Tax advice

The GST and QST declaration for a self-employed worker

Many self-employed people in Quebec think they have to file their GST and QST directly in their tax return, but in reality they are two separate processes , even if they overlap. Here’s how it works:

GST/QST registration rules for a self-employed worker in Quebec

1. Small Supplier ($30,000 threshold)

If your taxable income (before taxes) is $30,000 or less in four consecutive quarters , you are considered a small supplier .
In this case :
- You are not required to register for GST and QST.
- You do not charge GST/QST to your customers.
- You cannot claim credits/refunds (CTI/RTI) on your expenses.

2. Exceeding the $30,000 threshold

As soon as your income exceeds $30,000 in a period of 12 consecutive months (or in a single quarter):
- You must register for GST and QST.
- The obligation begins from the first sale that exceeds the threshold .
- You have 30 days to make the official registration.

Important: If you still charge taxes without being registered, you will still have to remit them to Revenu Québec, even if you were not entitled to the credits!

3. Voluntary registration

Even if you are under $30,000, you can choose to register voluntarily.
This is advantageous if:

You have a lot of expenses with GST/QST (e.g. purchase of computer, office, equipment).
You want to recover these amounts in credits (CTI/RTI).
You want to appear more professional to your customers (especially in B2B).

4. How to register

Registration is done with Revenu Québec , which administers the GST and QST in Quebec (you do not have to go to the CRA for the GST if you reside in Quebec).
Means :
- Online via My Business Account (quick).
- By telephone with Revenu Québec.
- By paper form (LM-1).

5. Practical example

You start your business in January.
From January to September: $28,000 in income → no need to register.
In October, you issue an invoice for $3,000 → total of $31,000.
Starting with the October invoice, you must charge and collect the GST/QST.
You must officially register within 30 days of this date.

In summary:

≤ $30,000 → not mandatory, but possible voluntarily.
> $30,000 → registration required from the first sale that exceeds the threshold.
Registration is done with Revenu Québec (which also manages the GST for Quebec residents).

How to file a GST /QST return

1. Distinction between tax and duties

Income tax return (T1 / TP1) → Used to declare your income and expenses as a self-employed person (federal and provincial tax).
GST/QST Declaration → Used to remit the taxes you have invoiced to your customers, less those you have paid on your business expenses (tax credits).

Even though both returns are based on the same income and expenses, they are not filed at the same time or on the same form.

2. Income statement (net income)

In your tax return:

You enter your gross business income (federal line 13499 / provincial line 164).
You deduct your eligible expenses to calculate net income.
Please note : in your income and expenses, you do not include the GST/QST that you collected or paid.
Example: if you invoice $1,000 + taxes ($1,149.75), your gross income is $1,000 , not $1,149.75.

3. GST and QST declaration (remittances)

Separately from your tax return:

GST (form GST34) and QST (form FPZ-500) returns .
The frequency depends on your turnover:
- Quarterly (most common for a self-employed person).
- Annual (if sales < $1.5M and you have chosen this option).
- Monthly (if sales are high).

You write there:

GST/QST collected on your sales.
GST/QST paid on your eligible purchases (input tax credits).
You pay the difference to Revenu Québec (or receive a refund if your ITCs/RTIs > taxes collected).

4. Link between the two

income declared for tax purposes = income excluding tax – expenses excluding tax.
The tax return is made in parallel and does not directly modify income tax.
However, Revenu Québec cross-references your figures : your sales recorded in your GST/QST returns must correspond to those declared in your tax report.

5. Simple example

Billed revenue: $50,000 + $7,498 GST + $9,975 QST = $67,473 collected.
Expenses: $10,000 + $1,499.75 GST + $1,997.50 QST = $13,497.25 paid.
Tax return : You declare $50,000 of income and $10,000 of expenses = $40,000 of net taxable income.
GST/QST declaration :
- Taxes collected: $7,498 + $9,975
- Less taxes paid (ITC/RTI): $1,499.75 + $1,997.50
- Net Discount = $13,975.50.

In summary:

Your income and expenses excluding taxes go on your tax return.
Your collected/paid taxes go into a separate GST/QST return, usually filed via Revenu Québec’s My Account for Businesses .

Practical guide – GST and QST declaration for a self-employed worker in Quebec

1. Preparation before you start

Before completing your declarations, make sure you have:

Your total invoiced income excluding taxes for the period.
Details of the GST and QST collected on your sales.
Details of the GST and QST paid on your business purchases (invoices, receipts).
Your access to Revenu Québec’s “My Business Account” (or paper forms if you are not registered online).

2. Income tax return (federal and provincial)

1. In your T1/TP1 tax return:

- Line 13499 (federal) and line 164 (provincial) → enter gross income excluding taxes .
- Deduct your business expenses (excluding taxes).

2. Your net income is used to calculate your taxes and social security contributions (QPP, QPIP, RAMQ, etc.).
Do not include GST /QST in your income or expenses, as they are treated separately.

3. GST and QST declaration

You must produce:

GST (federal) : Form GST34 .
QST (provincial) : Form FPZ-500 (managed by Revenu Québec).

Steps in My Business Account:

1. Log in to My Account for Business → Taxes section .

2. Select File a QST/GST return .

3. Indicate the reporting period (monthly, quarterly or annual depending on your status).

4. Fill in:

- Total sales excluding tax .
- GST collected and QST collected .
- GST paid (ITC) and QST paid (ITR) on your eligible expenses.

5. The system automatically calculates the net discount (amount to be paid or refund).

4. Completed example

Income

Sales: $50,000
GST charged (5%): $2,500
QST invoiced (9.975%): $4,987.50
Total collected: $57,487.50

Expenses

Supplies: $10,000
GST paid: $500
QST paid: $997.50

Tax return result

Net GST to be remitted = 2,500 – 500 = $2,000
Net QST to be remitted = 4,987.50 – 997.50 = $3,990
Total to pay to Revenu Québec = $5,990

5. Deadlines

Quarterly (most common) : 1 month after the end of the quarter.
Annual (if your sales < $1.5M and you have chosen this option):
- Declaration due June 30 (if calendar year).
- Payment due April 30 (same deadline as personal tax).
Monthly : 1 month after the end of the month.

Late fees are significant (interest + fine), so always file even if you have nothing to pay.

6. Practical advice

Keep a separate record for your income excluding taxes, GST and QST.
Use accounting software ( QuickBooks , Sage, Excel with formulas) to avoid errors.
If you are just starting out and your turnover is < $30,000/12 months → you are considered a small supplier , tax registration is optional.
Revenu Québec cross-checks your income tax return and your GST/QST returns: make sure the figures match.

Correspondence between income tax return and GST/QST return

1. Box 103 (GST/HST collected)

It is not directly a figure from the tax return.
You must calculate the GST collected on your taxable sales .
Example: Gross revenue excluding taxes (line 13499 federal / line 164 Quebec) × 5%.
If you have tax-free (zero%) or exempt sales, they do not go here.

2. Box 106 (GST paid on purchases – ITC)

This is the GST paid on your eligible business expenses (input tax credit).
In your tax return, you deduct expenses excluding taxes .
Here, you recover the portion of GST paid on these same expenses.

Please note: some expenses (e.g. 50% meals, car for personal use) only qualify for part of the ITC.

3. Box 203 (QST collected)

Same logic as box 103, but for QST .
Gross income excluding tax × 9.975%.

4. Box 206 (QST paid on purchases – RTI)

Same logic as box 106, but for QST .
Portion of QST paid on your eligible business expenses (reimbursed via RTI).

Simple summary

Income tax return (T1/TP1)	GST/QST Declaration
Gross income (line 13499 fed . / line 164 QC)	Used to calculate 103 (GST) and 203 (QST)
Expenses excluding taxes	Deducted for tax purposes and used to calculate 106 (GST) and 206 (QST)
Net income (income – expenses)	No direct box: this is only for your taxes, not for GST/QST

Practical example

Business income declared for tax purposes: $50,000 (excluding taxes)
GST collected (box 103): 50,000 × 5% = $2,500
QST collected (box 203): 50,000 × 9.975% = $4,987.50
Expenses excluding taxes: $10,000
GST paid (box 106): 10,000 × 5% = $500
QST paid (box 206): 10,000 × 9.975% = $997.50

How to File GST and QST for an Uber Driver

How to declare GST and QST for an Uber driverFor an Uber driver in Quebec, the declaration of GST (federal) and QST (provincial) is done the same as for any self-employed person registered for taxes, but with a few special features:

1. Registration Requirement

All Uber drivers in Québec must register for GST (federal) and QST (provincial) from the very first dollar earned (the usual $30,000 exemption does not apply).
Uber assists with the initial registration and provides you with your tax numbers.

2. Collecting and Remitting Taxes

Passengers pay GST (5%) and QST (9.975%) on each ride.
Uber collects these taxes from the riders and remits them to the driver.
As the driver, you are responsible for filing the tax return and sending the net taxes to the government.

3. Input Tax Credits (ITCs) and Refundable Tax Credits (RTCs)

You can claim back the GST/QST paid on expenses related to your Uber business, such as:

Gas and car maintenance
Repairs and insurance
Mobile phone (business portion)
Uber’s service fees and commissions (which include GST/QST)

4. Filing the Return

File online via My Account for Businesses – Revenu Québec, or
Use the combined paper return (FPZ-500).

You must report:

GST/QST collected (from passengers through Uber).
GST/QST paid on expenses (your ITCs/RTCs).
The difference = net tax to remit (or refund if credits exceed collections).

5. Example

For a quarter:

GST/QST collected: $1,000
GST/QST paid on expenses: $300

Net tax payable = $1,000 – $300 = $700

The quick method for GST/QST is often misunderstood, but it can be very advantageous for a self-employed person or a small business. I’ll explain it to you clearly:

The quick method for GST/QST (Quebec)

1. What is the quick method?

This is a simplified method of calculating the GST and QST to be remitted.
You are not claiming your ITC/RTI (credits/refunds of taxes paid on your expenses).
Instead, you apply a predetermined reduced rate to your taxable sales to calculate how much to remit.
You keep the difference as additional profit .

In other words, you collect the full GST/QST from your customers, but you only have to remit a lower percentage to Revenu Québec.

2. Who can register?

You must be registered for GST and QST.
Your taxable sales (including those of your partners, if applicable) must be $400,000 or less per year (before taxes).
You must not carry out excluded activities (e.g., certain financial services, real estate sales, registered charities have different rules).

3. In what cases is it advantageous?

When you have few expenses with GST/QST to recover.
Typical example:
- Professional services consultant, freelancer, accountant, self-employed who works primarily from home.
- You have a lot of taxable income, but few major purchases with taxes.
This allows you to keep some of the taxes collected as additional income.

If you have large expenses (e.g. purchase of expensive equipment, vehicle, offices), the ordinary method is often more advantageous, because you recover the GST/QST paid.

4. How to register?

You must request it from Revenu Québec:
- In My Account for Online Business .
- By phone.
- Or by checking the box on the LM-1 registration form (if you are registering for the first time).
Registration is not automatic, you must choose the quick method.
The choice is valid for at least 1 year , and you must use it for all your declarations during this period.

5. How to file the declaration using the quick method?

You continue to charge GST (5%) and QST (9.975%) normally to your customers.
In your declaration, you do not return 100% of these amounts, but rather a reduced percentage:

Discount rates (effective 2025):

GST : approximately 3.6% (instead of 5%).
QST : approximately 6.6% (instead of 9.975%).

( rates vary slightly depending on your sector of activity, Revenu Québec publishes an official table each year)

Example :

Income excluding taxes: $100,000
Taxes charged to customers: $5,000 (GST) + $9,975 (QST) = $14,975
With the ordinary method → you would have to remit almost everything, except your CTI/RTI.
With the quick method →
- GST to be remitted = 100,000 × 3.6% = $3,600
- QST to be remitted = 100,000 × 6.6% = $6,600
- Total to remit = $10,200
  You keep $4,775 as a benefit (as long as your expenses are low).

6. Practical declaration

The declaration form remains the same (FPZ-500 for QST).
In boxes 103 and 203 (GST/QST collected), you continue to enter the taxes invoiced.
In the special Quick Method section , you enter your sales and apply the reduced rate .
The final calculation replaces the CTI/RTI (boxes 106 and 206 are then neutralized).

In summary :

The quick method is advantageous if you have a lot of income and few taxable expenses .
You keep a portion of the taxes as additional income.
Registration is done with Revenu Québec and must be maintained for at least 1 year.
The declaration is made on the same forms, but with reduced discount rates .

■ Comparative Table – GST/QST: Regular Method vs Quick Method

Items	Regular Method	Quick Method
Sales before tax	$100,000	$100,000
GST charged to clients (5%)	$5,000	$5,000
QST charged to clients (9.975%)	$9,975	$9,975
Total taxes collected	$14,975	$14,975
Expenses before tax	$10,000	$10,000
GST paid on expenses (5%)	$500	–
QST paid on expenses (9.975%)	$997.50	–
Total taxes paid	$1,497.50	–
GST to remit	$4,500	$3,600
QST to remit	$8,977.50	$6,600
Total to remit	$13,477.50	$10,200
Amount kept by the business	$1,497.50	$4,775

■ Summary:
– The Regular Method is beneficial if you have many expenses with taxes (equipment, office, etc.).
– The Quick Method is beneficial if your expenses are low, since you keep a larger portion of the taxes collected.

For any questions, you can call Revenu Québec at 1-800-567-4692

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