Revenu Québec’s Business Life Cycle Obligations

A business goes through several phases and with each one, the business owner has obligations with Revenu Québec. Today, we will examine each phase and explain how to remain compliant as your business grows and changes.

The Launch

This is the most exciting part of your business. You came up with an idea, did a business plan, raised capital, and now it’s time to open the doors. Before you open for business, ensure that you:

  • Register your company. Upon registration you will received an NEQ (enterprise number). The NEQ identifies your business across several government agencies.
  • Register for GST/QST. This is required for businesses with income of $30,000 or more per year, and for small suppliers that meet certain criteria set forth by Revenu Québec.
  • Importers/exporters also need a federal business number, which is applied for through Canada Revenue Agency

Daily Operations

Keeping orderly paperwork and using the services of a bookkeeper make it easier to manage daily, weekly, and monthly obligation such as:

  • Maintain records
  • Producing RL slips
  • Tracking deductions
  • Making installation payments
  • Paying income tax

Growth and Changing

Your business may acquire another company, or you may decide to incorporate. Each comes with its own set of obligations.

  • Acquisition: With a merger, one GST/QST number is retained, or a new one is generated. Special rules apply if one of the companies in in the fuel or tobacco industry.
  • Incorporation: When a company incorporates, consumption taxes, source deductions, and employee contributions are affected. If physical property is involved and transferred within/to the company, the fair market value (FMV) must be counted in the transaction. The rollover rule can be used to defer immediate tax consequences triggered by the incorporation.

Selling or Closing

At some point you may decide to sell, close, or retire from the business. However, not all businesses end by choice. The unfortunate reality is that sometimes businesses go bankrupt.  Revenu Québec has requirements for each scenario, which can be viewed on its website.

It is important to note the following:

  • Closing: Revenu Québec must cancel your GST/QST number. You must also make a final remittance.
  • Bankruptcy: The GST/QST number remains active as the business’ assets are liquidated, or the business continues to operate. If the business transitions to new operations as a result of the bankruptcy, a new GST/QST number must be obtained. A trustee must remit all source deductions to Revenu Québec.

The Best Way to Always Remain Compliant

Forms, remittances, paperwork, filing, deadlines – you face these and more from the launch of your business until you retire! There is no way around it, but you can make it easier on yourself to remain compliant: hire an accountant.

Accountants know what is required as your business starts, grows, and ultimately winds downs. Your professional accountant is key to helping you stay compliant and not miss important filings or deadlines (and therefore avoiding penalties and fees).

To learn more about how an accountant can help you with this and other aspects of your business, contact us today.

Hiring is an important milestone as you grow your business: Here’s How to Stay Compliant with Revenu Quebec When you Hire your First Employee.

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