Sales Tax Recovery Services
Here's How Sales Tax Recovery Works with TRS
This information explains the steps in a sales tax audit provided by TRS Tax Recovery Services Inc. The taxes audited include the Goods and Services Tax (GST), Harmonized Sales Tax (HST), Quebec Sales Tax (QST), Manitoba Retail Sales Tax (RST), Saskatchewan Provincial Sales Tax (PST), British Columbia Provincial Sales Tax (PST).
A PRE-AUDIT of the accounts payable transactions and general ledger electronic data is completed by Jerry Pencak, at the TRS office. The data fields prescribed by TRS are used by you to download accounts payable transactions to MS Excel and send to TRS using WeTransfer. The number of rows of data is dependent on the size of your company. A separate worksheet is required for each year. Based on the size of your company, the number of rows of data could range from 1,000 to 1 million. TRS will analyze the data using numerous features in Excel
A FIELD AUDIT of suppliers’ invoices, manual journal entries, monthly sales tax returns and other relevant information is completed at your office.
Upon completion of the audit, TRS will review the savings and exposure with you. All savings are verified by you while TRS is on-site.
TRS will also make recommendations for improving procedures in processing sales tax on accounts payable transactions.
TRS will complete its report and Excel worksheets within (7) days from completion of the FIELD AUDIT.
Hard and soft copies of suppliers’ invoices and other supporting documents will be provided with the TRS report.
Sales Tax in Different Provinces
TRS Tax Recovery Services Inc. specializes in tax recovery services throughout Canada. Each province has slightly different rules and regulations, and that is where Jerry’s expertise comes in.
In the provinces of Manitoba, Saskatchewan and British Columbia, a tour of facilities is completed to develop an understanding of the operations and sales tax issues. The determination of taxable and exempt goods and services is made using the Acts, Regulations and sales tax bulletins of each province. Tax savings will result where PST is paid to a vendor, in error, for goods used for exempt purposes.
The provinces of Ontario, Nova Scotia, New Brunswick, Newfoundland and Labrador are harmonized which means that the previous GST rate and previous PST rate are combined into one or a harmonized rate. GST/HST is refundable which means that the tax paid by a registrant company to a supplier for goods and services used more that 50% in its commercial activities is refunded by the government upon filing monthly, quarterly or annual GST/HST returns. In these provinces, the TRS audit is primarily focused on the accounts payable cycle and identifying suppliers’ invoices where GST/HST input tax credits (ITCs) were not recorded, or recorded incorrectly, in the general ledger.
In the province of Quebec, the Quebec Sales Tax (QST) works the same way as GST/HST which means that the QST is also refundable upon filing monthly, quarterly or annual combined GST/HST and QST returns. In Quebec, the TRS audit is primarily focused on the accounts payable cycle and identifying suppliers’ invoices where GST input tax credits (ITCs) and QST input tax refunds (ITRs) were not recorded, or recorded incorrectly, in the general ledger. GST/HST and QST publications are provided by the federal and provincial governments to assist clients comply with the rules and legislation.
| 8-1 | General Eligibility Rules |
| 8-2 | General Restrictions and Limitations |
| 8-3 | Calculating Input Tax Credits |
| 8-4 | Documentary Requirements for Claiming Input Tax Credits |
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Please contact me for more information. TRS may be the best fit for your needs!
