How to get GST claimed back as ITC when there are no customers who pay GST

[Delphision · Accepted solution]

If you are registered for GST, you must charge your customers GST or HST depending on your province.  If your sales are less than $30,000 per year or in any one reporting period, you would not register for GST.  Once registered, you must charge it and remit it.  Then you claim your itc's.

If you have a business where all of your sales are foodstuff, for instance, you would report your sales, nil GST collected and then claim any itc's for things like cleaning products or waste removal.

In the case of a medical practice for instance, you do not charge GST, nor do you claim itc credits.  You then claim the full amount of the expense including the GST.

You do not, however, report or claim GST on your income tax return.  That is an entirely separate return that must be filled out.

[Amit2]

Thank you for your detailed advise. I have a follow up question.

What happens if you are running a consulting company with International Clients (where GST does not have to be charged). Can a consulting company claim for ITC for operating expenses ?

[Delphision]

I would suggest that you get a ruling from CRA to ensure that you are covered.  Either way you either get the GST back or you get the full benefit of the expense, but it is always wise to discuss international sales with CRA. 1-800-959-5525 for GST matters.