calendar quarter, your total worldwide revenues from taxable supplies are more than $50,000, you will immediately cease to be a small supplier and will have to register for GST/HST.

This amount includes zero-rated supplies but does not include sales of capital property, supplies of financial services, and certain payments for goodwill. You also have to include all your associates' revenues when you calculate your taxable supplies.

Voluntary registration

If you are a small supplier who is engaged in a commercial activity in Canada, you can choose to register voluntarily. If you choose to register voluntarily, you have to charge and remit GST/HST on your taxable supplies of goods and services, and you can claim ITCs to recover the GST/HST you pay or owe on purchases and operating expenses used in your commercial activities. You have to remain registered for at least one year before you can request to cancel your registration.

Date of registration

The effective date of your GST/HST registration depends on when you exceed the small supplier threshold amount. If you exceed the threshold amount in one calendar quarter, you are considered a registrant and must collect GST/HST on the supply that made you exceed the threshold amount. Your effective date of registration would then be the day the supply was made in which you exceeded the threshold amount. You will have 29 days from this day to apply for registration. However, if you do not exceed the threshold amount in one calendar quarter, but you exceed it over four consecutive calendar quarters, you are considered to be a small supplier for those four calendar quarters and a month following those quarters. Your effective date of registration would be the day the first supply was made after you cease being a small supplier. You will have 29 days from this day to register for GST/HST.

Multibranch non-profit organizations

Generally, if your non-profit organization is incorporated, you have to register as a single entity. However, if your non-profit organization is unincorporated, your branches or divisions may have to register separately if they are independent entities.

Incorporated non-profit organizations

If your non-profit organization is incorporated, you have to register for GST/HST as a single entity. Revenues from all branches and divisions have to be considered to determine if you have to register. You are also responsible for charging GST/HST on all taxable supplies made by them. Branches or divisions of an incorporated non-profit organization cannot register separately. GST/HST does not apply to supplies of goods and services between branches and divisions that are part of one corporation.

However, if your incorporated non-profit organization has branches and divisions, you may apply to have each branch or division designated as a small supplier division. A branch or division qualifies as a small supplier division under the following conditions:

• its worldwide revenues from taxable supplies are $50,000 or less in the previous four consecutive calendar quarters and in any particular calendar quarter;
• it is separately identifiable by either its location or the nature of its activities;
• separate records, books of account, and accounting systems are kept for it; and
• you have not revoked an earlier designation of the branch or division in the previous 365-day period.

When a branch or division is designated as a small supplier division, you do not collect GST/HST from taxable supplies made by the branch or division, and you cannot claim ITCs for the GST/HST paid or payable on purchases made by the branch or division.

If a branch or division no longer qualifies as a small supplier, you have to start collecting GST/HST on its supplies. If you are not registered for GST/HST, you have to do so. In addition, you will have to collect GST/HST on all supplies made by the branches or divisions that are not designated as small supplier divisions.

To apply for this designation, file Form GST31, Application by a Public Service Body to Have Branches or Divisions Designated as Eligible Small Supplier Divisions.

Unincorporated non-profit organizations

If your non-profit organization is not incorporated and it has several branches or divisions, we may consider them to be separate entities for GST/HST purposes. Each branch or division that is considered a separate entity has to register separately if it is not a small supplier.

To determine if a branch or division is a separate entity that should register separately, consider the following factors:

• Legal basis: Are the constitution and by-laws of the branch or division different from those of the parent body? Does the constitution define the activities the branch or division carries out? Can it sue or be sued? Can it hold property or contract in its own name? Is it liable for its debts? Does it raise its revenues instead of receiving funding from the parent body?
• Management structure: Do the parent body and its branches or divisions have different managers or directors? Can the branch or division make financial and operational decisions without the approval of the parent body? Does it have separate accounting systems and a different fiscal year-end from the parent body?

If each branch or division of an unincorporated organization registers separately, GST/HST applies to taxable supplies between them.

Grouping provisions

To avoid having each club or association that is a member of a larger organization register individually, two unincorporated organizations can apply to have one of the two organizations considered to be a branch of the other. The two organizations can apply using Form GST32, Application to Deem One Unincorporated Organization to be a Branch of Another Unincorporated Organization. If the application is approved, we then consider the two organizations to be one entity and one registrant for GST/HST purposes. No GST/HST will apply to transfers of goods and services between the member organization and the main organization.

  Previous page | Table of contents | Next page