Not Registered to Collect GST/HST - are GST/HST Costs Tax
Deductible?
If your business is not registered to collect GST, then
you will not be able to claim any input tax credits to get
a refund of the GST or HST you pay. However, you can deduct
the GST/HST for income tax purposes, as part of the cost of the
item you have purchased.
For income tax purposes, the cost of an item will include the purchase price
+ GST or HST + provincial retail sales tax (where applicable).
When the item you have purchased
is a fixed asset such
as an automobile, then the cost including taxes is the
amount to record as the cost of that item. You will
able to claim capital cost
allowance on this amount.
If the item purchased is
an expense, then the cost including taxes will be recorded
as the expense.