You should!
Sales tax laws are often stricter than income tax laws. For example, for the same expense, for tax purposes, it may be sufficient to justify that the expense was incurred for business purposes for it to be deductible. However, for consumption tax purposes, there is a whole series of criteria that must be met before GST/HST and/or QST paid on an expense can be claimed.
Here are some examples (this is not an exhaustive list):
- Do you have supporting documentation? A credit card receipt would not be sufficient supporting documentation to claim taxes paid on purchases, depending on the tax claiming method you have chosen;
- Is the name of the supplier or its authorized representative indicated on the voucher?
- Is the supplier registered for GST/QST and/or QST? To find out, you need to make sure that the supplier’s registration numbers are valid at the time you claim the taxes, for example, through the tax authorities’ portals:
So you get the idea! Validating supplier registration numbers is very important, but often overlooked.
This is all the more important because, with the new rules for non-resident suppliers in Quebec or Canada (think “Netflix tax”), many non-residents have registered for “simplified” GST and QST regimes. In the QST system, their registration number begins with NR. Taxes must be collected from consumer purchasers and persons not registered for regular GST and QST. If you don’t, you’ll have paid GST and QST in error, and you won’t be able to claim the taxes as input tax credits (ITCs) or input tax refunds (ITRs).
Agence du Revenu du Québec press release
Due to the increasing number of people who have paid and claimed these “simplified” taxes in error, the Agence du Revenu du Québec has issued the following communiqué: Please provide your QST registration number before making any transactions.
If you believe you have claimed tax without entitlement on purchases made from non-residents of Quebec/Canada, we invite you to contact us to find out about options for rectifying the situation.
CONTACTS
Sylvie Therrien
Associate – Commodity taxes
Telephone: 450 971-1550, ext. 3321
Jerry Médénou, CPA
Director – Consumption taxes
Telephone: 450 971-1550, ext. 3606
