The GST/HST Quick Method, Explained

The Quick Method is the CRA's shortcut: instead of tracking the tax on every expense, you remit a flat percentage of what you billed (tax included) — and keep the difference. Here is who can use it, the exact rates, and when it backfires.

How it works

You charge your clients the full GST/HST rate exactly as usual. The difference is at filing time. Under the regular method you remit (tax collected − input tax credits on expenses). Under the Quick Method you remit a set percentage of your tax-included sales, set by the CRA tables below. You do not claim input tax credits on ordinary expenses (you can still claim them on large capital purchases like equipment and vehicles). The CRA also gives you a 1% credit on the first $30,000 of eligible sales in each fiscal year.

A quick example: an Ontario consultant bills $80,000 plus 13% HST — $90,400 tax included, $10,400 collected. At the 8.8% services rate she remits $7,955.20, minus the $300 credit (1% of the first $30,000), for $7,655.20 — keeping about $2,745 of the tax she collected, with no receipt-by-receipt ITC tracking. The calculator on the home page runs this comparison with your own numbers.

Who is eligible

Most small businesses and self-employed people can elect the Quick Method if:

• Your annual worldwide taxable sales (including GST/HST, and including associates' sales) are $400,000 or less;
• You have been in business and a GST/HST registrant for at least a year (with limited exceptions for new businesses in their first year of filing);
• You are not in an excluded category (below).

You elect it by filing form GST74 with the CRA, and the election generally takes effect from the start of a reporting period.

Remittance rates — businesses that provide services

Find your row (where your client's supply is taxed) and your column (where your business is located). Rates are a percentage of tax-included sales.

Remittance rates — businesses that buy goods for resale

These lower rates apply if the cost of goods you buy for resale is at least 40% of your taxable sales.

* When a goods business located in an HST province sells into a GST province at the 0% rate, it also receives a credit of 2.8% (Ontario), 3.4% (Nova Scotia) or 4.0% (NB, NL, PEI) on those sales.

When the Quick Method wins — and when it backfires

It usually wins for service businesses with low overhead: consultants, designers, writers, trades with few materials. Your expenses carry little tax, so giving up ITCs costs you almost nothing, and the gap between what you collect and what you remit is yours to keep.

It backfires when you spend heavily on things that carry GST/HST — a big equipment purchase, expensive subcontractors, commercial rent. Then the ITCs you give up can be worth more than the Quick Method discount. Rule of thumb: if your taxed expenses are under roughly 20% of sales, the Quick Method usually wins — but run your real numbers in the calculator before you elect.

Quebec note: QST has its own Quick Method rates administered by Revenu Québec. The GST side still uses the CRA rules above.