Canada HST Tax Information (Ontario)
What is HST?
HST stands for Harmonized Sales Tax. Provincial Sales Tax (PST) will be replaced, along with the current Goods and Services Tax (GST) to create one tax (HST). It will go into effect On July 1st, 2010. The provincial portion of the HST will be 8% and the federal portion will be 5%, for a combined HST rate of 13%.
Right now there are certain things that are NOT charged PST (8%), and when the HST goes into effect, you will end up paying that 8%. Over 80% of services and items you currently buy will see no change, but there are quite a few that will change.
Here is a list of the things that you will now have to pay more tax on:
– Dry Cleaning Services
– Alcoholic Beverages (although sales tax on alcohol is decreasing, other alcohol fees & taxes are changing to continue to support social responsibility)
– Electricity & Heating
– Internet Access
– Home Service Calls: electrician, plumber, leaky faucets, etc.
– Landscaping, Lawn Care & Private Snow Removal
– Hotel Rooms
– Domestic Air, Rail & Bus Travel Originating in Ontario
– Magazine Subscriptions
– Home Renovations
– Private Resale of Car (including registration)
– New Homes Over $400,000
– Real Estate Commissions
– Massage Therapy
– Green Fees for Golf
– Gym & Athletic Memberships
– Lessons for Ballet, Karate, Hockey, etc.
– Tickets for Live Theatre with Less Than 3,200 Seats
– Hockey Rink & Hall Rental Fees
– Fitness Trainer
– Hair Stylist
– Esthetician Services
– Funeral Services
– Legal Fees
– Nicotine Replacement Products
– Hunting & Fishing Licences
To help families and individuals transition to this new tax, the government is giving eligible Ontario tax filers (aged 18 and older) transition payments.
You will receive three tax free payments, scheduled for June 10th, 2010, December 2010 and June 2011. If you receive your income tax refund by direct deposit, you can expect to see your transition payments in your bank account as well. If not, you will receive a cheque in the mail.
– Eligible families, including senior couples and single parents, with an annual income below $160,000 will receive 3 payments totalling $1,000.
– Eligible individuals with an annual income below $80,00 will receive 3 payments totalling $300.
To qualify for the two payments scheduled in 2010, you will have to file a 2009 tax return. A 2010 tax return will have to be filed to qualify for the June 2011 payment.