Topic 6 - HST

Question 1

A federal tax that applies on most goods made and services supplied in Canada.

Answer 1

Goods and Services Tax (GST)

Question 2

The GST was introduced in 1991 by Brian Mulroney at a rate of __%, and it’s been a political football ever since Jean Chretien campaigned on a promise to scrap the tax, and then didn’t follow through.

Answer 2

7%

Question 3

_______ ______ campaigned on a promise of two GST rate reductions over a five year period and reduced the rate to 6% in 2006, and to 5% on January 1st, 2008.

Answer 3

Stephen Harper

Question 4

T/F - It is likely that there will be further reductions to GST in the near future.

Answer 4

False - It is NOT likely that there will be further reductions to GST in the near future.

Question 5

_____________ of the federal Goods & Services Tax (GST) with Ontario’s 8% Retail Sales Tax took effect July 1st, 2010.

Answer 5

Harmonization

Question 6

On July 1st, 2010, the Ontario PST ceased to exist when it was combined with the GST to become the ___% Harmonized Sales Tax (HST).

Answer 6

13%

Question 7

Where it still exists in some other parts of Canada, the GST rate remains at __%.

Answer 7

5%

Question 8

A tax that is only applicable in an individual province. It only applies to the sales of goods, and not the supply of services.

Answer 8

Provincial Sales Tax (PST)

Question 9

Most provinces have a PST, with _______ being a key expection.

Answer 9

Alberta

Question 10

Virtually all consumers pay GST and HST on taxable goods and services, except some provincial governments and _____ _______ people.

Answer 10

First Nations

Question 11

T/F - For certain goods or services, some First Nations people are charged GST at 5% rather than HST at 13%.

Answer 11

True

Question 12

For First Nations patients, does HST apply if massage happens on a reserve?

Answer 12

No tax charged

Question 13

For First Nations patients, does HST apply if massage happens off-reserve?

Answer 13

HST applies (13%)

Question 14

T/F - Diplomats, the federal government and municipalities do not pay GST/HST.

Answer 14

False - Diplomats, the federal government and municipalities DO pay GST/HST.

Question 15

T/F - In almost all cases, RMTs who are registered to charge HST will always charge it to their patients.

Answer 15

True

Question 16

Consumers ___ HST when they buy a product or service. That could be when an RMT buys supplies for their clinic, and ____ HST on the purchase.

Answer 16

Pay
Pays

Question 17

Some RMTs ______ HST on the cost of their massage treatments, which is not our money or income because it belongs to the __________.

Answer 17

Charge
Government

Question 18

Who do RMTs collect HST on behalf of and periodically remit it to?

Answer 18

Canada Revenue Agency (CRA)

Question 19

T/F - Most medical services do not have HST added to them, but massage therapy does.

Answer 19

True

Question 20

Since HST is a _______ tax, it is only exempted when the good or service is regulated _________, or in all/majority of provinces. This means massage therapy is not exempt of HST because it is regulated province by province.

Answer 20

Federal
Federally

Question 21

What are the 6 provinces that have now regulated massage therapy?

Answer 21

Ontario
British Columbia
Newfoundland & Labrador
New Brunswick
Prince Edward Island
Saskatchewan

Question 22

Which province passed its legislation for massage therapy a year ago and is in the process of forming its regulatory body?

Answer 22

Saskatchewan

Question 23

The CRA has made it abundantly clear that massage therapy will need to be regulated in a ________ of provinces before GST/HST will be removed from it.

Answer 23

Majority

Question 24

There is possibility of regulation of massage therapy beginning in the next few years in ________ and _______.

Answer 24

Manitoba
Alberta

Question 25

In February 2014, the federal government announced that ___________ and ___________ are now exempt from HST. This has provided us with a template to follow for asking for massage therapy to be exempt from HST.

Answer 25

Naturopathy
Acupuncture

Question 26

You have to charge the HST if you provide _______ goods and services in Canada and you are not a “_____ ________.”

Answer 26

Taxable
Small Supplier

Question 27

An RMT needs to start charging HST when their gross income from massage exceeds $________ per year (before expenses).

Answer 27

$30,000

Question 28

An RMT needs to review their HST-able income over the last ___ months at any time of the year, not just the ________ year.

Answer 28

12 months
Calendar

Question 29

Income that comes from selling the goods and services that have HST applied to them.

Answer 29

HST-able Income

Question 30

T/F - Massage therapy is not considered HST-able income.

Answer 30

False - Massage therapy IS considered HST-able income.

Question 31

Income for a “calendar _______” involves totalling up the income for __ months.

Answer 31

Quarter
3

Question 32

T/F - When your HST-able income from the last 4 continuous quarters exceeds $30,000, you will need to register to charge HST.

Answer 32

True

Question 33

T/F - Once you register to charge HST, you must charge the tax within 24 hours.

Answer 33

False - Once you register to charge HST, you must charge the tax IMMEDIATELY.

Question 34

You can’t charge HST unless you have __________ to charge it.

Answer 34

Registered

Question 35

T/F - If you qualify as a small supplier, you can choose whether or not to charge HST.

Answer 35

True

Question 36

T/F - Partnerships and corporations do not count as a whole for the $30,000 calculation.

Answer 36

False - Partnerships and corporations DO count as a whole for the $30,000 calculation.

Question 37

Fill in the blanks for the different types of goods and services:
- Those that are ______ from HST
- Those that have HST charged at __%
- Those that have HST charged at __%
- Those that have HST charged at ___%

Answer 37

Exempt
0%
5%
13%

Question 38

Some examples of goods and services that are ______ from HST include:
- Chiropractic care/physiotherapy (most regulated health)
- Residential rent
- Music lessons
- Salaried income

Answer 38

Exempt

Question 39

Some examples of goods and services that are taxable at __% include:
- Milk, eggs & bread
- Medical devices
- Medications
- Adult diapers

Answer 39

0%

Question 40

Some examples of goods and services that are taxable at __% include:
- Books, newspapers/magazines
- Children’s clothing

Answer 40

5%

Question 41

Some examples of goods and services that are taxable at ___% include:
- Massage therapy
- Most consumer goods & services
- Commercial rent
- Prepared food/meals
- Adult clothing

Answer 41

13%

Question 42

Employment income as a ________ employee does not count toward the $30,000.

Answer 42

Salaried