Consultant tax filings where the client's address sets the tax.

Who you invoice decides the rate

For consulting and development services, the GST/HST place-of-supply rules generally attach the rate to the recipient's business address obtained in the ordinary course of business. Where the servers live, where the end users sit and where you type are all irrelevant. The whole rule fits in one table:

The agency row is the one that surprises people. If a staffing firm holds your contract and pays your invoices, the agency is the recipient of your supply, and its Canadian address sets the rate no matter whose logo is on the project. We confirm the recipient on each contract once, then the invoicing runs itself.

Zero-rated is not exempt, and the difference pays you

Billing a non-resident client at 0% is zero-rating, a feature of Canadian HST law, and it is the good kind of 0%: your input tax credits on software, hardware and overhead remain fully claimable. Zero-rated sales still count toward the $30,000 small-supplier threshold, and staying registered is usually worthwhile precisely because the credits keep flowing while no tax is collected.

The export rules have exceptions, including services rendered to individuals while they are in Canada and services connected to real property here, and the CRA expects evidence of the client's non-resident status on file, not assumed. We verify the conditions per contract and keep that evidence with the return. Our lane stops at the border: we file the Canadian side, and if a client's home country asks something of you, we will flag it as worth professional attention there, not file it from here.

The quick method exists for exactly this cost profile

Consultants collect a lot of HST and spend very little that carries HST, which is the profile the quick method rewards. An Ontario service business that elects it remits 8.8% of its tax-included sales instead of tracking every credit, keeps a 1% credit on the first $30,000 of eligible sales each year, and still claims full ITCs on capital purchases like computers. The election is available while annual taxable sales stay at or under $400,000.

It is not automatic arithmetic in your favour. Heavy zero-rated export billing sits outside the remittance calculation and can flip the answer, and a year with a large equipment refresh changes it again. We re-run the comparison every year and file the election, or unwind it, on numbers rather than folklore.

A lean T2 still has sharp corners

A one-person corporation's T2 looks small and behaves like a big one: GIFI statements, the small business deduction schedule, shareholder information, and instalments that start once tax payable passes $3,000, quarterly for eligible small CCPCs. The return is due six months after year-end but the balance is due at three for most CCPCs claiming the small business deduction, a gap that catches consultants who file early and pay late. Our Corporate Tax Filing work runs the corporate return and the owner's personal return together, so T4 or T5 slips issued in February match what the bank account says actually moved.

One more corner for builders: if you spent bench time building your own product, some of that work may support an SR&ED claim, and the T661 rides the T2 with a hard deadline of 18 months after year-end, no extensions. Development done under contract for a client is usually the client's claim, not yours, so we assess honestly before anyone budgets a refund.

When a letter asks about the zero rate

The review that actually reaches consultants is a GST/HST desk query about a return with high ITCs and little tax collected, which is simply what an export-heavy year looks like. Because the non-residence evidence and contracts were filed with the working papers, CRA Audit & Review Support answers from the file, and most of these end at the first reply.

Source: CRA — GST/HST for businesses.