ITC and ITR (Input Tax Credits)

The ITC (Input Tax Credit, at the federal level) and the ITR (Input Tax Rebate, in Quebec) allow a tax-registered business to recover the GST and QST paid on its business purchases (its "inputs"). This reduces the taxes payable to the government.

Brief

CTI = input tax credit (the federal share, for the 5% GST rate)
RTI = input tax refund (Quebec's share, for the 9.975% QST)
"Inputs" simply means your business purchases: supplies, equipment, services
They reduce the taxes you pay to the tax authorities; keep each receipt as proof
Vous avez généralement jusqu'à quatre ans pour réclamer un CTI ou un RTI oublié, à condition d'avoir gardé la facture

Why does this matter?

In practical terms: you buy a computer for $1,000 plus $50 GST/QST and $99.75 GST/QST for your business. Thanks to the CTI and RTI, this $149.75 in taxes is returned to you instead of remaining an expense. Each period, you subtract the taxes paid on your purchases from those collected on your sales, and you only remit the difference. Forgetting to claim them means paying more tax than necessary; making a mistake (meals only qualify for 50%, for example) will trigger an audit. Bankeo will connect you with a verified accountant/CPA free of charge to calculate them and keep your records in order, and we'll be there to support you.

Le CTI et le RTI sont l'autre versant de la TPS et de la TVQ : d'un côté vous percevez la taxe sur vos ventes, de l'autre vous récupérez celle payée sur vos achats, et vous ne remettez que l'écart. Sur un trimestre où vous percevez 3 000 $ de taxes et en payez 1 100 $ sur vos dépenses d'affaires, vous ne versez que 1 900 $. Bon à savoir : vous avez en général jusqu'à quatre ans pour réclamer un crédit oublié, et notre calculateur TPS-TVQ chiffre le tout en quelques secondes. Les règles et les pièces justificatives exigées sont détaillées par l'Agence du revenu du Canada. Ni trop réclamer, ni rien oublier : Bankeo vous présente sans frais le comptable qui s'en assure et vous accompagne, toujours.

Frequently asked questions

What exactly is it?

This is the mechanism that reimburses you for the GST/QST paid on your business purchases. You recover these taxes instead of absorbing them as an expense, as long as the purchase is for your business and you keep the invoice.

On which purchases can I claim a CTI or an RTI?

For purchases related to your business: supplies, equipment, commercial rent, services. A compliant invoice is required. Certain expenses are subject to limits, such as meals and entertainment, which are only 50% recoverable.

What is the difference between CTI and RTI?

The CTI recovers GST/QST (federal tax of 5%), while the RTI recovers GST/QST (Quebec tax of 9.975%). Both are calculated together on the same return to Revenu Québec. Bankeo will connect you with a verified accountant/CPA free of charge to ensure nothing is overlooked, and we'll be there to support you every step of the way.