Canada - English

Ontario to Eliminate RST Refunds Early 

Canadian Tax Adviser


April 24, 2012


Act Now or Lose Potential Refunds


You only have a few months left to recover any overpaid Ontario Retail Sales Tax (RST). Ontario announced in its 2012 budget that it plans to shorten the Ontario RST refund period to no later than December 31, 2012. Though Ontario replaced the PST by introducing the HST effective July 1, 2010, the province had maintained the four-year deadline to claim overpaid RST. This four-year period has now been shortened to a maximum of two and a half years, depending on your circumstances.

Act now for potential refunds
If your organization has overpaid Ontario RST, you have to act now to identify and recover those amounts. Like many other provincial and federal tax systems, Ontario allows you to recover overpaid taxes within a specific time. However, with the proposed budget measure, you only have a few months left to review your transactions to determine whether you have overpaid Ontario RST. KPMG can help you with this process.

Why do businesses overpay
Many businesses have overpaid Ontario RST or other taxes at some point for various reasons, including:


  • Incorrectly applying transitional rules for Ontario harmonization
  • Paying Ontario RST on exempt goods and services
  • Paying Ontario RST on goods or services consumed outside of Ontario
  • Incorrectly valuing self-assessed taxable goods and services
  • Making errors in self-assessment and processing
  • Having RST issues related to coupons and loyalty programs
  • Adjusting sales amounts.


Why do public sector organizations overpay
Like businesses, many public sector organizations have also overpaid Ontario RST and other taxes from time to time for similar reasons and also because they may not have claimed various exemptions specific to these organizations, including exemptions for some publications and other printed matter and for prepared food products.


These overpayments of taxes are often recoverable if claimed before specific deadlines. For Ontario RST, this deadline now is fast approaching.


How KPMG can help


KPMG can help you identify overpaid Ontario RST and indirect taxes quickly and efficiently by using advanced technology to access, analyze and compare the large volume of transactional data from your systems and validate recovery finding using advanced transaction audit techniques. We can also help you complete refund claims and manage any audits of these claims by the tax authorities.


Canadian companies may be interested in these recent publications: