What to Do If You Forgot to Register for QST on Time

Many Quebec businesses especially freelancers, consultants, retailers, online sellers, and fast-growing startups accidentally cross the $30,000 small supplier threshold without realizing it. Others simply misunderstand the rules and assume QST registration isn’t required until they “get bigger.”
Unfortunately, Revenu Québec does not accept ignorance as an excuse. Failing to register on time can lead to retroactive tax owing, penalties, interest, and even audits.

The good news: the situation is fixable if you act strategically and quickly.
This guide explains exactly what to do if you forgot to register for QST when you were required to.

Step 1 — Confirm When You Crossed the $30,000 Threshold

You must register when your worldwide taxable revenues exceed:
• $30,000 in the last four consecutive calendar quarters, OR
• $30,000 in a single calendar quarter

Review:
• invoices
• bank deposits
• e-commerce reports
• Stripe/PayPal statements
• bookkeeping records

Identifying the exact quarter, you crossed the threshold is essential.

Step 2 — Register for QST Immediately

Even if you are late, register now through:
• Revenu Québec’s online portal
• the paper form FP-518
• your CPA

Registration stops further non-compliance and prevents the issue from snowballing.

Step 3 — Determine How Much QST You Should Have Collected

Once you determine the date you should have registered, calculate:
• QST you should have charged
• QST you collected (if any)
• QST you must remit out of pocket

If customers already paid invoices without QST, you cannot force them to pay retroactively — meaning the QST becomes your expense unless they voluntarily agree to pay.

Step 4 — Decide Whether to Issue Corrected Invoices

You have two options:

Option A — Issue corrected/supplemental invoices

You send the client:
• a revised invoice including QST, or
• a supplemental invoice for QST only

But clients are not obligated to pay.

Option B — Treat past invoices as tax-included

This is the most common solution.
You calculate embedded QST and remit it yourself.

Formula:
QST = Total price ÷ 1.09975 × 0.09975

This avoids customer disputes.

Step 5 — File Backdated GST/QST Returns (If required)

If you should have been registered earlier, you may need to file:
• retroactive FPZ-500-V GST/QST returns
• adjustments for periods already filed incorrectly
• corrected sales amounts

A CPA ensures the filings are accurate and complete.

Step 6 — Calculate Interest and Penalties

You may owe:
• interest (charged daily)
• late remittance penalties
• failure-to-register penalties

However, penalties are often dismissed or reduced if:
• you correct the error voluntarily
• no fraud or negligence is involved
• documentation is strong
• your CPA handles communication

This is why timing matters.

Step 7 — Consider the Voluntary Disclosure Program (VDP)

If you:
• missed QST registration for multiple years, or
• collected QST without remitting, or
• filed incorrectly for several periods

the Voluntary Disclosure Program may protect you.

VDP benefits:
• elimination of penalties
• reduction of interest
• protection from prosecution
• cooperative treatment instead of an audit

This option must be used before Revenu Québec contacts you.

Step 8 — Fix the System That Created the Problem

Most registration failures happen because:
• sales weren’t tracked properly
• tax codes weren’t configured
• accounting software wasn’t set up
• owners misunderstood taxable vs. exempt activities

Mackisen ensures:
• your accounting system is fully tax-compliant
• invoices automatically apply QST
• thresholds are monitored
• future filings are error-free

What Happens If You Do Nothing

If you ignore the issue:
• Revenu Québec may forcibly register you retroactively
• assess QST you should have collected
• add interest and penalties
• freeze refunds
• escalate to full audit
• send the file to collections

Doing nothing is the worst option.

Real Client Success Story

A consultant exceeded the threshold 18 months earlier but never registered.
Mackisen:
• calculated retroactive QST
• filed corrected returns
• used voluntary disclosure
• eliminated penalties
• reduced interest dramatically

The business is now clean, compliant, and stress-free.

Common Questions

Can I avoid paying retroactive QST?
No the law requires remittance even if clients refuse to pay.

Can I be penalized for forgetting?
Yes unless corrected quickly.

Can I still claim ITCs/ITRs retroactively?
Sometimes depending on documentation and timing.

Will Revenu Québec audit me?
Not necessarily proactive correction reduces risk significantly.

Why Mackisen

With more than 35 years of combined CPA experience, Mackisen CPA Montreal helps businesses fix late QST registration, file corrected returns, eliminate penalties, and build systems that prevent compliance problems going forward.