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Indirect Tax: Tips on how to Improve your Cash Flow During COVID-19

29/04/2020


As your business navigates COVID-19, maintaining and improving cashflow is critical to sustaining operations. In a three-part video series, our Indirect Tax team outlines cashflow strategies you can use to support your business.

  1. GST / HST Filing Frequency
  2. Intercompany Transactions (RC4616)
  3. Bad Debt Recovery

In our first video, we discuss how changing your GST / HST filing frequency could improve your cashflow.

Depending on your operation, changing your frequency means you’ll receive refunds sooner, or be required to pay the tax later. This simple change can provide significant flexibility over the coming weeks and months.

Example:

If you are in the exporting business, your supplies are generally subject to GST / HST at the rate of zero percent. Although you are not collecting GST/HST, you may be paying the tax on your related expenses, which could be recovered as input tax credits.

So, if you are filing your GST returns every quarter, you are only receiving four refund cheques a year. By changing your filing frequency, you may get your refunds faster.

If you have any questions about the topics discussed, or any sales tax questions, contact:

Edward Chow, CPA, CGA
Manager, Indirect Tax
[email protected]
778.372.5365

Angela Chang, CPA, CGA
Partner, Indirect Tax 
[email protected]
778.374.2121

Norma Orellana
Senior Manager, Indirect Tax
[email protected]
604.949.2116

Learn more at MNP's COVID-19 Business Advice Centre

Strategies and tools to help your company navigate the coronavirus crisis, stay resilient and take the next steps towards recovery.