We find sales taxes fascinating. Your year-end accountant spends 98% of their time dealing with income tax issues. Most make sure that your GST and PST reported makes sense when compared to your sales reported for income tax.
Overpaid sales taxes can be claimed back. You just have to claim them.
As easy as it is for a CRA auditor to come in and pick instances of under-remitted GST collected, it is just as easy to comb in the other direction and find where the business under claimed an ITC, or didn’t claim a PST exemption that was available to them.
Using the same software the CRA auditors use, we can comb in the other direction, finding instances of under claimed input tax credits and PST overpaid. Unlike income rules, where expense must be matched to revenues, most businesses have FOUR YEARS to claim input tax credits.
An under claimed input tax credit is like a ticket you can redeem for cash. So much attention is focused on getting income tax filings right, that sales tax systems rarely get looked at to see if they are squeezing out every ITC.
The software we use dredges up transactions where the input tax credit didn’t get claimed properly.
Even if you have the best bookkeepers, there are many reasons input tax credits gets missed:
Just looking for these things usually finds other instances where sales tax have been overpaid.
CFO’s love us because we can squeeze a sponge that produces cash and improves the financial position. Controllers dislike us because we point out inefficiencies in the accounting system. We make sure to explain our findings in a way that the accounting team can learn from.
We charge a percentage of what we find. If we find nothing, your cost is zero.