Once you've registered for GST/HST, you have two options for how you remit it to the CRA: the Regular Method and the Quick Method. Most accountants mention both. Fewer explain clearly which one actually saves you money.
Here's the breakdown.
The Regular Method
With the regular method, you collect GST/HST from your clients, then subtract any Input Tax Credits (ITCs) — the GST/HST you paid on business expenses — and remit the difference to the CRA.
Example: You collect $5,000 in HST from clients. You spent $800 in HST on software, equipment, and office supplies. You remit $5,000 − $800 = $4,200.
This method benefits you most when you have significant GST/HST-taxable business expenses — things like equipment, software subscriptions, or subcontractors who charge HST.
The Quick Method
With the Quick Method, you collect GST/HST from clients at the full rate (13% in Ontario, for example), then remit a lower flat percentage to the CRA and keep the difference.
The flat rates vary by province and type of business. For service providers (most freelancers), the rates are:
- Ontario, NS, NB, PEI, NL (HST provinces): 8.8%
- BC, MB, SK, AB, and territories (GST only): 3.6%
- Quebec (GST portion only): 3.6%
There's also a 1% credit on the first $30,000 of revenue in your fiscal year.
A worked example — Ontario freelancer
Say you're a freelance developer in Ontario with $80,000 in revenue. You collect 13% HST from clients = $10,400 collected.
Regular Method: You remit $10,400 minus your ITCs. If your HST-taxable expenses total $3,000 (software, equipment, etc.), you pay $10,400 − $390 (13% of $3,000) = $10,010.
Quick Method: You remit 8.8% of $90,400 (revenue plus HST collected) = $7,955. Minus the 1% credit on the first $30,000 = $7,955 − $300 = $7,655.
Saving: $10,010 − $7,655 = $2,355 in this example.
The Quick Method wins here because this freelancer has low business expenses. The less you spend on HST-taxable inputs, the more the Quick Method saves you.
When the Regular Method wins
The Regular Method wins when your HST-eligible business expenses are high. For example, if you hire subcontractors who charge HST, buy expensive equipment, or have a significant software stack, your ITCs can be substantial enough to beat the Quick Method flat rate.
As a rough rule: if your HST-taxable expenses are more than about 30% of your revenue, run the numbers on both. Below that, the Quick Method usually wins for service providers.
How to choose
- Estimate your annual revenue
- Estimate your HST-taxable business expenses
- Calculate both methods with your provincial rate
- Pick the one that results in a lower remittance
You elect the Quick Method by filing Form GST74 with the CRA. You can switch methods, but only at the start of a new fiscal year.
HST Hero's Quick Method calculator does this comparison automatically by province — plug in your revenue and expenses and it shows you the difference.
Who can't use the Quick Method
Not everyone qualifies. You can't use the Quick Method if you:
- Are a listed financial institution
- Provide legal, accounting, or actuarial services
- Are a not-for-profit organization
- Had more than $400,000 in annual taxable supplies in the previous year
For most Canadian freelancers — developers, designers, consultants, writers, photographers — the Quick Method is available and usually worth it.