How to Use GST/HST and QST Quick Methods for Simple Tax Filing — Montreal CPA Firm Near You

Introduction
Filing GST/HST (Goods and Services Tax / Harmonized Sales Tax) and QST (Quebec Sales Tax) can be time-consuming for small businesses. The Quick Method of Accounting is an approved simplified filing system that allows qualifying small businesses to remit only a portion of the tax collected, instead of tracking Input Tax Credits (ITCs) and Input Tax Refunds (ITRs) on every expense.

At Mackisen CPA Montreal, we help entrepreneurs and professional service firms use the Quick Method to save time, reduce administrative work, and often improve cash flow. This guide explains how the GST/HST and QST Quick Methods work, who qualifies, and how to apply them correctly for simplified, stress-free filing.

Legal and Regulatory Framework
The Quick Method is authorized by:

• Excise Tax Act (Canada) s.227(1) — allows small suppliers to remit tax using a fixed remittance rate.

• Excise Tax Act Regulations (Division V.1) — detail Quick Method rates and eligibility.

• Taxation Act (Quebec) s.407(1) and Regulation 107R4 — apply the same rules for QST.

• Revenu Québec Administrative Bulletin TVQ.206.3 — explains provincial application and remittance rates.

These rules let small businesses calculate taxes owing based on a percentage of taxable sales, rather than actual GST/QST collected minus ITCs/ITRs.

1. Understand the Quick Method Concept

Under the Quick Method:

• You still charge GST/QST to your customers at the normal rates (5% and 9.975%).

• You remit a reduced rate to CRA and Revenu Québec.

• The difference between what you collect and what you remit is yours to keep — it’s considered an allowance for the ITCs/ITRs you’re not claiming.

Example:
You invoice $100,000 + GST (5%) + QST (9.975%) = $114,975 collected.
Instead of tracking ITCs/ITRs, you remit only:

• GST: 3.6% of taxable sales (instead of 5%)

• QST: 7.0% of taxable sales (instead of 9.975%)
  Your business keeps the difference.

2. Determine If You Qualify for the Quick Method

To be eligible, your business must:

• Have worldwide annual taxable revenues under $400,000 (before tax).

• Be a GST/QST registrant engaged primarily in taxable activities.

• Not be a financial institution, charity, or public service body.

Common eligible businesses:

• Consultants, designers, IT specialists, accountants.

• Small retailers and tradespeople.

• Professional service firms (law, marketing, engineering).

Ineligible businesses:

• Financial institutions.

• Charities or non-profits using other rebate systems.

• Businesses that regularly import goods or claim large ITCs/ITRs.

3. Elect to Use the Quick Method

You must file an election before you can start using the Quick Method:

• For CRA (GST/HST): File Form GST74 – Election and Revocation of an Election to Use the Quick Method of Accounting.

• For Revenu Québec (QST): File Form FP-2074 – Election or Revocation of the Quick Method of Accounting for QST.

Once approved, your election takes effect on the first day of your next reporting period and remains valid until you revoke it or exceed eligibility limits.

4. How to Calculate Taxes Under the Quick Method

You continue to charge regular GST (5%) and QST (9.975%) to customers.
At filing time, you apply the Quick Method remittance rates to your total taxable sales.

Example for a Quebec-Based Service Business:

You effectively retain $4,874 as your “credit allowance” for not claiming ITCs/ITRs individually.

5. Claim the 1% Quick Method Credit

To encourage small business compliance, CRA and Revenu Québec offer a 1% credit on the first $30,000 of taxable sales each fiscal year.

How to apply it:

• Deduct 1% of your first $30,000 in sales from your GST/QST remittance.

• Example: $30,000 × 1% = $300 Quick Method Credit.

This further reduces your taxes payable.

6. How to File GST/QST Returns Using the Quick Method

When filing:

• Report total sales (before tax) on the regular lines for GST and QST.

• Apply your reduced remittance rates to those totals.

• Do not include ITCs/ITRs for regular business purchases (except for certain capital assets).

Forms:

• GST: File using CRA Form GST34 or your online My Business Account portal.

• QST: File using Form FPZ-500-V or the Mon Dossier portal.

Remit:

• The reduced GST and QST amounts calculated using Quick Method rates.

7. When the Quick Method Is Advantageous

The Quick Method can increase profitability and reduce workload if your business:

• Has low taxable expenses (few ITCs/ITRs to claim).

• Incurs mostly non-taxable costs (salaries, rent, insurance).

• Wants to simplify recordkeeping and minimize administrative time.

Not suitable if you:

• Have large capital purchases with high QST/GST.

• Operate in manufacturing or wholesale with high inventory costs.

Mackisen Tip: We run a detailed cost-benefit analysis for each client to ensure the Quick Method produces real tax savings before filing the election.

8. Track Your Records Even Under the Quick Method

Even with simplification, you must still keep:

• Sales invoices showing GST and QST charged.

• Proof of tax remittances and return confirmations.

• Supplier invoices for large capital assets (eligible for ITCs/ITRs).

• CRA and Revenu Québec election confirmations.

Revenu Québec can audit Quick Method users to confirm the accuracy of reported sales and rates.

Jurisprudence and Legal Insight
Courts have affirmed that using the Quick Method does not reduce documentation obligations:

• Canderel Ltd. v. Canada (SCC 1998) — all filings must reflect actual commercial reality.

• Lac d’Amiante du Québec Ltée (SCC 2001) — Revenu Québec can request supporting records for any return.

• Hickman Motors Ltd. v. Canada (SCC 1997) — taxpayers bear the burden of proving compliance.

Even under simplified methods, accuracy and documentation remain mandatory.

9. Review Annually to Ensure Ongoing Eligibility

You must exit the Quick Method if:

• Your annual taxable sales exceed $400,000 (before tax).

• Your business type becomes ineligible (e.g., financial institution).

• You choose to revert to the regular method for better ITC recovery.

To revoke, file:

• CRA Form GST74, and

• Revenu Québec Form FP-2074, marking the revocation option.

Mackisen Tip: Review annually with your CPA to confirm whether the Quick Method still benefits your business.

Winning With CRA and Revenu Québec
At Mackisen CPA Montreal, we simplify your GST/QST filings through expert implementation of the Quick Method:

1. Eligibility Assessment – We confirm that your business qualifies and will benefit financially.

2. Election Filing – We handle CRA and Revenu Québec Quick Method registration forms.

3. Rate Calculation – We determine the correct remittance rates and apply credits.

4. Training – We educate your accounting staff on how to apply the method accurately.

5. Audit Protection – We maintain compliance documentation and represent you if audited.

Mackisen Service Hub: Simplified Tax Filing for Small Businesses
Our Mackisen Service Hub provides comprehensive GST/QST management for small and medium-sized enterprises:

• Quick Method analysis and implementation.

• Filing and remittance management.

• Audit-ready recordkeeping systems.

• Ongoing advisory to ensure compliance and savings.

Our bilingual CPA auditors and tax lawyers — trained at McGill, Université de Montréal, and Concordia University — make simplified tax filing truly simple.

Real Client Example
A Montreal design consultancy with $220,000 in annual sales switched to the Quick Method under Mackisen’s advice. Their tax remittance dropped by $6,200 annually, and their filing time was reduced by 75%. Mackisen CPA filed both election forms and automated the firm’s quarterly filings.

Why Mackisen
With over 35 years of combined CPA and legal experience, Mackisen CPA Montreal ensures small businesses take full advantage of simplified GST/QST filing systems like the Quick Method.

When you file with Mackisen, compliance becomes effortless — and tax season becomes an opportunity for savings, not stress.