GST & Tax · Edmonton
How to calculate your GST return, line by line.
GST collected, minus the GST you can claim back, equals what you owe. Here's how to get each number right, with a full worked example and the mistakes that cost Alberta businesses money.
By the Plum team- Updated Oct 2026
- 9 min read
- Net tax = GST you collected minus the input tax credits (ITCs) you can claim.
- GST counts when you invoice, not just when you get paid.
- Some costs carry no GST to claim: insurance, bank fees, payroll and residential rent.
- Meals and entertainment: claim only 50% of the GST.
- Reconcile your GST account in the books before you file, every time.
Filing a GST return looks scary because of the form, but the maths underneath is simple. This guide shows you how to calculate your GST return from scratch: what goes in, what stays out, and how the numbers land on CRA's GST34 lines. We'll finish with a full worked example for a hypothetical Alberta business so you can follow every dollar.
Alberta has no PST, so if you're in Edmonton, Sherwood Park or St. Albert and only sell in Alberta, you're dealing with one tax at 5%. That makes this about as clean as GST gets in Canada.
1The one formula behind every GST return
Every return, monthly, quarterly or annual, comes down to this:
GST collected is the 5% you charged customers on taxable sales during the period. Input tax credits are the GST you paid on purchases used in your business, which CRA lets you claim back. If net tax is positive you pay it. If it's negative you get a refund.
Your bookkeeping software does most of this automatically, but only if each transaction was coded correctly when it was entered. That's why the real work of a GST return happens all period long, not on the day you file.
2Step 1: Add up the GST you collected
Start with your sales for the period. For each taxable sale you should have charged 5%. A few rules decide which period a sale belongs to and whether it counts at all:
- Timing follows the invoice. GST generally becomes payable on the earlier of when the customer pays or when the invoice is issued or due. An invoice dated December 20 and paid January 10 normally goes on the return that covers December.
- Deposits count when received. If a customer pays a deposit before you invoice, GST on that deposit is generally due in the period you receive it.
- Exempt sales carry no GST. Many health services, residential rents and most financial services are exempt. They don't belong in GST collected.
- Zero-rated sales carry GST at 0%. Most exports and basic groceries fall here. No GST is collected, but you can still claim ITCs on the related costs.
- Credit notes reduce it. If you refunded a customer, including the GST, your GST collected goes down by the GST you gave back.
If you only have GST-included totals (common with point-of-sale apps), back the GST out with the 5/105 rule: multiply the total by 5 and divide by 105. A $1,050 day of sales contains $50 of GST and $1,000 of revenue. Never take 5% of the total; that overstates your tax.
3Step 2: Add up your input tax credits
Go through the period's business purchases and total the GST you paid on anything used in your taxable business. Our full guide to input tax credits covers the rules in depth, but here's the working version:
| Expense | GST to claim? | Why |
|---|---|---|
| Rent on commercial space | Yes, full | Commercial rent is taxable |
| Software, phone, supplies | Yes, business share | Apportion any personal use |
| Equipment and computers | Yes | Claimed when bought, even though CCA spreads the cost for income tax |
| Client meals and entertainment | 50% | Same restriction as for income tax |
| Vehicle costs | Business-use share | Based on your mileage log |
| Business insurance | No | Insurance is exempt, no GST charged |
| Bank and loan interest, most bank fees | No | Financial services are exempt |
| Wages and payroll | No | Not a taxable supply |
| Purchases from unregistered suppliers | No | No GST was charged |
You need a receipt or invoice that supports each claim, and once a purchase passes $100 it has to show the supplier's GST number. Hold on to those documents for six years.
4A worked GST return example
Say you're a sole proprietor interior designer in Sherwood Park. You're an annual filer with a December 31 year end, and all your clients are in Alberta. Here's your year:
| Item | Amount before GST | GST |
|---|---|---|
| Design fees invoiced | $96,000 | $4,800 |
| Furniture resold to clients | $14,000 | $700 |
| GST collected | $110,000 | $5,500 |
| Furniture bought for resale | $10,000 | $500 claimed |
| Studio rent | $18,000 | $900 claimed |
| Software and subscriptions | $2,400 | $120 claimed |
| Phone and internet (business share) | $1,200 | $60 claimed |
| Client meals | $1,600 | $80 paid, $40 claimed (50%) |
| Vehicle costs, 60% business use | $4,000 | $200 paid, $120 claimed |
| New laptop | $2,500 | $125 claimed |
| Insurance and bank fees | $1,800 | $0 (exempt) |
| Total ITCs | $1,865 |
Net tax is $5,500 minus $1,865, which is $3,635. Because you're a sole proprietor with a calendar year end, you file by June 15 but pay by April 30. And because net tax was over $3,000, CRA will generally expect quarterly GST instalments next year. Our guide to GST filing deadlines in Alberta explains those dates.
How it lands on the GST34 form
- Line 101, sales and other revenue: $110,000 (no GST included).
- Line 103, GST collected: $5,500.
- Line 106, input tax credits: $1,865.
- Line 109, net tax: $3,635.
- Line 110, instalments already paid: $0 in this example.
There are other lines for adjustments, rebates and special situations. Most small businesses leave them at zero, but read CRA's line instructions if you've had bad debts, sold a building or received a rebate.
The journal entry when you pay
If your books track GST collected and ITCs in separate accounts, the payment clears both and the bank pays the difference:
| Account | Debit | Credit |
|---|---|---|
| GST collected (liability) | $5,500.00 | |
| Input tax credits (asset) | $1,865.00 | |
| Bank | $3,635.00 | |
| Total | $5,500.00 | $5,500.00 |
After this entry both GST accounts are back to zero for the year. If they aren't, something was coded to the wrong period or the wrong tax code, and you want to find it before CRA does.
5How your GST return works in QuickBooks Online
In QuickBooks Online Canada, GST lives under the Taxes menu. Once you've set up CRA as your tax agency with the right filing frequency, QuickBooks tracks the GST on every invoice and expense that has a tax code applied. At period end you choose the return, QuickBooks fills in the lines from your coded transactions, and after you file with CRA you record the payment so the liability clears.
The software is only as good as the coding. Before trusting the numbers, check three things:
6Common GST return mistakes
Taking 5% of bank deposits. Deposits include GST, loans, transfers and refunds. Working from deposits instead of sales overstates what you owe, sometimes by a lot.
Claiming GST that was never charged. Insurance, bank fees, most processing fees and purchases from unregistered suppliers have no GST in them. Claiming 5% on them is an error CRA spots quickly in a review.
Claiming 100% on meals. Meals and entertainment are limited to 50%, for GST as well as income tax.
Reporting on a cash basis by accident. GST follows invoices. If you only report GST when customers pay, unpaid invoices at year end slip into the wrong return.
Putting GST in line 101. Line 101 is revenue before tax. Including GST inflates your sales figure.
Filing without reconciling. A return built on unreconciled books is a guess. Reconcile first, then file.
Rules and form lines can change, so confirm anything unusual with CRA or your accountant. If you'd like a second set of eyes on your return, or someone to prepare and file it, Plum handles GST for businesses across Edmonton, Sherwood Park and St. Albert. Book a free 15-minute call and we'll walk through your numbers.
7Questions people ask
How do I calculate the GST I owe?
Add up the GST you charged on sales for the period, then subtract the input tax credits you can claim for GST paid on business purchases. The difference is your net tax. If it's positive you pay it; if it's negative CRA owes you a refund.
Do I report GST on invoices my customers haven't paid yet?
Usually yes. GST generally becomes payable on the earlier of the day the customer pays or the day the invoice is issued or due, so an unpaid December invoice normally belongs on the return that covers December.
How do I work out the GST in a total that already includes it?
Multiply the GST-included total by 5/105. A $210 receipt that includes GST contains $10 of GST and $200 of the actual purchase.
Should line 101 on my GST return include GST?
No. Line 101 is your sales and other revenue before GST. The GST you charged goes on line 103. CRA's line-by-line instructions explain exactly what to include for your situation.
What if my GST return shows a refund?
If your input tax credits are bigger than the GST you collected, the net tax is negative and CRA refunds the difference, as long as all your required returns are filed. Large refunds sometimes trigger a review, so keep the invoices handy.
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Book a free 15-min callThis article is general information for Alberta businesses and isn't tax or legal advice. Rules and thresholds change, so confirm your situation with your accountant or CRA.