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Why do I need to include GST/HST that I have collected if I am paying this money back in my GST/HST return? I dont see anywhere to specify how much I have collected, is it assuming internally somewhere that 13% of my income I've stated is GST that I will be paying back separately? -Professional income -Gross professional fees including work-in-progress (WIP) and GST/HST collected or collectible
Problem: (1) Gross sales are escalated erroneously in the Québec part of the tax return when uFile calculates adjusted gross income to include quick-method gains in GST/HST and QST, if certain amounts are indicated in the interview. Problem: (2) uFile does not permit me to enter quick-method amounts specific to my federal tax return and to my Québec return. Solution to problem: uFile needs to permit me to distinguish between what the feds ask when it comes to quick-method amounts and what Québec asks. My situation I have business income in Québec and clients in Québec and in Ontario. For the clients in Québec, I charge and collect GST and QST. For the clients in Ontario, I charge and collect HST. In uFile, this is what I have to do to avoid my Gross Sales escalating erroneously in uFile's calculations of Gross Sales in the Québec part of my tax return. In uFile's interview, on the T2125, Income Expenses page, under Business Income, next to "Gross sales, commission or fees", I put Gross Sales only, and nothing for GST, QST, HST, whether collected or not. Next to "Quick Method - GST/HST collected or collectible on sales, commissions and fees eligible for the Quick Method", I put the total of GST/HST collected from Ontario and Québec plus QST collected in Québec. Note: the uFile algorithm disadvantages me because I need to put QST here to get it to show up in the Québec part of the return, even though the Feds only ask here for the GST/HST. Next to "Quick Method - For each applicable remittance rate, include X, Y and Z each multiplied by the appropriate Quick Method remittance rate", I put the total of GST/HST and QST remitted. uFile correctly uses the difference to calculate the gain that is deemed to be taxable earnings. The gain plus the gross = adjusted gross sales. [As an aside, problem #3, the descriptor for this amount is unclear to taxpayers who are not mathematicians, computer programmers, logicians or accountants because they interpret the parentheses as enclosing a parenthetical statement (i.e., an afterthought), while in this case the parentheses need to be interpreted in the logical or mathematical sense and not as a comment. uFile’s help should clarify this line for the rest of us. To be clear, I'm referring to the parentheses in this descriptor: GST/HST remitted, calculated on (sales, commissions, and fees eligible for the quick method plus GST/HST collected or collectible) multiplied by the applicable quick method remittance rate.] Next to "GST/QST included in sales", I put zero. Here's the problem (#1). If I put any amount in GST/QST included in sales, I need to add it to the Gross Sales line. That's ok for the feds, because it is deducted and the adjusted gross sales comes out equal to the gross sales. But for the Québec side, that amount is added to the gross sales along with the amount remitted and the adjusted-sales amount is escalated erroneously, to my disadvantage, of course. Here's problem #2. The feds ask only for the amounts of GST/HST collected and GST/HST remitted (read the line carefully!). The feds will not tax you for the QST gain. Québec asks for amounts for GST, HST and QST for both collected and remitted, and taxes me on both the GST and QST gains. You can test what I am saying. Follow my example above with your amounts in your Interview, click Tax Return, wait, look at how the sales amounts appear in the T2125 for the feds and the TP-80 for Québec. Save those pages somehow for comparison. Go back and increase your gross sales by the GST/QST collected and put the same increment on the "GST/HST included in sales" line. Regenerate the return and look at the Québec TP-80. Compare the amounts and you'll see what I'm getting at. You can also exclude the QST where uFile asks only for GST/HST and then be left wondering how to include the QST gain for the Québec side of the fence. Regenerate the return and look at the TP-80 again. To be on the safe side, Canadian citizens fearful of the long arms of the law need to report the QST gain to the feds even though they don't ask for it. uFile's interview needs more boxes to avoid paying unnecessary taxes. uFile also needs better explanations on how to enter data for the Quick Method. I think uFiles explanations are weak because uFile does not have hands-on experience with the Quick Method in Québec and makes assumptions that result in disadvantages to the taxpayer. Thankfully, uFile allows us to generate as many returns as we like to see what happens based on how our amounts are entered. With tedious iterations, we can obtain results that are close to what is correct.
I am very hurry. I choose an wrong answer about this question: In Schedule 6 - Working income tax benefit Do you wish to have the estimated GST/HST - Including related provincial credits and benefits credit? I should choose 'yes', bout I choose 'no'. What should I do? Can I change this in 'my account' at CRA? I hope somebody could help me! Thanks very much!