Credits where credits are due

To ensure the recovery of input tax credits on startup expenses, businesses should register for the goods and services tax without delay

When a business is in startup mode, it must cope with a multitude of new, often confusing, issues and procedures. In this context, it's not surprising that certain tax-planning opportunities may be overlooked, including the opportunity to claim input tax credits (ITCs) on startup expenses (which can run to thousands, and even millions, of dollars).

To claim an ITC for the 7% goods and services tax or the 15% harmonized sales tax (HST) paid on a business expense, the business must, generally, be a GST / HST registrant when the expense is …