HST Registration for New Business Owners – You Are Registered Personally. Canada 150 Recommendation #54

A business owner who registers for the HST and is not incorporated should understand that they have registered to collect the tax personally. There is no legal separation between you and the proprietorship you have formed, so it is you personally who are registered.

This means that there is nothing you can charge money for now that will not attract HST. Example – you register your graphic artist business to collect HST and operate that business. That business is going along well and you decide to open a printing business to take advantage of all the stuff that you design and your customers print. You will have to charge HST right from the start for the print business because you are already registered.

Maybe you have noticed that your business number has 0001 as the last numbers. When you start another business, you use the same business number but the last digits will be 0002. Luckily there are four digits there in case you want to start 9999 businesses.

Occasionally I will hear from a business owner who thinks they have found a way around the $30,000 in sales requirement to register for HST. They will have decided that the thing to do is set up a number of different businesses and keep each one under $30,000. Needless to say, CRA thought of this idea a long time ago and that is another reason why there is no separate registrations for individuals when you register for HST.

Remember when your business is not incorporated and you register to collect HST that you are now personally registered to collect HST – anything you do where you charge money for a product or service will mean that you have to charge HST.

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