The HST Quick Method is a CRA-approved simplified accounting option that allows eligible small businesses to remit HST using a flat remittance rate rather than tracking every purchase and input tax credit individually. For service-based businesses with low expenses, it can result in significant savings.
How the Quick Method Works
Under the regular HST method, you collect 13% HST on sales, claim input tax credits (ITCs) on business purchases, and remit the net difference to the CRA.
Under the Quick Method, you collect 13% HST as normal, but remit only a fixed percentage of your gross sales including HST. The difference between what you collected and what you remit is yours to keep — it compensates for the ITCs you give up.
- Service businesses (no permanent establishment): remit 8.8% of HST-included sales
- Businesses that sell goods (retail/wholesale): remit 1.8% of HST-included sales
- You keep a 1% credit on the first $30,000 of annual HST-included sales
Example: You invoice $10,000 + 13% HST = $11,300 total. Under Quick Method, you remit 8.8% × $11,300 = $994.40, keeping $475.60 of the HST collected instead of tracking ITCs.
Who Can Use the Quick Method
Not all businesses are eligible. To use the Quick Method, you must have annual HST-included worldwide taxable supplies of $400,000 or less in the preceding fiscal year.
- Annual revenues must be under $400,000 (HST included)
- Cannot be used by accountants, bookkeepers, financial consultants, or lawyers
- Cannot be used by charities or financial institutions
- Must have been registered for HST for at least one year before electing
Note: Certain professional services are excluded from Quick Method eligibility. This includes accounting and bookkeeping firms — which is why we always recommend this to clients but cannot use it ourselves.
Quick Method vs Regular Method: When Does It Save You Money?
The Quick Method is most advantageous for service businesses with low input costs — consultants, freelancers, coaches, IT professionals. It is less beneficial for businesses with significant HST-taxable purchases.
The break-even point is roughly when your HST-eligible expenses equal about 45% of your revenue. If your expenses are lower than that, Quick Method likely saves money.
- Benefits most: consultants, designers, coaches, IT services, healthcare
- Less beneficial: retailers, manufacturers, contractors with high material costs
- Run the numbers: compare ITCs you would claim vs Quick Method savings
Tip: Have your CPA run a comparison using your actual prior year numbers before electing. The savings can be $500–$3,000+ annually for a typical Ontario service business.
How to Elect the Quick Method
You must file an election with the CRA before the due date of your first HST return for the fiscal year you want it to apply. You can file the election online through My Business Account using form GST74.
- File form GST74 (Election and Revocation of the Quick Method)
- Election applies from the beginning of the reporting period you elect
- You can revoke the election, but there is a minimum one-year waiting period to re-elect
Key Takeaways
The HST Quick Method is one of the most underused tax simplification tools available to Ontario small business owners. For service businesses especially, it reduces bookkeeping complexity and often results in meaningful tax savings. Run the numbers with a CPA before your next HST filing.
Not Sure If Quick Method Is Right for You?
We can run the numbers and file the election for you. Get a free consultation to find out how much you could save.
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