GST/HST Calculator for Ontario: How to Calculate 13% HST Correctly

Ontario's Harmonized Sales Tax (HST) combines the federal GST with the provincial PST into one streamlined tax. At 13%, it touches nearly every purchase and sale in the province. Whether you're a consumer, business owner, or entrepreneur, you need to know how it works.

What is the Ontario HST? Ontario's HST (Harmonized Sales Tax) is a 13% blended sales tax consisting of a 5% federal portion (GST) and an 8% provincial portion (PST). Administered by the Canada Revenue Agency (CRA), it replaced the separate GST and PST systems on July 1, 2010, simplifying tax compliance for businesses and providing a single transparent rate for consumers.

Our GST/HST Calculator for Ontario makes adding or removing HST simple — with a full GST and PST breakdown so your numbers are always right.

Key Takeaways

• Ontario's HST is 13% — 5% federal GST + 8% provincial PST, administered together by the CRA
• To add HST: multiply the pre-tax amount by 1.13; to remove HST: divide the total by 1.13
• Registered businesses can claim Input Tax Credits (ITCs) to recover HST paid on business expenses
• Zero-rated supplies (groceries, exports) have 0% HST but businesses can still claim ITCs
• Exempt supplies (child care, residential rent, health care) have no HST and businesses cannot claim ITCs
• You must register for HST if your taxable revenue exceeds $30,000 in any single quarter

Understanding Ontario's HST Rate

Ontario's 13% HST is a blended tax:

• Federal portion (GST): 5%
• Provincial portion (PST): 8%
• Total HST: 13%

The HST launched on July 1, 2010, replacing the separate 5% GST and 8% PST. The CRA handles it on behalf of the province, making life easier for businesses operating across multiple provinces.

How the HST Rate Compares Across Canada

How to Add HST to a Pre-Tax Amount

Got a price before tax? Here's the formula:

Total with HST = Pre-tax Amount × 1.13 GST Portion = Pre-tax Amount × 0.05 PST Portion = Pre-tax Amount × 0.08 Total HST = Pre-tax Amount × 0.13

Example: Adding HST

A service costs $1,000 before tax:

• GST (5%): $1,000 × 0.05 = $50
• PST (8%): $1,000 × 0.08 = $80
• Total HST (13%): $1,000 × 0.13 = $130
• Total with HST: $1,000 × 1.13 = $1,130

Quick Reference: Adding HST

How to Remove HST from a Total

Need to work backward from a price that already includes HST?

Pre-tax Amount = Total including HST / 1.13 HST Amount = Total - Pre-tax Amount GST = Pre-tax Amount × 0.05 PST = Pre-tax Amount × 0.08

Example: Removing HST

An item costs $1,130 including HST:

• Pre-tax Amount: $1,130 / 1.13 = $1,000
• Total HST: $1,130 - $1,000 = $130
• GST: $1,000 × 0.05 = $50
• PST: $1,000 × 0.08 = $80

This comes in handy for expense tracking, ITC calculations, and figuring out the true cost of purchases.

Quick Reference: Removing HST

GST vs. PST vs. HST: What Is the Difference?

Before HST, Ontario businesses dealt with two separate taxes:

• GST (Goods and Services Tax): A 5% federal tax on most goods and services. Businesses could claim ITCs to recover GST paid on expenses.
• PST (Provincial Sales Tax): An 8% provincial tax applied at retail. Unlike GST, businesses generally couldn't recover PST paid on inputs — so it was baked into their costs.

Advantages of the HST System

1. 1. Simplified compliance: One tax return instead of two
2. 2. Lower business costs: Claim ITCs for the full 13%
3. 3. Transparency for consumers: A single rate makes pricing clearer
4. 4. Economic efficiency: No more cascading tax under the old PST system

HST Exemptions in Ontario

Not everything gets HST slapped on it. Knowing what's exempt saves you from overcharging — or under-collecting.

Exempt Supplies (No HST Charged)

If you sell only exempt supplies, you usually don't need to register for or collect HST:

• Basic groceries: Meat, veggies, dairy, eggs, cereal, bread (not restaurant meals or prepared foods)
• Child care services: Licensed daycare and nursery schools
• Prescription drugs: Medications prescribed by a doctor
• Medical devices: Hearing aids, artificial teeth, wheelchairs, prescription glasses
• Educational services: Tuition for diploma, degree, or certificate programs
• Residential rent: Long-term rentals (more than one month)
• Financial services: Most banking, insurance, and investment services
• Health care services: Doctors, dentists, and licensed health professionals
• Legal aid services: Certain legal services provided under legal aid plans

How Exempt Supplies Affect Your Business

If you sell both taxable and exempt supplies, you can only claim ITCs for HST paid on expenses tied to your taxable supplies. That's partial ITC entitlement. You must track which expenses relate to which type of supply and calculate the percentage of ITCs you can claim accordingly.

Input Tax Credits for Businesses

Input Tax Credits (ITCs) let registered businesses recover the HST they pay on business expenses. You effectively pay HST only on the value you add, not your total revenue.

What Expenses Qualify for ITCs?

• Inventory and raw materials for resale or manufacturing
• Equipment, machinery, and tools
• Business premises rent
• Utilities (electricity, gas, internet)
• Professional services (legal, accounting, consulting)
• Advertising and marketing
• Office supplies and software
• Vehicle expenses used for business (partial)

What Does NOT Qualify?

• Personal or non-business expenses
• Meals and entertainment (50% recovery)
• Club memberships
• Property acquired for personal use
• Expenses related to exempt supplies

How to Claim ITCs

1. 1. Register for HST/GST
2. 2. Keep every receipt and invoice showing HST paid
3. 3. Report ITCs on your HST return (Form GST34)
4. 4. File quarterly, annually, or monthly based on your revenue

Zero-Rated vs. Exempt Supplies

Don't confuse these two:

Zero-rated supplies are taxable at 0%. You still register, still claim ITCs, but don't charge HST to customers. Great for exporters and basic goods producers. Exempt supplies have no HST at all. Sell only these? You don't register and can't claim ITCs.

Business Registration for HST

Do You Need to Register?

You must register for a GST/HST account if:

• Your total taxable revenue (including zero-rated) exceeds $30,000 in any single calendar quarter or over four consecutive quarters
• You sell taxable supplies (including zero-rated) in Canada

Voluntary Registration

Below $30,000? You can still voluntarily register to claim ITCs. Worth it for:

• Startups with big upfront expenses
• Exporters who want to recover HST on inputs
• Businesses selling mainly to other registered businesses

How to Register

1. 1. Go to the CRA's Business Registration Online (BRO) portal
2. 2. Provide your business info and business number
3. 3. Pick your reporting period (annual, quarterly, or monthly)
4. 4. Choose your filing method (online or paper)

Practical Examples

Example 1: Small Business Pricing

A web design agency charges $2,000 for a website. As a registered business, they add HST:

• Pre-tax: $2,000
• GST (5%): $100
• PST (8%): $160
• Total HST (13%): $260
• Invoice Total: $2,260

The agency can claim ITCs on software subscriptions, equipment, and other expenses.

Example 2: Consumer Purchase

A consumer buys furniture for $1,500 plus HST:

• Pre-tax: $1,500
• HST (13%): $195
• Total Paid: $1,695

No registration means no ITC recovery.

Example 3: Removing HST for Expense Tracking

A business owner paid $565 including HST for office supplies:

• Pre-tax: $565 / 1.13 = $500
• HST embedded: $65
• ITC claimable: $65

The true expense? $500.

Example 4: Exporter Advantage

A software company exports $100,000 worth of services to the US. Zero-rated means:

• No HST charged to the US customer
• Company claims ITCs on all expenses
• Paid $13,000 HST on expenses? They get it all back

Example 5: ITC Calculation for a Contractor

A contractor earns $80,000 in taxable revenue and pays $5,000 in HST on expenses:

• HST collected from clients: $80,000 × 13% = $10,400
• ITCs claimed: $5,000
• Net HST remitted to CRA: $10,400 - $5,000 = $5,400

Without ITCs, the contractor would remit the full $10,400. Proper ITC claiming saves them $5,000.

Example 6: Restaurant Business

A restaurant in Toronto has $200,000 in annual taxable sales. They pay $15,000 in HST on food supplies, equipment, and utilities.

• HST collected from customers: $200,000 × 13% = $26,000
• ITCs claimed: $15,000
• Net HST remitted: $26,000 - $15,000 = $11,000

If the restaurant failed to claim ITCs on all eligible expenses, they would overpay by thousands of dollars.

HST for E-Commerce and Online Businesses

Online businesses selling to Ontario customers face specific HST obligations. If you sell digital products, software, or services to Ontario residents, you must charge 13% HST regardless of where your business is physically located, under the CRA's place-of-supply rules for intangible property.

Digital products subject to Ontario HST:

• Software downloads and SaaS subscriptions
• E-books, online courses, and digital content
• Streaming services (video, music, gaming)
• Online consulting and coaching services delivered virtually
• Websites, domain names, and digital advertising

Key rules for e-commerce:

• If your total worldwide taxable revenue exceeds $30,000 in a quarter, you must register for HST
• The place of supply for digital services is the customer's usual residence
• You need to collect and remit HST based on the customer's province
• Simplified registration is available for non-resident businesses

Quick Reference: HST Rates for Common Purchases

Understanding which HST rate applies to common business and consumer purchases helps avoid costly mistakes:

CRA Audits and Compliance

The CRA actively audits HST returns to ensure compliance. Common audit triggers include:

• Large or frequent ITC claims compared to industry norms
• Consistently reporting refunds (input credits exceed output tax)
• Significant fluctuations in reported revenue or ITCs
• Late or missing filings
• Industry-specific targeting (construction, restaurants, and professional services are frequently audited)

If selected for audit, the CRA will request up to 6 years of records. Having organized digital records of all receipts, invoices, and HST returns streamlines the audit process. Penalties for non-compliance can include reassessment of tax owing plus interest, penalties of up to 25% of the amount, and in severe cases, prosecution.

HST Filing and Payment

Filing Frequency

Filing Deadlines

• Annual filers: Due 3 months after the end of the fiscal year
• Quarterly filers: Due 1 month after the end of the quarter
• Monthly filers: Due 1 month after the end of the month

Late filings incur penalties: 1% of the balance due plus 25% of the amount if more than once in 3 years. Interest compounds daily at the prescribed rate.

Common Mistakes

Charging HST on exempt supplies. If you provide child care or residential rent, don't add HST. Charging tax on exempt supplies confuses customers and creates unnecessary paperwork. Missing ITC claims. Many small businesses fail to claim ITCs on legitimate expenses like vehicle costs, home office expenses, and professional development. Every dollar of missed ITCs is a dollar of overpaid tax. Filing deadlines. HST returns have strict deadlines based on your reporting period. Late filing triggers penalties and interest. Set calendar reminders and file on time. Not collecting HST when required. If you exceed $30,000 in a quarter, you must register and start collecting HST immediately — not at the end of the year. Mixing personal and business expenses. Using personal accounts for business transactions makes ITC tracking nearly impossible. Keep separate bank accounts and credit cards for your business. Incorrectly classifying supplies. Misclassifying a taxable supply as exempt (or vice versa) can lead to reassessments, penalties, and interest. When in doubt, consult the CRA's GST/HST Memoranda series or a tax professional.

Best Practices for HST Management

Keep digital records. Save all receipts and invoices in a digital format. The CRA requires you to keep records for 6 years. Cloud-based accounting tools make ITC tracking automatic. Separate business and personal expenses. Use dedicated business accounts and credit cards. Mixed expenses complicate ITC calculations and increase audit risk. File on time every time. Late penalties are 1% of the balance due plus 25% of the amount if more than once in 3 years. Interest compounds daily. Review your filing frequency annually. As your revenue grows, your ideal filing frequency may change. Annual filers with growing revenue may benefit from monthly filing to improve cash flow on ITC refunds. Work with a professional. HST rules are complex. A chartered professional accountant (CPA) can help with registration, ITC optimization, and compliance to ensure you never overpay or under-collect.

Conclusion

Whether you're calculating a final price, preparing invoices, claiming ITCs, or staying compliant, knowing how to add and remove HST is crucial. Our GST/HST Calculator for Ontario gives you instant, accurate results with a full GST and PST breakdown.

Also explore our Tax Calculator for income tax estimates, Salary Calculator for payroll deductions, Percentage Calculator for quick percentages, and our Canada Child Benefit Calculator for family tax credits. Calculate your HST accurately every time.

FAQs

What is the Ontario HST rate?

13%, made up of 5% federal GST and 8% provincial PST. Administered by the CRA.

How do you calculate HST from a pre-tax amount?

Multiply by 13% (0.13). $100 × 0.13 = $13 HST, total $113. GST is $5, PST is $8.

How do you remove HST from a total?

Divide by 1.13. $113 / 1.13 = $100 pre-tax, HST is $13.

What items are exempt from HST in Ontario?

Basic groceries, child care, prescription drugs, medical devices, education, residential rent, health care, and most financial services.

Do businesses charge HST on everything?

No. Some items are zero-rated (0% tax, but ITCs claimable) like groceries and exports. Others are fully exempt like child care and residential rent.

Can businesses claim Input Tax Credits for HST?

Yes. Registered businesses claim ITCs to recover HST on expenses, paying tax only on the value they add.

Is the HST rate the same across all Canadian provinces?

No. Ontario is 13%, Quebec is 14.975%, Alberta is 5% (no PST), BC is 12%, Nova Scotia is 15%.

When do I need to register for HST in Ontario?

When your taxable revenue exceeds $30,000 in a single quarter or over four consecutive quarters. Voluntary registration is also an option.

What is the difference between zero-rated and exempt supplies?

Zero-rated supplies (groceries, exports) are taxed at 0% and businesses can claim ITCs. Exempt supplies (child care, rent) have no HST and businesses cannot claim ITCs.

How long do I need to keep HST records?

The CRA requires you to keep all receipts, invoices, and accounting records for 6 years from the end of the last tax year they relate to. Digital copies are acceptable.