The $30,000 threshold explained. Two tests, zero guessing. Know exactly when CRA requires you to collect HST.
As a Canadian sole proprietor, freelancer, or contractor, you are considered a small supplier and do not have to register for GST/HST until your business revenue exceeds $30,000. Once you cross that threshold, you must register and start collecting HST from your clients.
The $30,000 threshold applies to your worldwide taxable revenues from all commercial activities. It does not include GST/HST you collect on invoices -- it is the base amount before tax.
You must register when you exceed $30,000 in a single calendar quarter, OR when you exceed $30,000 over four consecutive quarters. Whichever happens first triggers mandatory registration.
If your revenue in any single calendar quarter (January to March, April to June, July to September, or October to December) exceeds $30,000, you must register for HST immediately. You are required to start collecting HST on the very next invoice after you cross the threshold.
Example: You earn $28,000 in April and $5,000 in May. On the invoice that pushed you over $30,000 in Q2, you must start charging HST.
Even if no single quarter exceeds $30,000, you must register if your total revenue over any four consecutive quarters exceeds $30,000. The four quarters do not need to be a calendar year -- they can start at any point.
Example: Q3 2025 to Q2 2026 combined revenue = $32,000. Even though no single quarter hit $30,000, you have crossed the threshold and must register.
If you drive for Uber, Lyft, Skip the Dishes, DoorDash, or any other rideshare or delivery platform, the $30,000 threshold does NOT apply to you. You are required to register for GST/HST from your very first fare or delivery. There is no small supplier exemption for rideshare drivers. This is a CRA rule that catches many new drivers off guard.
Not all revenue counts toward the $30,000 threshold. Here is what does and does not count:
If you were required to register for HST but did not, CRA can assess you for HST you should have collected -- even if you never charged your clients. You become personally responsible for the HST on all revenue earned after you crossed the threshold.
This is why tracking your revenue closely is critical. Once you know you are approaching $25,000 in annual revenue, start monitoring monthly. At $28,000 to $29,000, prepare to register.
You can register for HST voluntarily even before you hit $30,000. This makes sense if you have significant business expenses with HST, because you can claim Input Tax Credits (ITCs) and get that HST back. Many new businesses register voluntarily from day one for this reason.
The trade-off is administrative overhead. You will need to file HST returns (quarterly or annually) and track HST collected and paid carefully.
The rate you charge depends on the province where your client is located (place of supply), not where you are based.
SnapBooks automatically tracks your HST collected and ITCs paid, and alerts you when you are approaching the $25,000 and $30,000 thresholds. Built for Canadian sole proprietors filing T2125.
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