How to calculate HST using Quick Method
Updated: Feb 20, 2021
The quick method is another accounting option available to help small businesses calculate their net tax for HST purposes. This method reduces paperwork and makes it easier to calculate HST remittances and file HST returns because it eliminates the need to report the actual HST paid or payable on most purchases.
When you use the quick method, you still charge the HST at the rate of 13% or the HST at the applicable rate on your taxable supplies of property and services.
When making your quick method calculations, your first $30,000 is entitled to a 1% credit on eligible supplies (including the HST) on which you collect the HST at 13%. So the rate in effect on the first $30,000 is 7.8%. Sales above $30,000 is subject to 8.8%.
The difference you save as a result of using the quick method Vs the regular method should be calculated and reported as income on your corporate tax return or the statement of business income if you are not incorporated.
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