The short version
In Alberta you charge 5% GST. Alberta has no provincial sales tax and is not an HST province.
You have to register for GST once your taxable sales pass $30,000. Until then you are a "small supplier": you do not have to register, you do not charge GST, and you cannot claim back the GST you pay on materials, tools and fuel.
When you have to register
The CRA's test has two parts, and you have to watch both.
$30,000 in a single calendar quarter. You stop being a small supplier straight away. You charge GST on the very sale that took you over, and you have to register within 29 days.
$30,000 over four consecutive quarters, without going over in any one of them. You stop being a small supplier at the end of the month after the quarter in which you crossed it, and you start charging GST from your first sale after that.
Calendar quarters are January to March, April to June, July to September and October to December. A commercial sub billing $8,000 a month crosses the four-quarter line in its fourth month, and one large progress invoice can cross the single-quarter line on its own.
Why register before you have to
- You get the GST back on your costs. Only registrants can claim input tax credits. If you are not registered, the GST on your lumber, fasteners, rentals and fuel is simply a cost.
- GCs expect it. A registered GC claims back the GST it pays you. To do that it needs your GST registration number on the invoice.
- The T5018 asks for it. A GC filing a T5018 on you enters your business number, or your SIN if you have none.
The trade-off is the paperwork: once registered, you charge GST on every taxable sale and file GST returns.
What your number looks like
When you register you get a 15-character number: your 9-digit business number, then RT for the GST/HST program, then a 4-digit account number. For example 123456789RT0001. That is the number that goes on your invoices.
A GC can confirm a sub's number with the CRA's online GST/HST registry before paying them.
What goes on your invoice
To let a GC claim the GST it paid you, the CRA requires certain information on the invoice, and the list grows with the size of the sale. For a commercial job, put all of it on every invoice and you will never be short:
- your business name,
- the invoice date,
- your GST registration number,
- the GC's name,
- a description of the work,
- the amount, and the GST shown separately or the total marked as including GST,
- your payment terms.
On a commercial job in Alberta that invoice should also meet the Act's definition of a proper invoice, or the payment clock does not start. That list is in the prompt payment guide.
Where to register
Online through the CRA's Business Registration Online, by phone, or by mail. The rules above are from the CRA's pages on when to register and start charging GST/HST and its general guide for registrants.
Working commercial jobs around Calgary? Join Syndex as a subcontractor. It is free.