Celebrate Savings This Holiday Season: Temporary HST/GST Exemptions
The Canadian government is ushering in the festive season with two exciting financial benefits for Canadians: a GST Holiday and a potential $250 Working Canadians Rebate. Beginning December 14, 2024, a temporary GST/HST exemption will provide tax-free savings on essential items, and early in 2025, eligible working Canadians can expect a $250 rebate to help with rising living costs.
As always, YBL Accounting is here to help you understand these changes and how they impact your finances or business operations. Let’s break it down.
What is the GST Holiday?
The GST Holiday is a temporary suspension of the Goods and Services Tax (GST) and Harmonized Sales Tax (HST) on select items from December 14, 2024, to February 15, 2025. This measure aims to provide Canadians with much-needed financial relief during the holiday season and beyond.
Eligible Items for the GST Holiday Include:
- Prepared foods and restaurant meals
- Children’s clothing and shoes
- Diapers
- Children’s car seats and toys
- Books
- Christmas trees
For a complete list, visit the CRA website.
How Businesses Should Prepare
For businesses, implementing the GST Holiday is critical to ensure compliance and customer satisfaction. Here's what you need to know:
Point of Sale Systems: Work with your POS system provider to adjust GST/HST rates during the holiday period.
Third-Party Platforms: If you sell on platforms like Shopify or Amazon, confirm whether the platform will automatically apply the tax exemption or if manual changes are required.
Manual Invoicing: Businesses issuing invoices manually must ensure GST/HST is excluded on qualifying items during the holiday period.
Failing to adjust could lead to customer dissatisfaction or errors that require issuing rebates.
Rebates for Consumers Charged GST in Error
If a consumer is mistakenly charged GST on eligible items during the holiday, they can file for a rebate using Form GST189:
How to File for a GST Rebate
Complete the Form:
Part A: Fill in personal details.
Part B: Use reason code 1C (Amounts paid in error).
Part C: Provide transaction details.
Part E: Sign the form.
Attach Receipts: Include the original receipts showing incorrect charges (credit card/bank statements are not sufficient).
Mail to:
Summerside Tax Centre
275 Pope Road
Summerside, PE C1N 6A2
Important Notes:
Rebates must be claimed within four years of the incorrect charge.
Double-check your submission to avoid delays.
Navigating the GST Holiday as a Small Business
While the GST Holiday provides significant savings for consumers, it presents challenges for businesses to comply with the temporary tax rules. At YBL Accounting, we understand the operational strain short-term changes can create, especially for small businesses.
Here’s how we can help:
Ensure your accounting software or POS systems are correctly configured.
Assist with manual invoicing compliance.
Support with filing GST189 rebates on behalf of your customers if errors occur.
Conclusion
The GST Holiday and possible $250 rebate are welcome financial boosts for Canadians, but they also require careful implementation and tracking, especially for small businesses. YBL Accounting is here to guide you through these changes to ensure compliance, savings, and peace of mind.
If you have any questions about how these measures impact your personal or business finances, contact YBL Accounting today. We’re here to help you navigate the season’s financial opportunities with confidence.