Do I Need to Register for GST/HST? – A Complete Guide by a Montreal CPA Firm Near You

Introduction

One of the first and most important questions new entrepreneurs, freelancers, and small business owners ask is: Do I need to register for GST/HST?
Canada’s GST/HST registration rules are simple on paper but misunderstood in practice. Many businesses don’t realize they are legally required to register once they cross the $30,000 small supplier threshold, while others register too early and create unnecessary compliance obligations. Some businesses mistakenly charge GST/HST without being registered—an offence that triggers CRA penalties. Whether you are a consultant, e-commerce seller, contractor, gig worker, or service provider, understanding when GST/HST registration becomes mandatory is essential for compliance and avoiding costly reassessments.

Legal and Regulatory Framework

GST/HST registration requirements are governed by the Excise Tax Act. Every person (including individuals, partnerships, and corporations) must register for GST/HST if:

1. Small Supplier Threshold

You are not a small supplier if your worldwide taxable revenues exceed $30,000 in a rolling 4-quarter period.
Once you exceed $30,000:
• GST/HST registration becomes mandatory, and
• you must begin charging GST/HST on the very next invoice.

This threshold applies to:
• freelancers
• contractors
• consultants
• gig workers
• e-commerce sellers
• incorporated or unincorporated businesses
• partnerships

2. Immediate Mandatory Registration for Rideshare Drivers

Regardless of income, rideshare drivers (Uber, Lyft, etc.) must register from the first dollar earned.

3. Voluntary Registration

A business may voluntarily register even before hitting $30,000. Benefits include:
• ability to claim input tax credits (ITCs),
• improved credibility with corporate clients, and
• easier scaling for fast-growing businesses.

But voluntary registration comes with GST/HST filing obligations.

4. Exempt Activities

Some services are exempt, meaning GST/HST is not charged, even if revenues exceed $30,000:
• certain health services
• daycare
• financial services
• long-term rentals

These rules form the legal foundation determining whether you must register for GST/HST in Canada.

Key Court Decisions

Several court cases highlight strict enforcement of registration rules.

In Walls v. Canada, CRA successfully reassessed a consultant who exceeded $30,000 but failed to register on time. The court upheld CRA’s authority to assess uncollected GST/HST.

In Cornwallis Financial Corp. v. Canada, the Federal Court ruled that misclassifying exempt supplies results in full GST/HST liability.

In Air Canada v. Canada, the Supreme Court confirmed that GST/HST is a strict liability tax—businesses must remit amounts that should have been charged, even if the failure was unintentional.

In Revenu Québec v. HomeAway, remote sellers were required to register because they supplied taxable services to Québec consumers.

These decisions show that CRA consistently enforces GST/HST registration obligations.

Why CRA Targets This Issue

CRA aggressively audits GST/HST compliance because registration mistakes are common. CRA targets:

• businesses exceeding $30,000 in revenue without a GST/HST account
• unregistered businesses charging GST/HST illegally
• businesses collecting tax but not remitting it
• incorrect GST/HST reported on interprovincial sales
• gig workers who ignore registration requirements
• e-commerce sellers selling across Canada without proper place-of-supply rules

CRA also cross-checks:
• T4A slips
• platform payouts (PayPal, Stripe, Etsy, Uber)
• bank deposits
• marketplace records
• provincial registries

Any inconsistency can trigger a GST/HST audit.

Mackisen Strategy

At Mackisen CPA Montreal, we ensure businesses register at the right time and stay compliant from day one. Our approach includes:

• determining whether registration is required or beneficial
• registering your GST/HST number with the CRA
• determining your filing frequency (annual, quarterly, or monthly)
• establishing invoicing templates with the correct tax rate
• calculating ITCs to reduce net tax payable
• ensuring your sales tax setup matches your business model (online, service, multi-province)
• correcting past non-compliance through voluntary disclosure if needed
• preparing and filing GST/HST returns on time

This structured system prevents CRA issues and facilitates smooth business growth.

Real Client Experience

A freelance designer hit $32,000 in revenue but never registered. CRA assessed uncollected GST/HST of nearly $4,000. We helped her register retroactively and negotiate a payment plan.

A rideshare driver assumed they were exempt due to low revenue. CRA reassessed for GST/HST from day one. We corrected filings and educated him on industry-specific rules.

An e-commerce seller shipped across Canada but charged GST incorrectly. CRA questioned the discrepancies. We implemented correct place-of-supply rules and corrected returns.

Common Questions

Business owners often ask whether the $30,000 limit resets annually. No—it is a rolling four-quarter threshold.
Others ask whether foreign clients require GST/HST. Exports are normally zero-rated.
Some ask whether voluntary registration is worth it. Often yes—if your clients can claim ITCs.
Another question: What if I exceed $30,000 mid-invoice? You must charge GST/HST on the next dollar earned.

Why Mackisen

With more than 35 years of combined CPA experience, Mackisen CPA Montreal helps freelancers, small businesses, and growing companies stay fully compliant with GST/HST rules. Whether you need to register, charge, remit, or fix past filings, our expert team ensures precision, transparency, and complete CRA protection.