GST/HST is the filing small businesses get wrong most often, and almost never on purpose. The rules are mechanical; the difficulty is that they depend entirely on the underlying bookkeeping being right.
Which deadline applies to you
Your filing frequency follows your taxable supplies, and the deadline follows the frequency. Annual filers with a December year end face one date; quarterly and monthly filers face a rolling one month after each period. A business that grows across a threshold can change frequency without noticing, which is how a first missed deadline usually happens.
The four errors
- Claiming input tax credits on exempt or zero-rated purchases. Not everything you buy carries recoverable tax, and a blanket claim across all expenses is the fastest way to attract a review.
- Claiming the full amount on meals and entertainment. The general rule limits the claim, and the books need to reflect that at the point of coding rather than at filing.
- Missing credits on capital purchases. The opposite error, and it costs real money: equipment and vehicle purchases frequently carry a recoverable amount nobody claimed.
- Filing on a number that does not tie to the books. If the return and the general ledger disagree, the return is indefensible even if the number happens to be right.
Keeping it boring
Filing should be a formality: the books close monthly, the tax accounts reconcile as part of that close, and the return is a report rather than a project. Every part of that is a bookkeeping discipline rather than a tax one, which is why the businesses with the fewest GST/HST problems are not the ones with the best tax advice.