S. Robertson asked:

How do you calculate the HST on gas in Ontario?

Julia Germain answered:

Assuming your bills have no other tax (i.e. provincial sales tax), the formula for calculating the HST/GST on gasoline using an example of $100 cash outlay receipt:

$100.00 divide by Ontario Rate of 1.13 = $88.50 (net cost of gas).

$88.50 multiply by factor .13 = $11.50 which is the allowable ITC that can be claimed.

Rates as of Oct 31 2014:

• AB, BC, NWT, Sask, NV, Yukon, and MB 5% GST – Rate 1.05, Factor .05
• ON, NB, NL/LAB,  13% HST – Rate 1.13, Factor. 13
• NS – 15% HST – Rate 1.15, Factor .15
• PEI – 14% HST – Rate 1.14, Factor .14

For provinces that have Provincial Sales Tax, the calculation can be different.  Contact BC, MB, SK and QC directly to inquire.

The CRA website has some excellent information on it for the HST.

http://www.cra-arc.gc.ca/tx/bsnss/tpcs/gst-tps/menu-eng.html

You can also call them @ 1-800-959-5525 where any of their phone attendants can help you with all HST/GST questions.

Beware of receipts that show GST amounts and/or state GST included that do not state the GST #.  You have the right to ask for the # prior to paying the HST.  You can check the validity of all HST #’s @ http://www.cra-arc.gc.ca/gsthstregistry/

You are required to verify this information otherwise claiming HST as an input tax credit if not valid can be considered fraudulent if you are audited for HST. 

You are acting as a trustee for CRA to collect their tax.  You are responsible to do it correctly.

Click here to go back to Ask-an-Expert index page.