Insights
Nov 12, 2025
Mackisen
How to Understand Your GST/HST Return Line by Line — Montreal CPA Firm Near You
Introduction
Filing your GST/HST (Goods and Services Tax / Harmonized Sales Tax) return may seem simple but understanding what each line truly means is essential for accuracy and compliance. Every line on your CRA GST/HST return form (Form GST34 or GST62, depending on your filing method) carries specific financial and legal implications. A single mistake even a misplaced figure can trigger penalties, interest, or a CRA audit.
At Mackisen CPA Montreal, we guide business owners step-by-step through their GST/HST returns to ensure every entry reflects commercial reality and aligns perfectly with your accounting records. This comprehensive guide explains each line of the GST/HST return, what it means, and how to report it correctly.
Legal and Regulatory Framework
The Excise Tax Act (Canada) governs GST/HST compliance:
s.225–s.228 — outlines the reporting and remittance obligations of registrants.
s.296 — gives CRA authority to reassess returns with errors or missing data.
s.280(1) — imposes daily compounded interest on late payments.
CRA Form GST34 (or GST62) — standard return form for electronic or paper filings.
Your GST/HST return is a legal declaration — and once submitted, it becomes an official record of your taxable activities for that reporting period.
Step-by-Step: Understanding Your GST/HST Return Line by Line
Section A — Information Section
This section includes your Business Number (BN), reporting period, and due date.
Box 100 – Total Sales and Other Revenue
Enter your total taxable supplies, including sales, commissions, and other income before tax.
Include zero-rated sales (exports, basic groceries, prescription drugs).
Exclude exempt sales (residential rent, financial services).
Tip: This line should match your income reported in your accounting software.
Section B — Calculating Net Tax
Box 101 – Total Sales and Other Revenue (Again)
This box repeats Box 100. It’s required for consistency and CRA cross-verification.
Box 103 – GST/HST Collected or Collectible
Enter the total GST/HST you charged on sales during the period — whether or not you’ve received payment yet.
Include all taxable invoices issued, even unpaid ones.
For e-commerce sales or digital services, ensure proper rates are applied (5% GST or appropriate HST rate).
Box 104 – Adjustments to GST/HST Collected
Record increases or reductions in tax due to:
Credit notes, discounts, or returns.
Bad debt write-offs or recoveries.
Price adjustments or exchange rate changes.
Note: A negative adjustment (refund or discount) reduces your GST/HST payable.
Box 105 – Total GST/HST Collected and Adjustments
Add Boxes 103 and 104.
This represents your total tax liability before claiming credits.
Section C — Input Tax Credits (ITCs)
Box 106 – Input Tax Credits (ITCs)
Enter the GST/HST you paid on eligible business purchases and expenses.
Only include expenses used in your commercial activities (not personal use).
Invoices must show valid supplier GST/HST registration numbers.
Examples:
Rent, utilities, advertising, supplies, software, and subcontractors.
Pro Tip: Don’t claim ITCs for:
Meals and entertainment (50% limit).
Passenger vehicles used for both business and personal purposes (partial eligibility).
Box 107 – Adjustments to ITCs
Report any corrections or adjustments to prior ITC claims, such as canceled purchases or overclaims.
Section D — Calculating Net Tax
Box 108 – Total ITCs and Adjustments
Add Boxes 106 and 107.
Box 109 – Net Tax
Subtract Box 108 from Box 105.
If positive: You owe this amount to CRA.
If negative: You are entitled to a refund.
This is your key remittance figure — CRA audits often focus here.
Section E — Payment and Refund
Box 110 – Instalments/Payments Made
Enter any prior payments you made for this filing period.
Box 111 – Total Balance Owing
Subtract Box 110 from Box 109.
This is the final amount you owe.
Box 112 – Refund Claimed
If Box 109 is negative, enter the refund amount here.
CRA typically processes refunds within 10–15 business days if filed electronically.
Additional Lines (as applicable):
Box 113A/113B – HST Provincial Components (for businesses in HST provinces).
Box 114 – Self-Assessed Tax on Imported Services (if you purchased digital services from abroad).
Box 115 – Total Tax Adjustments (rarely used; for CRA-authorized corrections).
Common Errors to Avoid
Confusing Zero-Rated and Exempt Sales:
Zero-rated = taxable at 0%, report in Box 100.
Exempt = not taxable, do not report in Box 100.
Missing Supplier Tax Numbers:
CRA denies ITCs without proper GST/HST registration numbers.
Double-Claiming ITCs:
Claim each expense once, in the correct reporting period.
Omitting Credit Notes:
Always reduce GST/HST collected when issuing refunds or discounts.
Late Filing or Payment:
CRA charges interest daily and late penalties under Excise Tax Act s.280(1).
Jurisprudence and Legal Insight
Canadian courts consistently uphold strict documentation and accuracy requirements:
Hickman Motors Ltd. v. Canada (SCC 1997) — taxpayers bear the burden of proving the correctness of their filings.
Canderel Ltd. v. Canada (SCC 1998) — financial filings must reflect commercial reality.
Royal Bank of Canada v. The Queen (FCA 2012) — CRA may deny ITCs if invoices or records are incomplete, even if expenses are legitimate.
These cases reinforce that accurate, well-documented filings are your best defense against reassessment.
Documentation: Keep Every Record for Six Years
Under Excise Tax Act s.286 and Tax Administration Act s.34, you must retain:
Sales invoices with GST/HST shown separately.
Supplier invoices showing GST/HST paid and registration numbers.
Bank proof of payments.
Credit notes and refunds.
CRA filing confirmations and Notices of Assessment.
At Mackisen CPA Montreal, we prepare a GST/HST Filing Binder for every client, linking each box on the return to its supporting documentation for audit readiness.
How CRA Audits GST/HST Returns
Auditors focus on:
ITC validity (supplier tax numbers and business-use proof).
Consistency between sales, income tax, and banking records.
Large refunds or unusual patterns in ITCs.
Late or amended returns.
Providing organized, line-by-line documentation helps close audits quickly and avoid adjustments.
Winning With CRA
At Mackisen CPA Montreal, our step-by-step filing approach ensures accuracy and peace of mind:
Pre-Filing Reconciliation – We verify all data matches your accounting records.
ITC Validation – We confirm supplier registration and eligibility.
Accurate Return Preparation – We complete and review every box for errors.
Electronic Filing & Confirmation – We submit via CRA’s My Business Account.
Audit Defense – Our CPA auditors and tax lawyers handle any CRA inquiries.
Mackisen Service Hub: Expert GST/HST Filing Management
Our Mackisen Service Hub provides complete GST/HST compliance services:
Return preparation and filing.
Recordkeeping and reconciliation.
Refund monitoring and CRA correspondence.
Audit preparation and representation.
Our bilingual team CPA auditors, tax lawyers, and compliance specialists trained at McGill, Université de Montréal, and Concordia University ensures every client’s filings are legally accurate and fully documented.
Real Client Example
A Montreal consulting firm filed multiple GST returns incorrectly by treating exempt sales as taxable. CRA reassessed $22,000 in over-remitted tax. Mackisen CPA reviewed all returns, filed adjustments under Excise Tax Act s.296(2), and secured a full refund with interest.
Why Mackisen
With more than 35 years of combined CPA and legal experience, Mackisen CPA Montreal ensures your GST/HST filings are correct, complete, and audit-proof. We help you understand every line, file confidently, and maintain flawless compliance with CRA requirements.
When you work with Mackisen, every number on your GST/HST return tells the truth precise, documented, and protected by professional expertise.
