Tax matters made a little clearer by BCYCNA

Information contributed by the BC Yukon Community Newspapers Association, along with local PST opinion from Castlegar businesspeople.

  • Feb. 28, 2013 4:00 p.m.

BCYCNA

With the introduction of Bill 2 on February 27, the provincial government took one step closer towards removing HST and re-implementing PST and GST. With the transition scheduled to be completed on April 1 of this year, the BC ministry has stated that more than 100,000 businesses will need to register to make the transition from HST to PST. To help ease the transition, the government has provided online instructions at bgov.bc.ca/etaxbc/register.

The PST and GST tax rates will be five per cent and seven per cent, respectively. From their website: “The new PST is being implemented under a more modern and streamlined Provincial Sales Tax Act that is, for technical taxation legislation, clearer, easier to understand and comply with, easier to administer, and which better reflects modern technology and business practices.”

While the Finance Ministry confirmed that final details are still being developed, Canada Revenue Agency has provided a question and answer catalogue, which you can download at: http://www.cra-arc.gc.ca/E/pub/gi/notice270/notice270-e.pdf.

The following are a few of the questions answered in the catalogue:

Q: I invoice a customer before April 1, 2013. The customer pays the invoice  on or after April 1, 2013. What rate of tax do I charge on this sale?

A: Since the GST/HST became payable on the date of the invoice and this is before April 1, 2013, you would charge the customer the 12 per cent HST.

 

Q: What rate of tax would apply to a magazine subscription renewal if it is accepted and paid by the customer before April 1, 2013 but the magazines would be provided to the customer on or after April 1, 2013?

A: If the magazine subscription renewal payment is made before April 1, 2013, or becomes due before April 1, 2013, the amount would be subject to 12 per cent HST, even though the magazines would be provided on or after April 1, 2013.

 

Q: How do I calculate the new rate of tax on a tax-included invoice?

A: The invoice or receipt should show the rate of GST/HST that has been charged. The amount of the GST on a tax-included amount of consideration is 5/105 of the amount. To calculate the amount of consideration payable on the invoice excluding the GST, multiply the tax-included amount by 100/105.

 

Dale Donaldson of Mallard’s Source for Sports in Castlegar and Nelson feels the situation has been a mess ever since the government said they would not bring in the HST, then flip-flopped following an election win.

The businessman expressed frustration over the vagueness surrounding the regulations which are set to be instituted April 1.

“I went to a session put on by the Chamber the other week,” he related on March 1,”and there are still questions that haven’t been answered.”

He referred to a positive feeling in regard to the HST in spite of the questionable way it had been brought in.

“It was more straightforward than the PST system it replaced, and the one that’s coming back,” said Donaldson who is resigned to what he expects will be increased expense and administrative headaches coming with the return to the PST/GST arrangement.

“For the customer there’s really no difference,” he said, “it’s what goes on behind the scenes that’s complicated.”

Another viewpoint was obtained from Colleen Kalnins of Common Grounds coffee house.

“I’ve got a bookkeeper who’s doing all the other stuff, so my transition will be just to get my till re-programmed,” said Kalnins who is optimistic about what lies ahead.

“I think it’s going to help small business… I’m hoping,” she said. “Because when the extra tax went on it bumped my costs but I couldn’t raise my prices to compensate. So I’m hoping it’s going to help. I don’t know, it’s going to be hit and miss, we’ll have to wait and see what happens.”

 

 

Just Posted

South Slocan woman killed in Friday crash

Police continue to investigate cause of fatal crash

Castlegar’s Stanley Humphries School’s got talent

Talent show to be held Feb. 21 at Brilliant Cultural Centre

What’s Up: Things to see and do on Family Day

There’s plenty of fun to be had across the West Kootenay this coming long weekend!

Province announces $23 million for upgrades at Kootenay Boundary Regional Hospital

West Kootenay-Boundary Regional Hospital District Board has yet to review the provincial proposal

Selkirk College Saints score pair of crucial wins

Stellar goaltending and timely goals lead to victory over the Vancouver Island University Mariners.

Trudeau’s principal secretary, Gerald Butts, resigns amid SNC-Lavalin furor

Butts categorically denies the accusation that he or anyone else in the PMO improperly pressured former attorney general Jody Wilson-Raybould

Ammonia leak shuts down curling club in Nelson

It’s not yet clear when the leak was detected

Lost a ring? This B.C. man will find it for you

Chris Turner founded The Ring Finders, an international directory of metal detector hobbyists

Poverty coalition has high hopes for B.C. poverty reduction strategy

Funding allocation expected to be released with 2019 budget

East Kootenay mine deaths prompt safety initiatives

Teck produces educational video, introduces new procedures after contractor drowns at Fording River

‘How did we get here?’: B.C. mom of transplant recipient worries about measles outbreaks

Addison, 7, cannot get a live vaccine because she has a heart transplant

NDP Leader Jagmeet Singh calls for public inquiry over SNC-Lavalin questions

Vancouver member of Parliament Jody Wilson-Raybould resigned from cabinet last week

Canadian airlines waiting for guidance from Ottawa over X gender option

Major U.S. airlines said they will change their process so passengers can identify themselves along non-binary lines

Moose Hide campaign takes message to Canadian schools

Campaign launches new K-12 education platform

Most Read