Ontario Retail Sales Tax is generally chargeable on the sale of "tangible personal property" to the ultimate consumer of the goods being sold. In return for collecting the tax, the vendor is entitled to retain a small amount (currently generally 5 % to a maximum of $1500 per year), which is income to the vendor. The vendor, be it a person (sole proprietor), corporation or partnership, must apply for a vendor permit from the Minister of Finance of Ontario.

The tax is deemed to be collected as of the invoice date, or the date of sale where there is no invoice. The vendor is generally required to remit the tax to the Minister of Finance of Ontario on or before the 23rd day of the following month. In cases where the taxable sales of the vendor are very low, remittances may be permitted on a less frequent basis.

Tax is also deemed to be charged and payable in the case where the vendor itself consumes its own goods. An example of this might be a furniture retailer taking stock from inventory for its own use.

Collection and remittance of Ontario Retail Sales Tax is generally a simple procedure. However, as one would suspect of any taxation system, it can become complicated in certain instances, such as inter-provincial sales. For this reason it is important to read the literature provided upon registration as a vendor to ensure compliance. Registration forms can be requested by dialing the Minister of Finance Forms and Publications number: 1-800-668-9938.

Logan Katz LLP provides further assistance to clients with recording and remitting taxes properly and ensuring compliance with government regulations.

The above provides general information only. It should not be regarded or relied upon as accounting or taxation advice or opinions. Logan Katz LLP Chartered Accountants would be pleased to provide more information or specific advice on matters of interest to you.
 

All contents are Copyright © 2003, Logan Katz LLP Consulting Inc. All Rights Reserved.