A subcontractor - HST registrant
Details: completed job - 10 hours & rate - $20.00/hr
In addition, fuel truck to get to the site $20.00 & purchase supplies - Home Depot ($30.00 + tax) $33.90 both of which he is reimbursed
- sends invoices to contractor as follows:
Services $200.00 HST $26.00 $226.00
Expense (reimbursement) $20.00
Expense (reimbursement) $33.90
Subcontractor completes income tax return claiming $200.00 for services
Also, completes HST return - he will include HST collected - $26.00
As for the reimbursements he will not claim the expenses or the ITC’s because he is reimbursed.
Is this correct?