Entrepreneurship & Small Business

Business car insurance repair bill HST

  • Last Updated:
  • Oct 9th, 2018 10:59 am
[OP]
Sr. Member
Jan 4, 2006
556 posts
40 upvotes

Business car insurance repair bill HST

Hi. I need a bit advice on who is supposed to pay a business car insurance repair bill HST

I have a small company with a car leased under company name. It was recently hit by some one while driven by my wife. That person was rushing through a railway crossing and ended up going up the sidewalk then sideswiped my wife trying to get into the proper lane.

Insurance company established that my wife was not at fault and told us we don't need to pay the deductable. So we had the car repaired under insurance coverage. However, when we were picking up the car, the insurance company told us that we must pay the HST for the repair bill and won't let us take the car unless we paid the HST. Do you know if that's how the business car insurance supposed to work?

I was under the impression that since we were not at fault and the other person's insurance company is covering the repair bill, then it would be all covered. But the insurance adjuster told us that since my company is HST registered, then I have to pay the HST bill. He said I should get the amount back in HST. I said that I think that just means the amount in HST we paid would just be deducted from the company income.

What do you guys think?
2 replies
Sr. Member
Jul 19, 2004
711 posts
76 upvotes
Vancouver
You will get the HST back as an input tax credit when you do your HST return.

For example, if the HST for the repair is $100, then you pay that to the insurance. Then on your HST return you will enter that $100 paid and get a full refund for that amount. In the end it cancels each other out.
[OP]
Sr. Member
Jan 4, 2006
556 posts
40 upvotes
Thanks. I just want to double check this is legit and not some BS my insurance company is trying to pull over me.

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