Remitting GST/HST on Taxable Benefits

Did you know that GST/HST must be remitted on a taxable benefit unless the benefit is tax exempt or zero-rated, for example the benefit on low-interest loans? An example of a tax benefit that is not exempt includes the automobile standby charge and operating expense benefit. GST/HST must be remitted on shareholder benefits if they fall into Subsection 15(1) and are not tax zero-rated or tax exempt.

Automobile operating expense benefit

If your employee ordinarily worked in, or the location to which he or she ordinarily reported to, is located in a p a r t i c i p a t i n g province (British C o l u m b i a , New Brunswick, Newfoundland and Labrador, Nova Scotia, or Ontario), you are considered to have collected an amount equal to a percentage of the value of the benefit for GST/HST purposes, based on one of the following rates:

  • 5% for British Columbia;
  • 11% for Nova Scotia;
  • 9% for New Brunswick, Newfoundland and Labrador;
  • 9% for Ontario, or 6% if the registrant is a large business for the purpose of the recapture of input tax credits for the provincial part of the HST.

If your employee ordinarily worked in, or he or she ordinarily reported to, a location in a non-participating province or territory (the rest of Canada), you are considered to have collected 3% of the value of the benefit for GST/HST purposes as calculated above.

Other Than Automobile Operating Expense Benefits

If the last establishment where your employee ordinarily worked, or to which he or she ordinarily reported in the year, is located in a participating province (British Columbia, New Brunswick, Newfoundland and Labrador, Nova Scotia, or Ontario), you are considered to have collected the GST/HST as a percentage of the value of the benefit as follows:

  • 11/111 for British Columbia;
  • 14/114 for Nova Scotia;
  • 12/112 for Ontario, or 4/104 for benefits relating to a motor vehicle that is subject to the recapture of the input tax credits for the provincial part of the HST, if the registrant is a large business;
  • 12/112 for all other participating provinces.

If the last establishment where your employee ordinarily worked or to which he or she ordinarily reported in the year is located in a non-participating province or territory (the rest of Canada), you are considered to have collected 4/104 of the value of the benefit for GST/HST purposes as calculated above.

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