Correcting GST/HST Accounts After Several Years

When a business is registered for GST/HST, the owner is required to file GST returns according to their assigned reporting period. For some businesses this may be annually, while others file quarterly or monthly.

When those returns fall behind, the CRA may begin estimating the tax they believe should have been reported. These estimates are known as notional assessments.

The challenge with notional assessments is that they often do not reflect the real financial activity of the business. The CRA may estimate revenue, but they typically do not know what input tax credits the business should be claiming.

To correct the situation, the missing GST/HST returns need to be prepared using the business’s actual financial records. This usually involves reviewing bank statements, invoices, and expense documentation to determine the correct amounts.

Once the proper returns are filed, the CRA replaces the estimated balances with the actual calculations.

For many business owners, bringing their GST/HST account up to date removes a significant amount of uncertainty and allows them to move forward with confidence.