If your small business revenue has dropped below the GST/HST registration threshold, or you're planning to wind down operations, you may wonder whether you can deregister. The answer depends on your current sales level and whether you meet CRA eligibility rules. In most cases, if your revenue falls below $30,000 over four consecutive quarters, this CRA rule may apply to you for voluntary deregistration. However, deregistration isn't automatic, and there are important tax and cash flow consequences to understand before making the move. Not every business owner who wants to deregister can do so immediately. The CRA has specific rules about when deregistration is allowed. You may be eligible to deregister if: - Your revenue has fallen below $30,000 over four consecutive calendar quarters - You're winding down your business and expect sales to remain below $30,000 - You're discontinuing commercial activities entirely - You meet the Small Suppliers Exemption criteria (revenue under $30,000 annually, though this rule may apply to you if you elected to register voluntarily) If you're a large business that voluntarily registered for GST/HST even though you weren't required to, you still need CRA approval to deregister.
You may be eligible to deregister if your revenue has fallen below $30,000 over four consecutive calendar quarters and you meet CRA eligibility criteria. However, you cannot simply cancel registration yourself; you must request approval from the CRA, which will review your situation and confirm the deregistration date.
When you deregister, the CRA may consider your inventory as a deemed supply, meaning you could owe GST/HST on the fair market value of unsold goods. This tax liability must be calculated and included in your final GST/HST return before deregistration is approved.
Yes. Once deregistered, you can no longer claim input tax credits on business expenses, even if you pay GST/HST on supplies or equipment. This is one of the biggest cash flow impacts of deregistration, especially for businesses with significant ongoing expenses.
Yes. Before the CRA approves deregistration, you must file a final return covering the period up to your deregistration date. This return accounts for all tax owing or refunds due and ensures all outstanding obligations are settled.
Yes. If your revenue exceeds $30,000 over four consecutive quarters after deregistering, you may be required to re-register. You can also request re-registration voluntarily at any time if you believe it benefits your business.