Filing GST/HST and QST Returns (Monthly vs Quarterly)

Introduction
Understanding filing GST/HST and QST returns is essential for corporations, freelancers, consultants, retail businesses, e-commerce sellers, contractors and anyone registered for sales tax in Canada. Once a business registers for GST/HST or QST, it must file returns regularly—monthly, quarterly or annually—depending on revenue and CRA or Revenu Québec requirements. Mistakes in filing frequency, late remittances or incorrect reporting can lead to penalties, interest and even audits. Québec adds a separate provincial obligation that must be filed independently from GST/HST, increasing the complexity for businesses operating in the province. This guide provides a complete explanation of filing GST/HST and QST returns, choosing the correct frequency, and staying compliant year-round.

Legal and Regulatory Framework
Filing GST/HST and QST returns is governed by the Excise Tax Act and Québec’s Taxation Act. When a business registers for sales tax, CRA assigns a filing frequency based on annual taxable sales, while Revenu Québec issues its own filing frequency for QST.

Common filing periods:

• Monthly — usually for businesses with over $1.5 million in annual sales
• Quarterly — for businesses with mid-range sales
• Annually — for small businesses or voluntary registrants

Even if filing annually, businesses may still be required to remit GST/HST or QST installments throughout the year depending on net tax payable.

Each return must include:

• total taxable sales
• GST/HST/QST collected
• GST/HST/QST paid (ITCs or ITRs)
• adjustments, credits and refunds
• required remittances

Understanding filing GST/HST and QST returns ensures full compliance with both federal and provincial systems.

Key Court Decisions
Court rulings emphasize the importance of timely and accurate filing GST/HST and QST returns. Major principles include:

• late GST/QST payments generate interest automatically
• sales tax collected but not remitted is treated as trust money, creating serious liability
• incomplete records invalidate ITC and ITR claims
• filing frequency does not eliminate the need for proper documentation
• e-commerce deals must follow correct place-of-supply rules

Courts have consistently upheld CRA and Revenu Québec audits where businesses failed to maintain proper sales tax documentation. Québec judgments stress the province’s stricter stance on QST compliance.

Why CRA and Revenu Québec Target This Issue
CRA and Revenu Québec closely monitor filing GST/HST and QST returns because:

• sales tax is government-held trust money
• many small businesses file late or not at all
• incorrect ITC or ITR claims are common
• discrepancies appear between GST/HST returns and corporate tax filings
• e-commerce and online sales frequently misapply tax rules
• businesses often misunderstand filing frequency requirements

Audit triggers include:

• repeated late filings
• large GST/HST or QST refunds
• mismatched revenue on GST returns vs income tax returns
• rapidly growing sales
• missing documentation for ITC/ITR claims
• unusual fluctuations in net tax payable

Understanding filing GST/HST and QST returns properly prevents audit exposure and financial consequences.

Mackisen Strategy
Mackisen CPA provides a complete compliance system for filing GST/HST and QST returns:

• determining the correct filing frequency (monthly vs quarterly vs annual)
• registering and updating GST/HST and QST accounts
• setting up accurate sales tax codes in accounting software
• reconciling GST/HST/QST collected vs ITCs/ITRs
• reviewing sales tax treatment for interprovincial and international sales
• preparing and filing returns with CRA and Revenu Québec
• correcting past filings through voluntary disclosure
• assisting with CRA and Revenu Québec audits
• providing cash-flow planning for installment requirements

We ensure that businesses stay compliant with filing GST/HST and QST returns while optimizing refunds and minimizing tax risk.

Real Client Experience
Many clients come to Mackisen after receiving notices or assessments for filing GST/HST and QST returns incorrectly. One consultant filed annually but should have filed quarterly due to revenue growth. CRA assessed interest for late installments. We recalculated obligations and aligned filing frequencies.

A Québec retailer submitted inaccurate QST returns because sales tax codes in their POS system were misconfigured. Revenu Québec demanded corrections. Mackisen rebuilt QST records and refiled returns.

An online business charged GST but failed to file returns for two years. CRA issued estimated assessments. We prepared accurate returns and reduced penalties through VDP.

A contractor claimed high ITCs without receipts. CRA denied the credits. Mackisen organized documentation and reconstructed ITC claims. These examples show why filing GST/HST and QST returns must be done carefully.

Common Questions
Business owners frequently ask:

• Should I file monthly or quarterly?
CRA assigns frequency based on revenue; small businesses may request annual filing.

• Do I need to remit tax even if filing annually?
Sometimes—installments may apply.

• What happens if I file late?
Interest and penalties apply automatically.

• What if I make a mistake?
Returns can be amended or corrected.

• Do Québec businesses also file GST through CRA?
Yes, GST goes through CRA, QST through Revenu Québec.

• Do I need receipts to claim ITCs?
Yes—documentation is mandatory.

These questions clarify filing GST/HST and QST returns effectively.

Why Mackisen
With more than 35 years of combined CPA experience, Mackisen CPA Montreal helps businesses stay compliant while recovering the taxes they’re entitled to. Whether you're filing your first GST/QST return or optimizing multi-year refunds, our expert team ensures precision, transparency and protection from audit risk. When filing GST/HST and QST returns, Mackisen provides complete preparation, reconciliation, voluntary disclosure services and professional representation to safeguard your business.