GST/HST Credit for Individuals

By Randall Orser | Personal Income Tax

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The GST/HST credit is a tax-free quarterly payment that helps individuals and families with low or modest incomes offset all or part of the GST orHST that they pay. Many of the Provinces also participate in this credit and add to it or supplement it in other ways.You are eligible for this credit if, youare a resident of Canada for income tax purposes in the month prior to and at the beginning of the month in which the GST/HST credit is issued and at least one of the following applies:

  • You are 19 years of age or older before the month in which we make a quarterly payment;

oIf you will turn 19 before April 1, 2014, you can apply for this credit on your 2012 tax return.

  • You have (or previously had) a spouse or common-law partner; or
  • You are (or previously were) a parent and live (or previously lived) with your child.

To receive the GST/HST credit, you have to apply for it, even if you received it last year. To apply, you have to file an income tax and benefit return for 2012, even if you have not received income in the year. On page 1 of your return, check the “Yes” box in the GST/HST credit application area and enter your marital status in the Identification area. If you are using a tax preparer, they will automatically tick this box (at least they should).

If you have a spouse or common-law partner, be sure to complete the information concerning your spouse or common-law partner in the Identification area on page 1 of your return. Include his or her net income, even if it is zero. Only one of you can apply for the credit. No matter which one of you applies, the credit will be the same.

What if I didn’t apply for the GST/HST credit when I filed my 2012 income tax return? Is it too late to apply now?

No. You can simply complete and send Form T1-ADJ, T1 Adjustment Request, or write a letter, to your tax centre stating you would like to apply for the GST/HST credit. Please include your social insurance number and, if applicable, your spouse’s or common-law partner’s social insurance number and net income, even if it is zero. You can also call the Individual income tax enquiries line to ask for an adjustment to your income tax return. You will receive a Notice of Reassessment in about eight weeks. Soon after, you will receive separately a GST/HST credit notice of determination and payment (if applicable).

How do I get the credit after a separation?

You should advise Canada Revenue Agency (CRA) in writing of your separation. Either use Form RC65, Marital Status Change, or send a letter to your tax centre giving CRA your new status and the date of the change. Also tell CRA that you are now applying for the GST/HST credit. After they receive this information, and, if you qualify you can start getting the credit for yourself.

Note: You are separated if you have been living apart from your spouse or common-law partner for 90 consecutive days or more because of a breakdown in your relationship, and you have not reconciled. Do not advise CRA of your separation until you have been separated for more than 90 consecutive days.

CRA calculates your GST credit for the benefit period of July 2014 to June 2015 based on:

  • The number of children for whom you have registered for the Canada child tax benefit or the GST/HST credit; and
  • Your family net income for 2013.

If you are single, your family net income is the amount from line 236 of your income tax return, or the amount that it would be if you filed a return. If you have a spouse or common-law partner, their net income is added with your net income to get your family net income.

Please note the Universal Child Care Benefit (reported on line 117 of your tax return) and registered disability savings plan (reported on line 125 of your tax return) are not included as part of your family net income for the calculation of your GST credit. However, if you are required to repay any part of the Universal Child Care Benefit (reported on line 213 of your tax return) and registered disability savings plan (reported on line 232 of your tax return), CRA will include these amounts as part of your family net income.

What happens if a GST/HST credit recipient dies?

An individual is not entitled to the GST/HST credit after he or she dies. However, CRA may send out a payment after the date of death because they are not aware of the situation. If this happens, please return the payment to the tax centre that serves your area, and give CRA the date of death so they can update their records. CRA will go after the estate for any funds paid out that should not have been, and they can be relentless.

If you owe CRA money for other taxes, they will take your GST/HST credit and apply it to any balance owing. As well, they will take your GST/HST credit for any balances owing from other organizations with which they have a shared agreement. That means they share information with that agency as well as collect payments for it.

Whenever you file your taxes, ensure that you check the box for the GST/HST credit, even if you think you may not qualify. It’s another way for the government to help out those who are lower income or have children under 18.

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