Submitting HST payments
Submitting HST payments
Business owners in Ontario have several ways to pay HST that their outstanding HST remittance to the CRA. Remember, the HST that is collected by your business should be placed into its own bank account, and not used for the business; this money is simply being collected on behalf of the CRA. This article will explore the several options to paying HST, while touching on what happens if a business owner can’t make payments.
Using the CRA “My Payment Service” is a quick and convenient method for business owners to pay their outstanding HST remittance to the CRA. The “My Payment Service” uses Interact Online through the financial institutions listed below.
- BMO (Personal Accounts Only)
- TD Canada Trust
- Envision Financial
- Libro Credit Union
- Windsor Family Credit Union
This service is quick, easy, and secure for business owners to remit HST payments below $50,000. Always be sure to be connected to the REAL CRA website, while your browser displays the HTTPS protocol and a little locked lock symbol, before submitting any payments. If you are unsure if your connection is safe, or you are not comfortable in submitting a payment through this service, there are other options available. If your payment is above the $50,000 threshold, you can remit your payment at your local financial institution either in person or online.
Business owners can also pay HST through their financial institutions online banking or telephone banking services. This method is a fast and safe method for payments for those who are already using their financial institutions online services. Again, like any payments processed online, be sure to be connected to legitimate financial institutions websites, check for HTTPS protocol being displayed in the address bar along with a locked lock symbol. Depending on the online services offered by the financial institution, the method of setting up payments and making payments may differ between institutions. For this reason, if you are unsure on how to process payments online, the next step might be easier.
Payments can be made directly at a Canadian financial institution or by mail to the CRA. To pay at your financial institution, simply visit your local branch and process the payment with an available teller. To pay the HST remittance by mail, mail the return and HST remittance to the address shown on the HST return form. Ensure that your business number is printed on the payment (include the 15 character account number) and it is payable to the Receiver General. As always, never send cash in the mail, instead use a cheque. Remember, the date that the Receiver General considers the postmark is the date of receiving the mail.
Business owners can also setup a pre-authorized debit agreement with the CRA for HST remittance, which can be very convenient for businesses that require special remitting periods, such as quarterly or monthly remittance. Pre-authorized debit (PAD) can be setup through the CRA’s “My Account”, which will connect to a sign-in partner, which is your financial institution. You will then be able to set PAD’s for HST remittance, freeing up your time and making payments very convenient, especially if HST is automatically deposited into your HST accounts.
In the case that a business owner cannot pay the HST remittance to the CRA, there are several penalties that the owner can face:
Failure To File – This penalty is applied to any HST return that is filed late, unless there is $0 amount owing or that a refund is owed by the CRA. The financial penalty is 1% plus 25% times the number of months the return is overdue, up to a maximum of 12.
Demand To File – This penalty is a $250 charge if you do not file the HST return after a demand has been made to file the return.
Failure To File Electronically – A penalty will only be applied for this if it is required that the HST return is only filed electronically. The financial penalty is $100 for the first return not filed electronically, and then $250 for each following return not filed electronically.
Failure To Accurately Report Information – In the case that information was not included, or the report is under or over reported, or reported incorrectly, the financial penalty is 5% of the amount owing, plus 1% per month of the difference between the reported amounts and the correct amounts, for a maximum of 10 months.
Interest – Interest is charged at the basic rate plus %4 to overdue amounts, insufficient payments, and any other overdue HST amounts that need to be remitted. The basic rate is changed every 90 days to ensure that it is adjusted to the current rates, rounded to the nearest whole percentage.
THIS ARTICLE deals with a number of complex issues in a concise manner; it is recommended that accounting, legal or other
appropriate professional advice should be sought before acting upon any of the information contained therein.
Although every reasonable effort has been made to ensure the accuracy of the information contained in this letter, no individual or
organization involved in either the preparation or distribution of this letter accepts any contractual, tortious, or any other form of
liability for its contents or for any consequences arising from its use.