Going into this video, I knew very little about HST or when business owners need to register to collect it. The only thing I really knew was that there is a $30,000 business income threshold and once this threshold reached, you’re required to register for HST.
Maybe you know that too… But, as with so many things, it’s a little more complicated than that. There are levels of taxation to consider in order to know which items are taxed with HST and which are not. And what about people who own multiple businesses?
Levels of Taxation
There are actually three levels of taxation under HST. These include, tax exempt, zero-rated, and taxable.
Basically, this means that you don’t ACTUALLY collect HST one everything you sell… It depends! (We give a few examples in this week’s video at the bottom of this page).
If you’re unsure about the level of taxation an item falls under, you can check out this website for more info on that.
Owning Multiple Businesses
Another thing to keep in mind, is that the $30,000 threshold applies per business owner and NOT per individual business. That means if you own multiple businesses, you need to consider the income from each of these when figuring out when you’ve hit the $30,000 mark and need to register to collect HST.
You need to be careful about this because there are some forms of income that count as business income that you may not think to include. (For example, if you AirBnB a property, that constitutes business income and it will count toward the $30,000 threshold).
Still a little confused? Don’t worry. We break it down even more in this video.
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