Registration for start-up taxes: the €30,000 threshold explained

In short. In Quebec, you must register for GST and QST as soon as your taxable sales exceed $30,000 over four consecutive calendar quarters, or in a single calendar quarter. Below that threshold, you are considered a small supplier and registration remains optional. Once registered, you charge 9.975% VAT, for a total of 14.975%, and you recover the taxes paid on your purchases through input tax credits (ITCs) and input tax refunds (ITRs). A single application to the tax authority, which administers both taxes, provides you with your two registration numbers. All amounts are in Canadian dollars.

The $30,000 threshold is likely the most significant tax figure in the first twelve months of a Quebec business. Exceed it unintentionally, and the tax authorities can claim taxes you never charged; register at the right time, and you can even recover taxes paid on your start-up expenses. This 2026 guide explains the small supplier rule in plain language and then provides a simple, four-step rolling calculator to project the exact date registration becomes mandatory. For the complete cycle (collection, input tax credits and input tax refunds, remittances), consult our GST and QST guide for businesses in Quebec .

The rule for small suppliers: what the law says

The VAT schemes offer the same entry point: as long as you are a small supplier, registration is optional. You are a small supplier if your total taxable supplies do not exceed $30,000 over four consecutive calendar quarters, or over a single calendar quarter.

The details of the calculation often surprise startups:

• We count worldwide taxable sales, before expenses. It is the taxable revenue that counts, not the profit, and it includes tax-exempt supplies (taxable at 0%, such as certain exports).
• We add up the sales of your associates. If you control more than one related entity, their taxable sales are added to yours for the threshold test.
• We exclude certain sales. The sale of fixed assets (equipment, company vehicles) and exempt financial services are not included in the calculation.
• The quarter is calendar quarter, not fiscal quarter. January to March, April to June, July to September, October to December, regardless of the end date of your financial year.

Certain activities are not eligible for small supplier status. Taxi drivers and those providing paid passenger transport must register from the first dollar of income. For VAT purposes, the retail sale of tobacco, fuel, alcoholic beverages, new tires, or road vehicles also requires registration, regardless of turnover. If in doubt, check your situation with the tax authorities before your first sale.

The two ways to cross the threshold (and the date on which everything changes)

The exact moment you must start charging VAT depends on how you cross the threshold. Federal and Quebec rules are harmonized on this point, and the two scenarios do not trigger the same date.

In Quebec, the process itself is simple: Revenu Québec administers the GST and QST for most businesses in the province. A single online registration through Revenu Québec's business services provides you with your VAT number and your VAT identification number, both of which must appear on your invoices.

Projecting your obligation: the rolling calculator in 4 steps

No need for specialized software: a spreadsheet and your sales forecasts are all you need to transform the small supplier rule into a projection tool. This is the method we recommend to any startup.

• Step 1: Break down your taxable sales by calendar quarter. Include actual figures for past quarters and forecasts for future quarters. Exclude sales of fixed assets and include tax-exempt supplies.
• Step 2: Calculate the rolling total. At the end of each quarter, add together the last four quarters, i.e. the current quarter and the three preceding ones.
• Step 3: Apply both tests. Does a single quarter exceed $30,000? Does the rolling total exceed $30,000? The first test triggered defines your scenario.
• Step 4: Deduct your registration date. Exceedance in a single quarter: everything switches immediately. Cumulative excess: the status is maintained until the end of the month following the fourth quarter, then taxes apply from the next sale.

A numerical example: a service company launched in January 2026, whose sales are steadily increasing.

Verdict: the cumulative total exceeds €30,000 in Q4 2026, with no single quarter exceeding the threshold. The company therefore remains a small supplier until January 31, 2027, the month following the end of the fourth quarter. Its first sale in February 2027 must be subject to VAT, and the registration application must be submitted within 29 days. If, on the other hand, it were to secure a $31,000 contract in May, everything would change immediately: this sale would already be taxable, and registration would be due within 29 days.

Repeat this calculation at the end of each quarter with your actual figures, and once a month if you're approaching $25,000: that's your warning zone. To quantify the impact on your invoices once registered, our VAT calculator performs the calculation both ways, using the amount before or after taxes.

Once registered: charge 5% VAT and 9.975% VAT

In Quebec, a taxable sale incurs a VAT rate of 9.975%, both calculated on the pre-tax price, for a total charge of 14.975%. Some invoicing guidelines:

In return, registration gives you access to input tax credits (ITCs, for GST) and input tax refunds (ITRs, for VAT): you recover the taxes paid on your business purchases and only remit the net amount to Revenu Québec. The filing frequency depends on your annual sales: annually up to $1.5 million, quarterly from $1.5 million to $6 million, and monthly above that. Remember that the taxes collected belong to the tax authorities, not to you: set them aside as you receive them, ideally in a separate account. Meticulous bookkeeping greatly simplifies your first tax return.

Registering voluntarily before €30,000: a good calculation at the start?

Remaining a small supplier reduces paperwork, but voluntary registration is often the best choice from the outset:

• You can reclaim taxes on your start-up expenses. Equipment, computer, professional fees, software: the CTI and RTI reimburse you for the VAT paid, often several hundred dollars in the first year.
• You avoid the price shock later on. Going from 0% to 14.975% tax mid-year is noticeable; registering from the start makes the transition invisible to your customers.
• You project an established image. For business clients, tax numbers on the invoice are the norm, and your registered clients recover the taxes you charge them anyway.

The downside: once registered, you must invoice, declare, and pay taxes according to the schedule, even if your income remains modest. For individual customers, who cannot reclaim taxes, remaining a small supplier can maintain a price advantage of nearly 15%. This is exactly the kind of trade-off an accountant makes during a meeting; see also the signs that it's time to hire an accountant .

Côté budget, l'accompagnement comptable d'une entreprise coûte environ 3 000 $ par année en médiane, la plupart des mandats se situant entre 500 $ et 6 000 $ selon le volume et le secteur. Basé sur les honoraires réels de 1 248 mandats conclus via Bankeo (2024-2026), sur plus de 15 000 demandes reçues ; le Baromètre Bankeo détaille ces fourchettes par service. Vous pouvez aussi parcourir les comptables vérifiés du réseau Bankeo pour comparer les profils près de chez vous.

Frequently asked questions

What is a small supplier for VAT purposes?

A small supplier is a business whose worldwide taxable sales (yours and those of your associates) do not exceed $30,000 over four consecutive calendar quarters, or even in a single quarter. As long as you maintain this status, you are not required to register for VAT: you do not charge taxes, but you also do not claim input tax credits (ITCs) or input tax refunds (ITRs) on your purchases.

Is the $30,000 threshold calculated per calendar year?

No. The test is rolling: at the end of each calendar quarter, the taxable sales of the previous four quarters are added together. Therefore, the threshold can be crossed at any time of the year. The calculation is based on taxable sales before expenses, including zero-rated supplies, but excluding sales of capital assets and exempt financial services.

What happens if I exceed $30,000 in a single quarter?

You immediately lose your small supplier status. The sale that pushes you over the threshold is already taxable: you must collect VAT on it and then submit your registration application to Revenu Québec within 29 days. There is no grace period in this scenario, unlike when the threshold is accumulated over four quarters.

Do I need to register for VAT as soon as I create my business?

Not necessarily, except for certain targeted activities: taxi and paid passenger transport, and, for VAT purposes, retail sales of tobacco, fuel, alcoholic beverages, new tires, or road vehicles. Below the threshold, voluntary registration often remains advantageous at the start, as it allows you to recover the VAT paid on your start-up expenses through the CTI and RTI schemes.

What are the risks of registering late?

Revenu Québec can register you retroactively to the date you ceased to be a small supplier. The taxes you should have collected remain payable even if you haven't invoiced them: they are then deducted from your profit margin, with possible interest and penalties. Hence the advantage of projecting when you cross the threshold using the rolling calculation tool rather than discovering it after the fact.

How much does it cost to hire an accountant to handle registrations and taxes at startup?

L'accompagnement comptable d'une entreprise (tenue de livres, taxes, déclarations) coûte environ 3 000 $ par année en médiane, la plupart des mandats se situant entre 500 $ et 6 000 $ selon le volume et le secteur. Basé sur les honoraires réels de 1 248 mandats conclus via Bankeo (2024-2026), sur plus de 15 000 demandes reçues. Le Baromètre Bankeo détaille ces fourchettes service par service.

Official sources

1. Revenu Québec, VAT Registration
2. Revenu Québec, VAT and VAT;
3. Revenue Agency of the | Canada VAT for businesses
4. Quebec CPA Order