GST/HST Resource

  • GST/HST Resource

What Canadian Businesses Need to Know

If your business buys software, AI tools, cloud services, or other digital products from non-resident suppliers, you could be paying GST/HST that may not be recoverable. Understanding these rules can help you avoid denied Input Tax Credits (ITCs), CRA reassessments, and unnecessary tax costs.
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Why does this happen?

Since July 1, 2021, many non-resident suppliers selling digital goods and services in Canada register under CRA’s Simplified GST/HST Registration System.

If a supplier is registered under this system, GST/HST charged on your purchase is generally not eligible for an Input Tax Credit (ITC).

Common digital services

This may include:

AI toolsSaaS subscriptionsCloud hostingMarketing platformsDesign softwareVideo conferencingOnline educationOther digital subscriptions

Common digital services

The last four digits of a supplier’s GST/HST number tell you how the tax should be treated.

GST/HST NumberWhat it means
RT0001GST/HST is generally eligible for an ITC, subject to normal GST/HST rules.
RT9999GST/HST is generally not eligible for an ITC under CRA's Simplified GST/HST system.

What should you do?

If your business is GST/HST registered:

  1. Provide your GST/HST registration number to the supplier.
  2. Ask the supplier to stop charging GST/HST on future invoices, where applicable.
  3. Request a refund or credit for GST/HST charged on previous invoices, if available.
  4. Keep copies of all correspondence for your records.

How Transcounts can help

We can review your digital suppliers, identify potential GST/HST issues, and help ensure your bookkeeping and GST/HST filings stay compliant — so you keep the credits you're entitled to and avoid surprises at filing time.

Frequently asked questions

Can I claim an ITC if the supplier's GST/HST number ends in RT9999?

Generally, no. GST/HST charged under CRA’s Simplified GST/HST Registration System is not eligible for an Input Tax Credit.

What does RT9999 mean?

It indicates the supplier is registered under CRA’s Simplified GST/HST Registration System for certain non-resident businesses.

Can I recover GST/HST charged in previous years?

Possibly. Provide your GST/HST registration number to the supplier and ask whether they can issue a refund or credit. This depends on the supplier’s policies and ability to adjust their GST/HST reporting.

How can I avoid this issue in the future?

Provide your GST/HST registration number to non-resident suppliers before or as soon as you create your account, to help ensure GST/HST is not charged where appropriate.

Does this apply to all foreign suppliers?

No. It generally applies to suppliers registered under CRA’s Simplified GST/HST Registration System. Suppliers with a standard GST/HST registration (typically ending in RT0001) generally follow the normal GST/HST rules.

Not sure if your digital subscriptions are affecting your GST/HST returns?

Contact the Transcounts team for a review of your GST/HST compliance and digital supplier setup.

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