Paying GST in Canada is the same as in other nations. But, there are some specific schemes. The goods and services tax or the harmonized sales tax (GST/HST) credit, administered by the Canada Revenue Agency (CRA), is a tax-free sum paid four times yearly. It assists low – to – moderate-income individuals and families in offsetting all or a portion of their GST credit in Canada or HST payments.

Tax credits for GST/HST would double for the first six months under the new legislation, which amends the Income Tax Act. For the 2022–2023 tax year, this effectively doubles the maximum GST/HST credit amounts.

The quarterly GST credits will be increased for six months as part of the provisions enacted by Bill C-30 to assist low and moderate-income Canadians in dealing with excessive inflation.

Bill C-30 was approved by the House of Commons with unanimous support on October 6, 2022, and gained Royal Assent on October 18, 2022. According to the federal government, this $2.5 billion initiative will help 11 million people and families.

What Exactly Is The GST/HST Credit?

The GST credit in Canada, or HST credit, is intended to assist people and families with low or moderate incomes by balancing the amount of GST tax credit paid over the year. The Canada Revenue Agency (CRA) gives the tax-free credit weekly. You may be qualified for additional Canada sales tax by province and territorial credits in addition to the GST/HST credit.

How Much Do The Payments Cost?

The amount of money you may get is also determined by your net family income, as shown on your 2021 Canada goods and service tax return, as well as your marital status and number of children.

If you’re single, you may be eligible for up to the following:

• If you don’t have any children, the cost is $234.
• $387 for one kid
• $467 with two kids
• $548 for a family of three
• $628 for a family of four

If you’re married or have a common-law spouse, you may get up to –

• $306 if you do not have children.
• $387 for one kid
• $467 with two kids
• $548 for a family of three
• $628 for a family of four

You may find out how much you’re qualified for by logging onto the CRA’s My Account and looking for the most recent GST/HSTC notification under the “Mail” section. You may also use the CRA’s computation form to determine manually how much GST credit Canada you are qualified for.

Eligibility

If you’re a Canadian resident for income tax purposes the month before and at the beginning of the month the CRA pays, you may claim the GST/HST credit. One of the following must also be true:

• You’ve (or had) a spouse or common-law partner, you’re (or were) a parent, and you live (or lived) with your kid.
• The minimum age is nineteen (19).
• Parents may be entitled to half of that kid’s GST/HST credit in shared custody. This same holds for any provincial or territorial credit.

If, on the other hand, a child welfare agency is responsible for a kid (legally, physically, or financially), you will not be able to claim the GST rebate Canada credit for that child.

How Does The GST/HST Credit Work?

Your prior year’s Canada sales tax return determines your GST in Canada. The amount of your GST/HST credit payments is determined by your family’s net income and the number of children you have enrolled for the credit. Use the child and family benefits calculator to determine how much you could be eligible for.

The CRA may sometimes recalculate your GST/HST credit payment. The following situations may need a recalculation:

• Because of a reassessment, your family’s net income changes.
• your eligible kid reaches the age of 19
• Changes in your marital status
• Changes in the number of eligible children in your care
• When a recipient dies, you may begin or discontinue sharing custody of a kid.

Timeliness in reporting major life changes to the CRA is essential (i.e., your child is born or your marital status has changed). It will ensure that you get the appropriate compensation.

Bottom Line

Millions of Canadians awoke with hundreds of dollars from the federal government of Canada. It is due to the passage of Bill C-30, which doubles the GST credit Canada for 11 million Canadians for the next six months.

We are optimistic that after reading this blog, you have a fair idea of the GST credit system in Canada and how it works. However, you may want to know more and understand its nitty-gritty. In that case, it’s advisable to connect with experts like GJM & Co. Our accountants and experts will walk you through everything there is to know about GST credit in Canada.

Should you have any queries or need consultation, Schedule a Call today or write to us at info@gjmco.in.