Input Tax Credits

Question 1

HST registrants get a credit for the HST they pay on purchases/expenses related to commercial activities by claiming what?

Answer 1

INPUT TAX CREDITS

Question 2

How much is an input tax credit on purchases and expenses for business?

Answer 2

EQUAL TO AMOUNT OF HST

Question 3

ITCs __________ the amount you have to remit to Revenue Canada for your sales.

Answer 3

REDUCE

Question 4

What are the 2 methods for accounting for HST collection and remittance?

Answer 4

standard INPUT TAX CREDIT METHOD (long hand)
\+
QUICK METHOD (regular)

Question 5

If you are NOT an HST registrant and you buy towels for your clinic for $10 plus HST at $1.30, then the total cost of $____.____ is a Business Expense for what?

Answer 5

11.30
+
Used to reduce gross income for calculating income tax

Question 6

If you ARE an HST registrant and you buy towels for your clinic for $10 plus HST at $1.30, then the total cost of $___.___ is a Business Expense and what happens with the rest?

Answer 6

10.00
+
1.30 reduction in the amount of collected HST before you remit HST collected for the period.

Question 7

The _________ method tends to work in favour of RMTs.

Answer 7

QUICK

Question 8

ITCs give _______ benefit, whereas business expenses give a _________ benefit.

Answer 8

100%
+
PARTIAL