What Every Retailer Needs To Know About The BC HST Repeal

bc hst repealThis is the second edition in our BC HST repeal article series with Mike Boven, commodity expert from BDO Canada

Any retailer that was open when the change first happened has an idea of the nuisance that is coming with the BC HST repeal…reprogramming cash registers. There are no bones about it; the process is going to be a painful one.

All the retail businesses in British Columbia had to have their cash registers and computer systems reprogrammed effective July 1st 2010 and now they have to have them reprogrammed again effective April 1st 2013, the official date of the BC HST repeal. This is something that’s really important even though the HST rate is 12% and the combined GST plus PST rate as of April 1st is going to be 12%. These taxes must be identified separately.

The various tax agencies are very particular about how tax is collected and documented. If you collect and say that it’s HST, you can’t send 7% of that off to the Province of BC because they’re not the ones who administer HST. You better say it’s 5% GST and 7% PST.

Do Not Make This Mistakebc hst repeal

Something that will also be imperative is that you don’t accidentally send your payments to the wrong government. Everybody’s in the habit of sending everything to the feds or to the Canada Revenue Agency (CRA) but that’s going to change. You’ll have to send your two cheques to two different agencies.

One factor that will probably help people not get into that mess is the provincial sales tax returns generally have to be filed every month whereas GST returns are not typically filed monthly by most businesses. In terms of programming cash registers and computer systems, it’s going to be a bit of a chore and expensive for some.

When The Clock Strikes Midnightbc hst repeal

The one little luxury retail has in this process against other industries is the timing of the change over is pretty much black and white. A customer is either standing in front of your till with their money in their hand before April 1st or after March 31st.

Obviously you will need to hire someone to come and do the switchover for you so it happens in time for your first sales on April 1st. This is an unfortunate reality of the change over but a necessary burden for retailers and small businesses. Even though it is “technically” the same amount of tax, it is going to two separate entities and that needs to be reflected starting from your very first receipt on April 1st, 2013.

Do you have any questions about the BC HST repeal? Leave a comment below and be sure to check out the rest of the articles in this special BC HST repeal series with Mike Boven, commodity tax expert from BDO Canada.

BC HST Repeal Article Series For Business Owners

  1. BC HST Repeal: How We Got Here & Where We Are Headed
  2. What Every Retailer Needs To Know About The BC HST Repeal
  3. BC HST Repeal: Details On Registering For PST
  4. BC Businesses Should Buy Equipment Before April 1st
  5. What Every Small Business Owner Needs To Know About The BC HST Repeal
  6. What The Construction Industry Needs To Know About The BC HST Repeal

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