- Under the Excise Tax Act, a business that stays below a revenue threshold is treated as a "small supplier" and generally does not have to register for, charge, or collect HST.
- The test looks at worldwide revenue from taxable supplies — not just profit, and not just Ontario sales.
- - Revenue from supplies that are exempt from GST/HST altogether (such as most basic financial services) is generally excluded from the small-supplier calculation, since it isn't revenue…
Every Ontario business owner runs into the same question sooner or later: do I need to register for HST? The answer usually comes down to the small supplier threshold — a revenue test set out in the federal Excise Tax Act. Getting the calculation right matters, because registering late can mean owing HST you never collected from your customers.
This article explains, in general terms, how the small-supplier calculation works: what counts as revenue, what doesn't, and over what period CRA measures it. Because the exact dollar threshold is periodically reviewed and can be described differently depending on the source, always confirm the current figure directly with CRA before relying on it.
What "Small Supplier" Means
Under the Excise Tax Act, a business that stays below a revenue threshold is treated as a "small supplier" and generally does not have to register for, charge, or collect HST. Once a business's revenue from taxable supplies crosses that threshold, it generally must register and start charging HST on its taxable sales, whether or not it has gotten around to registering yet.
What Counts as Revenue for the Calculation
The test looks at worldwide revenue from taxable supplies — not just profit, and not just Ontario sales. In general terms, this includes:
- Revenue from goods and services you sell that are taxable (including zero-rated supplies, which are taxed at a 0% rate but still count toward the threshold calculation)
- Revenue earned by associated businesses you control or that are under common control, which generally must be combined with your own for this test
- Revenue from all your commercial activities combined, if you operate more than one business as a sole proprietor
What Generally Doesn't Count
- Revenue from supplies that are exempt from GST/HST altogether (such as most basic financial services) is generally excluded from the small-supplier calculation, since it isn't revenue from a "taxable supply" in the first place.
- Proceeds from selling capital property (like used equipment) are generally treated differently from ordinary sales revenue for this purpose.
- Personal, non-business income has no place in a business revenue calculation at all.
Because these carve-outs have real nuance, a business close to the line should have an accountant confirm exactly which revenue streams are included before concluding it's still under the threshold.
The Look-Back Period
CRA measures the threshold using a rolling calculation, generally looking at revenue over recent consecutive calendar quarters rather than a single fixed calendar year. In practice, this means a business can cross the threshold partway through a year — not only at year-end — and the obligation to register can be triggered at that point, not just when preparing annual accounts. Because the exact mechanics of the look-back window matter and can be described in more than one way, confirm the current rule with CRA or an accountant rather than assuming a fixed calendar year is what's being measured.
What Happens the Moment You Cross the Threshold
Once your revenue crosses the small-supplier line, you generally need to register for an HST number and begin charging HST — currently 13% in Ontario (5% federal plus 8% provincial), as of mid-2026 — on your taxable sales going forward. Waiting to "see how the year goes" before registering can leave a business on the hook for HST it should have charged customers but didn't, which is a cost the business itself typically ends up absorbing.
Registering Once You're No Longer a Small Supplier
- [ ] Track your worldwide taxable-supply revenue on a rolling basis, not just at year-end.
- [ ] Include revenue from associated businesses under common control.
- [ ] Register for an HST number promptly once you determine you've crossed the threshold — don't wait for a specific calendar milestone.
- [ ] Start charging and remitting HST on taxable sales from the point registration is required.
- [ ] Talk to an accountant if your revenue is close to the line, since the calculation has more nuance than a single number suggests.
Frequently asked questions
Does GST/HST I collect count toward my own revenue for this calculation?
No. The tax itself isn't your revenue — the calculation looks at the value of the goods or services you sold, not the tax collected on top of it.
If I run two small side businesses, do I add their revenue together?
Generally yes, if you're the same individual or the businesses are associated — CRA looks at your combined commercial activity, not each business in isolation. Structuring multiple businesses to each stay "under the threshold" separately doesn't generally work if they're really the same person's activity.
What if I go over the threshold for one quarter and then drop back below it?
The rules around temporarily crossing the threshold and later falling back below it have specific mechanics that aren't a simple on/off switch. This is exactly the kind of borderline situation where it's worth confirming your registration status with CRA or an accountant rather than guessing.
Can I register for HST voluntarily even if I'm still under the threshold?
Yes — voluntary registration is available to many small suppliers who haven't yet crossed the threshold. There are trade-offs either way, covered in more detail in a companion article on voluntary HST registration.
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