Close a GST/HST account in Canada: when you can deregister, the one-year rule for small suppliers, Form RC145, the final return and two reporting periods, and the tax on property still held at closing.
Applies in: across Canada
Closing a GST/HST account is a notification plus a final return, not a decision to stop filing. Until you tell the CRA, the account stays open, returns keep arriving, and the CRA expects them filed. The notification is made online in My Business Account or by mailing Form RC145, and it must state the business number, the legal name, the cancellation date, and the reason for closing. The final return then settles the account, including tax on property still held for the business at closing. The most expensive mistake is the quiet one: stopping work, stopping filing, and assuming the account closed itself. It did not, and the returns, balances, and interest keep accumulating until the CRA is told.
This guide covers closing the GST/HST account only. Closing the business itself involves provincial registration, municipal licences, payroll and corporation income tax accounts, and dissolution or wind-up steps that are separate from the GST/HST account, and Quebec businesses must also close the QST account with Revenu Québec.
The CRA asks why you no longer need a GST/HST account, and the reason changes what happens next. The reasons the CRA lists are: closing the business, selling the business, being a small supplier, being a public service body that is a small supplier, no longer making taxable supplies, filing for bankruptcy, being in receivership, merging or amalgamating, the death of a sole proprietor, and a partner retiring or passing away. Gather the business number, the legal name of the business, the cancellation date, and the reason before you start the notification, because all four are required.
The cancellation date is normally the day the business closes, for a business closing. For a small supplier deregistration, the date is the date you ask the account to close, subject to the one-year rule below. For a sale, the date follows the sale and any joint election. Get the date right, because the final reporting periods are built around it: the first final period ends the day before closing, and the second, if needed, begins on the closing day. A wrong date produces wrong periods, and wrong periods produce returns the CRA has to reprocess.
Not every registrant can close the account on request. If you are deregistering because you have become a small supplier again, you need to have been registered for at least one full year before you ask to close the account. The same one-year requirement applies to a public service body that is a small supplier, including charities and public institutions measured under their own small-supplier tests. The one-year limit does not apply where another situation arises, for example where the business stops making taxable supplies or ceases to operate. In that case, if the business is no longer required to be registered, it should cancel its registration immediately.
Two groups cannot use small-supplier status to deregister at all. A taxi operator or a commercial ride-sharing driver must register and remain registered for GST/HST even as a small supplier, and a non-resident performer selling admissions to seminars and other events must do the same. If either description fits, do not file a closure request on small-supplier grounds. The account stays open, and the filing obligations continue.
If the business is being sold rather than closed, check the joint election before you close anything. You may be able to elect jointly with the purchaser to have no GST/HST payable on the sale of the business or part of it, if the conditions are met. The purchaser must acquire at least 90 percent of the property necessary to carry on the business or part of it, any property the recipient needs but did not acquire under the agreement must fall within the remaining 10 percent of the fair market value of all property acquired, and the election cannot be used if you sell only individual assets or if you are a registrant and the recipient is not. The election is made on Form GST44. A selected listed financial institution uses Form RC7244 for this election instead of Form GST44. If you intend to carry on another business activity after the sale, call the CRA at 1-800-959-5525 to determine whether you can continue to use the current business number or need a new one.
Closing the account triggers a deemed sale of property held for the business, and the tax on that deemed sale belongs on the final return. For property other than capital property held for consumption, use, or supply in a commercial activity, the CRA considers that you have sold each property and collected GST/HST on the sale. Remit the GST/HST on the fair market value of each of those properties just before you close the account, and report it on the final return. Inventory, supplies on hand, and similar property fall in this group.
For capital property held for use in commercial activities, the CRA considers that you have sold each capital property immediately before closing the account and collected tax equal to the basic tax content of the property at that time. Use the change-in-use rules for the property to determine whether tax is owing, include the tax considered collected in the net tax calculation on the final return, and expect that generally all or part of the input tax credits previously claimed on the property must be repaid. This is the part of a closure that most often surprises a business owner, because property already paid for can still produce a final tax amount.
Adjust input tax credits for services, rents, royalties, and similar payments as well. You cannot claim input tax credits for rent, royalties, or similar payments that relate to the period after you close the account, and you must adjust the net tax calculation on the final return if you have claimed credits for GST/HST on those payments. You may still be eligible to claim a credit for GST/HST that becomes payable after closing for services, rent, royalties, or similar payments relating to a period before you ceased to be a registrant. Work through each prepaid or recurring payment against the closing date rather than applying one rule to all of them.
Choose one route. Online, sign in to your CRA account and select Business to access My Business Account, or Representative to access Represent a Client, and follow the close-account path for the GST/HST account. By mail, fill out Part B and other applicable sections of Form RC145, Request to Close Business Number Program Accounts, and send the completed form to your tax centre within six months of the date you signed the form. A form signed more than six months before it reaches the tax centre is stale, so date the form when you are ready to send it.
Non-resident businesses and selected listed financial institutions have their own routes. A non-resident business that provided security when it registered must inform the Non-Resident Registration and Security Section. A selected listed financial institution for GST/HST or QST purposes, or both, must complete Form RC7345 instead of Form RC145. If either description fits, do not use the standard form and assume it will be processed.
Bankruptcy and receivership follow their own notice rules on the same page. A business filing for bankruptcy must send its tax services office a copy of a court-issued Assignment in Bankruptcy, a Bankruptcy Notice, or correspondence entitled First Meeting of Creditors, and the business number will usually be closed after discharge. A person who engages in a new business activity outside the estate beginning the day after assignment into bankruptcy is considered a new entity and requires a new business number and GST/HST account. A proposal in bankruptcy is not the same as filing for bankruptcy: the account is not closed automatically, and copies of all proposal documentation should be forwarded to the tax services office. A receiver may use the existing GST/HST account or open a separate one under the existing business number, and most receiverships end with the business activities ending and the business number closing.
File the final GST/HST return and remit any amount owing. You are considered to have two separate reporting periods when you close the account, because you may continue to receive revenue earned before closing. File a return for the reporting period that ends the day before you close the account, and a return for the reporting period that begins the day you closed the account and ends on the last day of that month. The second return is only required if you have tax to remit for that period. If no tax is owing for the short period after closing, the second return is not required, but the first final return always is.
Death and partnership changes have their own final-period rules. When a sole proprietor passes away and the commercial activity has ceased, the GST/HST account must be closed and a final return filed for a reporting period ending on the day the individual died, due one month after the end of that period. Where the estate has tax to remit and continues to use the account, two returns are generally required, one ending on the day of death and one for the estate period beginning the next day and ending on the day the reporting period would have ended if the individual had not died, and both returns are due one month after the end of their reporting period. When a partnership ends, the GST/HST account must be closed and a final return filed, although a change of partners does not always end the partnership or require a new business number, depending on the partnership agreement. In both cases, contact the CRA promptly with the date of death or the change, rather than leaving the account to generate expected returns.
After closing, keep the closure confirmation, the final returns, the working papers for the property valuations and credit adjustments, and the rest of the business records with the business records. The CRA can ask for records after the account is closed, and the closure confirmation is the document that proves the account ended on the date you gave. If correspondence about filing keeps arriving after closure, check whether it relates to a period before the cancellation date or to another program account that is still open, such as payroll or corporation income tax, before assuming the closure failed.
Notify the CRA and give the reason for closing, then file a final GST/HST return and remit any amount owing. Close the account online by signing in to your CRA account and using My Business Account or Represent a Client, or by mail by filling out Part B and other applicable sections of [Form RC145](https://www.canada.ca/en/revenue-agency/services/forms-publications/forms/rc145.html), Request to Close Business Number Program Accounts, and sending it to your tax centre within six months of the date you signed the form. Until the CRA is notified, you will keep receiving GST/HST returns and the CRA will expect you to file them.
A sole proprietor, partnership, or corporation that is a small supplier may ask to deregister if total taxable revenues fall below the small-supplier limit calculation amount, but must have been registered for at least one full year before asking to close the account. Taxi operators and commercial ride-sharing drivers must register and remain registered even if they are small suppliers, and the same exception applies to non-resident performers selling admissions to seminars and other events.
Yes. You are considered to have two separate reporting periods when you close your account. File a return for the reporting period that ends the day before you close the account, and a return for the reporting period that begins the day you closed the account and ends on the last day of that month, but the second return is only required if you have tax to remit for that period. Report the tax on property held at closing on the final return.
The CRA treats you as having sold each property, other than capital property, that you held for consumption, use, or supply in a commercial activity, and as having collected GST/HST on those sales. Remit the GST/HST on the fair market value of each of those properties just before closing, on your final return. For capital property, you are treated as having sold it immediately before closing and as having collected tax equal to its basic tax content, with the change-in-use rules deciding whether tax is owing, and generally all or part of the input tax credits previously claimed on the property must be repaid.
No. Closing the account takes effect on the cancellation date you give the CRA, and the final return covers activity up to the day before closing, with a possible second short period after it. Keep charging, collecting, and reporting GST/HST on taxable supplies made while you are still registered, and stop only once the registration has ended. If you stop charging while still registered, the tax is still payable on those supplies.
Tell the CRA the reason is a sale, and check the joint election to have no GST/HST payable on the sale of the business or part of it. The purchaser must acquire at least 90 percent of the property necessary to carry on the business or part of it, and the election cannot be used if you sell only individual assets or if you are a registrant and the recipient is not. Make the election on [Form GST44](https://www.canada.ca/en/revenue-agency/services/forms-publications/forms/gst44.html). If you intend to carry on another business activity after the sale, call the CRA at 1-800-959-5525 to determine whether you can keep the current business number or need a new one.