Closing a GST/HST Account: The Clean Exit

Should You Close It at All?

Three situations account for most legitimate closures:

• Your revenues have settled under the threshold. If your worldwide taxable revenues have stayed consistently below the $30,000 small-supplier threshold and you see no growth coming, staying registered means filing returns, remitting on schedule, and tracking ITCs for a tax you barely collect. Deregistering trades a small ITC benefit for a lot less administration.
• You're closing the business. Winding down entirely — retiring, going back to employment with no side income — means the account should close with the business rather than sit dormant accumulating missed-return penalties. Nil returns are still mandatory returns while the account is open.
• You're incorporating. The GST/HST account belongs to the legal entity, not the activity. When a sole proprietor incorporates, the sole proprietorship's RT account is closed and the corporation registers for its own — the number does not transfer. The broader trade-offs of that move are covered in our sole proprietorship vs incorporation guide.

One rule catches voluntary registrants off guard: if you registered before you were required to — a common move to claim ITCs or look established to clients — you generally must stay registered for at least one year before the CRA will cancel the account. And before closing at all, weigh what you give up: no more ITCs on your software, equipment, and accountant's fees, and some corporate clients read a GST/HST number as a signal of an established business.

How to Close the Account

Cancellation goes through Form RC145 (Request to Close Business Number Program Accounts) or, faster, through CRA My Business Account. You specify which program account to close — the RT (GST/HST) account can close while your payroll or import/export accounts stay open — and the effective date of cancellation.

The effective date matters more than it looks. It sets the end of your final reporting period, the date you must stop charging tax, and the valuation date for the deemed-disposition rules below. Generally the cancellation takes effect no earlier than the day you ask for (or the day you ceased commercial activity); pick a clean cut-off — the end of a month or quarter — and align your last invoices to it.

The Catch Most People Miss: Repaying ITCs on What You Still Own

Deregistration is not free if you claimed ITCs on assets you still hold. When your registration is cancelled, you are generally treated as having disposed of capital property still in business use at fair market value immediately before closure — and you may have to self-assess GST/HST on that value and include it on your final return. In plain terms: the laptop, camera gear, or work vehicle you recovered tax on when you bought it doesn't get to exit the system tax-free just because you do.

The mechanics vary by property type and value, and small-value assets may produce little or nothing owing — but a recently purchased vehicle or equipment package can produce a real balance. Have an accountant review your asset list before you choose a closure date. Sometimes the answer is simply to time the closure differently; sometimes it changes the decision entirely.

The Final Return

Closing the account does not skip the last filing. Your final return covers the period from the start of your current reporting period to the cancellation date, and it must include:

• GST/HST collected on every invoice up to the closure date
• Any self-assessed tax from the deemed disposition of capital property
• Your remaining eligible ITCs for the period
• The net balance, remitted by the return's due date

The filing mechanics are the same as any other period — see our GST/HST remittance guide for the line-by-line. And the records behind every return you ever filed must survive the account: the CRA's retention period is generally six years, and deregistering does not shorten it. Our record-keeping guide covers what to keep and in what form.

After the Account Closes

• Stop charging GST/HST immediately. From the effective date, your invoices show no tax. Charging tax while unregistered is a real problem — amounts collected as tax are owed to the CRA regardless, and your clients' ITC claims rest on a registration number that no longer exists.
• Update your invoice templates the same day. Remove the tax line and the GST/HST registration number from your invoice footer. Leaving a defunct RT number on invoices invites exactly the confusion you deregistered to avoid.
• Tell recurring clients. Anyone you bill monthly will notice the total dropped — a one-line note ("no longer GST/HST registered as of [date]") prevents accounts-payable queries.
• Keep watching the threshold. Deregistering doesn't exempt you from the rules. If your taxable revenues climb back over $30,000 across four rolling quarters, registration becomes mandatory again — our registration guide walks through the timing. Re-registering is straightforward; missing the moment you were required to is not.

One Housekeeping Step in Your Invoicing Tool

Whatever you invoice with, the tax settings need to change the day the closure takes effect. In InvoiceFast, tax collection is a per-invoice, per-profile setting — toggle GST/HST off and your invoices immediately render clean subtotal-only totals, with your saved clients and numbering untouched. If you later re-register, toggle it back on and the correct provincial rate applies automatically. Either way, your historical invoices keep their tax lines intact, which is exactly what the six-year record rule wants.

Frequently Asked Questions

When can I close my GST/HST account?

When your taxable revenues sit consistently under $30,000 and you choose to deregister, when the business has ceased, or when you incorporate and the sole proprietorship's account closes in favour of the corporation's new one.

Can I close my account if I registered voluntarily last month?

Generally no. Voluntary registrants must usually stay registered for at least one year before the CRA will cancel the account. Plan for four-plus filings before the exit.

What happens to ITCs I claimed on equipment I still own?

You may have to repay them. Deregistration generally triggers a deemed disposition of business capital property at fair market value, with self-assessed tax on the final return. Review your asset list with an accountant before picking a closure date.

Do I file a final return?

Yes — covering the period up to the cancellation date, including tax collected, any self-assessed amounts, and remaining ITCs, with the balance remitted by the due date. Records stay kept for roughly six years after.

Can I charge GST/HST while my closure request is processing?

You charge tax up to the effective cancellation date and not a day past it. From that date, invoices go out without tax and without the registration number.