The Quick Method is an optional way for an eligible GST/HST registrant to calculate net tax. It does not change the GST or HST rate charged to customers. You still charge GST at 5% or HST at the applicable rate; the Quick Method uses a separate CRA remittance rate to calculate what is remitted. The rate is not a universal 3.6%. CRA Guide RC4058
Check eligibility before comparing results
Among CRA’s conditions, the business needs a permanent establishment in Canada and generally must have annual worldwide taxable supplies (including GST/HST and associates’ amounts) of no more than $400,000 under CRA’s specified four-quarter test. New registrants may qualify if they reasonably expect the same limit in their first full year. CRA excludes financial services and sales of real property, capital assets, and goodwill from that calculation. CRA eligibility conditions
CRA excludes several business types, including tax, bookkeeping, financial-consulting, legal, accounting, and actuarial practices; charities and listed financial institutions also cannot use this method. Check the full exception list, especially after a change in services or ownership.
Understand the trade-off
The Quick Method reduces the need to report actual GST/HST on most operating purchases, because the remittance rate is meant to account for approximate ordinary ITCs. As a result, you generally cannot claim ITCs for most operating expenses and inventory purchases. CRA lists limited categories that can still qualify, including capital assets, real property and improvements, and eligible tax from before the election. CRA: ITCs under the Quick Method
Illustration: Two service businesses can charge the same 5% GST but have different Quick Method results because their eligible supplies, remittance-rate category, province, and purchases differ. Compare the regular method and the Quick Method with actual records; neither is automatically cheaper.
Election, duration, and records
Elect through My Business Account, Represent a Client where authorized, or Form GST74. The effective date must be the first day of a GST/HST reporting period, and election deadlines differ for annual and monthly/quarterly filers. CRA generally requires a one-year wait after revocation before a new election. Keep purchase and supply records even when using the Quick Method. CRA: election and revocation rules
For return mechanics, see GST/HST filing guidance.
How to fill a GST/HST return using the Quick Method
For a reporting period covered by an effective Quick Method election, use the CRA’s return instructions in Guide RC4058. The following are the NETFILE lines; TELEFILE combines some of the amounts as described below.
- Line 101: Total the eligible taxable supplies for the period including the GST/HST charged or collectible, and round to the nearest dollar. Under the guide’s Quick Method instructions, exclude sales that are ineligible for the calculation, supplies on which no GST/HST was charged, and separately charged PST.
- Line 103: Multiply eligible tax-included sales by the applicable CRA remittance rate. If more than one rate applies, calculate each group separately. Add the full GST/HST collected or collectible on taxable supplies that are not eligible for the Quick Method calculation. Enter the total on line 103; in TELEFILE, include it in the line 105 calculation.
- Lines 106 and 107: Enter only ITCs still allowed under the Quick Method on line 106; most operating expenses do not qualify separately. Certain 0% remittance-rate sales have an additional credit that CRA includes on line 106. If entitled to the separate 1% credit, enter it on line 107. For TELEFILE, include these amounts in the line 108 calculation.
- Complete and file the return: Include any applicable adjustments, instalments and other amounts, review the calculated balance, then file and pay any amount owing by the applicable deadlines. Follow the CRA instructions for your filing method and circumstances. When filing electronically under the Quick Method, CRA says not to choose the option to complete lines 90, 91 and 102.
The 1% credit applies to the first $30,000 of qualifying tax-included revenue in each fiscal year. To qualify, the election must have been in effect at the start of that fiscal year or, for a new registrant, on the day registration began. Monthly or quarterly filers track the limit across the year; unused credit cannot be carried forward.
Example: Assume an Ontario goods reseller with an Ontario permanent establishment qualifies for the CRA goods-resale rate category, has $10,000 of eligible Ontario sales plus $1,300 HST, and uses the applicable 4.4% remittance rate, and qualifies for the 1% credit on all $11,300 in its first reporting period of the fiscal year. With no other adjustments or claims, line 101 is $11,300, line 103 is $497.20, and line 107 is $113.00; the resulting net tax is $384.20. These assumptions matter: use CRA’s rate table and your own eligibility, supplies and credit history rather than treating 4.4% as a standard rate.