Close my GST/HST account

Video series: GST/HST Information for a New Small Business

Segment 17: Deregistering your GST/HST account

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The following explains how and when to close your GST/HST account:

How and when to close your GST/HST account

Once you are ready to close your GST/HST account, you will need to do the following:

Your obligations after closing your GST/HST account

Determine the GST/HST owing on non-capital property held at the time of closing

You are considered to have sold each property (other than capital property) you held for consumption, use, or supply in a commercial activity and to have collected GST/HST on such sales.

Remit the GST/HST on the fair market value of each of these properties just before you close your account. Report this GST/HST on your final return.

Determine the GST/HST owing on capital property held at the time of closing

You are considered to have sold using capital property you held for use in your commercial activities immediately before closing your GST/HST account and to have collected tax equal to the basic tax content of the capital property at that time.

Use the change in use rules for this property to determine if you have tax owing.

Include the tax you are considered to have collected in your net tax calculation on your final return. Generally, all or part of the ITCs previously claimed on this property have to be repaid.

See Change in use rules for capital real property and Change in use rules for capital personal property for more information.

Adjust your ITCs for services, rents, royalties, and similar payments at time of closing

You cannot claim ITCs for rent, royalties, or similar payments that relate to the period after you close your GST/HST account. You have to make an adjustment to your net tax calculation on your final return if you have claimed ITCs for the GST/HST paid or payable on these payments.

However, you can claim an ITC for the GST/HST that becomes payable after you close your GST/HST account for services, rent, royalties, or similar payments that relate to a period before you close that account.

File your final GST/HST return and remit any amount owing

When you close your account, you are considered to have two separate reporting periods. You may, therefore, have to file two returns as follows:

  • a return for a reporting period that ends the day before you close your GST/HST account; and
  • a second return for a reporting period that begins the day you closed your GST/HST account and ends on the last day of that month. This return is only required if you have tax to remit for that period.

Example

You are an annual filer with a reporting period of January 1 to December 31, 2014. You closed your business on October 21, 2014, and closed your GST/HST account on the same day. Send us:

  • a final return for the period January 1 to October 20, 2014, which is due November 20, 2014; and
  • an additional return if your business has tax to remit for the period October 21 to October 31, 2014, which is due November 30, 2014.
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