Can I cancel my HST registration if my business revenue drops below $30,000?

Yes, you can apply to cancel your GST/HST registration once your annual taxable revenues have been below $30,000 for four consecutive calendar quarters. You must file a final HST return covering the period up to the cancellation date and remit any amounts owing, including any HST adjustments for capital property you hold at the time of deregistration.

When you cancel your registration, there is an important tax catch: you are deemed to have collected HST on any capital property and inventory you hold at the time of cancellation, based on fair market value. If you claimed ITCs when you bought that property and are now deregistering, the CRA effectively "claws back" those credits through this deemed supply rule. This can result in an unexpected amount owing on your final return.

You cannot cancel simply because you want to — you must have been below the threshold continuously for four quarters first. If you are just experiencing a slow period but expect revenue to recover, it may not make sense to cancel and then re-register again later. The CRA processes cancellation requests and confirms the effective cancellation date in writing.