What is GST HST Notice?

A GST or HST notice is a formal message from the Canada Revenue Agency that alerts you to an issue in your Goods and Services Tax or Harmonized Sales Tax account. It tells you that something in your GST or HST return, payment, registration number, or tax filing requirements needs attention. These notices often affect things like GST or HST paid, Input Tax Credits, your refund or credit, a GST or HST rebate claim, or eligibility for a GST or HST credit or break. 

You usually see these notices inside your CRA Account or receive them by mail after the CRA reviews information from your bookkeeping system, your income tax return, or your business registration online filing. 

Below is a clear breakdown of what these notices mean and how to respond. 

Why You Receive a GST or HST Notice 

You receive a notice for one of these reasons: 

1. Missing returns: Your GST or HST return has not been filed. 

1. Payment issues: The CRA found mismatches in your GST or HST paid amounts. 

1. Adjustments: The CRA recalculated your tax filing, affecting your refund or credit, Input Tax Credits, or GST or HST rebate claim. 

1. Verification requests: The CRA needs documents to support ITCs, rebates, or GST or HST collected. 

1. Compliance concerns: Issues with your registration number, your reporting frequency, or your business registration online details. 

Examples of Common Mistakes Triggering Notices 

These errors frequently cause CRA notices: 

1. Incorrect Input Tax Credit claims: Missing invoices, personal expenses claimed as business expenses, or math errors. 

1. Filing errors: Submitting the wrong period or leaving out sales subject to GST or HST. 

1. Payment mismatches: Paying the wrong amount after filing your GST or HST return. 

1. Incorrect rebate submissions: Errors in GST or HST rebate applications. 

1. Not updating CRA Account information: Outdated contact details or registration number. 

1. Incorrect NETFILE or TELEFILE submission: Errors made while filing through the CRA website. 

The Most Common Types of GST or HST Notices 

Business owners usually see these notices: 

1. Filing reminder: A reminder to file your GST or HST return. 

1. Demand to file: Sent when a return is overdue. 

1. Statement of account: Shows your balance, credits, instalments, and GST or HST paid. 

1. Notice of assessment: The CRA’s calculation of your return, rebates, Input Tax Credits, and tax credits. 

1. Notice of reassessment: The CRA changed your reported figures after a review. 

1. Instalment reminder: Alerts you that instalments are required. 

1. Penalty and interest notice: Sent when filings or payments are late. 

1. GST or HST rulings notice: The CRA responds to a technical question you submitted. 

1. Compliance verification notice: Requests documentation to validate your GST or HST return. 

Understanding the Impact of Specific Notices 

Each notice can lead to a consequence: 

1. Penalties: Late filing penalties and instalment penalties. 

1. Interest: Charged daily on unpaid amounts in your CRA Account. 

1. Refund holdbacks: The CRA may delay your refund or credit until verification is complete. 

1. Reduced GST or HST break eligibility: Errors can affect access to credits or rebates. 

1. Additional reviews: Repeat issues may lead to ongoing CRA monitoring. 

What To Do When You Receive a Notice 

Use this sequence to respond: 

1. Read the notice: Identify the tax period, the issue, and the filing requirements. 

1. Check your books: Review GST or HST paid, Input Tax Credits, and rebate claims. 

1. Take action: 

1. File missing returns using GST or HST NETFILE on the CRA website. 

1. Pay outstanding balances. 

1. Submit documents through your CRA Account. 

1. Correct errors: Update your GST or HST return or rebate claim if needed. 

How To Respond to Different Notice Types Efficiently 

Different notices require different actions: 

1. Statement of account: Compare the balance with your records, then pay or correct mismatches. 

1. Assessment or reassessment: Review CRA adjustments affecting ITCs, rebates, or tax filing results. 

1. Compliance verification: Provide invoices, receipts, sales reports, and bank statements quickly. 

1. Demand to file: File the missing GST or HST return immediately. 

1. Instalment reminder: Adjust your instalment schedule to stay compliant. 

Voluntary Disclosures Program 

If you discover past errors, the Voluntary Disclosures Program lets you correct them before the CRA escalates penalties. 

You can disclose: 

1. Missed GST or HST returns. 

1. Incorrect Input Tax Credit claims. 

1. Unreported GST or HST collected. 

1. Filing errors that affected your refund or credit. 

1. Errors that spilled into your income tax return. 

When accepted, the program reduces or removes penalties and may lower interest. 

Steps To Request a Review or File an Objection 

If you disagree with a notice: 

1. Request a review: Contact the CRA or submit documents through your CRA Account. 

1. File a Notice of Objection: Must be filed within 90 days of the reassessment. 

1. Gather evidence: Invoices, contracts, sales data, bank statements, rebate documentation. 

1. Wait for the CRA decision: An appeals officer reviews your case. 

1. Escalate if needed: You may appeal to the Tax Court of Canada. 

How To Avoid Notices in the Future 

Improve compliance with these habits: 

1. File GST or HST returns on time. 

1. Track Input Tax Credits properly. 

1. Reconcile GST or HST collected and GST or HST paid every month. 

1. Keep CRA Account details current. 

1. Review eligibility rules for rebates, tax credits, and GST or HST breaks. 

1. Keep tidy bookkeeping: Fewer mistakes lead to fewer notices. 

Need Help With a GST or HST Notice? 

If you received a GST or HST notice and want clarity, Mesa CPA can review your GST or HST return, verify your Input Tax Credits, prepare or adjust your rebate claims, and handle the CRA directly through your CRA Account. 

Book a consultation with Mesa CPA and resolve your GST or HST issue correctly, quickly, and with confidence.