Did you notice a mysterious $100. or $330 deposit in your bank account? Or did you receive a $100 or $330 check you did not expect? It's your first Ontario HST transition payment, its part of the program designed to help consumers cope with the new taxable services under the HST that starts on July 1. ( and accept the HST reform)
Payment contingent on filing of income tax return
All families and individuals that have filed their 2009 income tax return are entitled to this transition benefit. Full benefit is payable to individuals whose net income is $80,000 or less and to families whose net family income is $160,000 or less for 2009.
Individuals will receive two other $100 payments in December of this year and in June 2011 for a total $300.
Families will receive two more $335 payments at the same time for a total of $1000.
The June 2011 payments are evidently contingent upon the filing of the 2010 tax return.
Individuals earning more than $80,000 will receive less and the benefit will disappear if the net revenue exceeds $82,000 in 2009; the same is true for families, but the phase out number is a net family income of $166,700.
Persons who have opted in their income tax return for "direct deposit" will receive payment directly in their bank account; others will receive as check. So check out your bank balance, you may not be as poor as you think!
Use it before July 1 for a double benefit.
A good tax planning idea is to use the payment to purchase services that are currently exempt but will be taxable under the HST as of July 1, such as that new hairdo or trip at the spa. This way you get the money and avoid the HST. Like keeping your cake as well as eating it!
Even if the service is purchased now, make sure it is rendered to you before July 1 or the HST will apply anyway as discussed in our previous columns.
It's also a good idea to remind friends who do not earn enough to pay income tax that they should still file an income tax return in order to benefit from GST/HST credits, some Ontario credits; its also the only way to get this special one time HST transition credit.
Go back to our previous HST columns to learn more...
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