The Government of British Columbia announced in the 2020 Budget that new Provincial Sales Tax (PST) registration requirements will apply as of July 1, 2020. Canadian sellers of goods, as well as Canadian and foreign sellers of software and telecommunications services, will be required to register to collect PST if their specified BC revenues exceed $10,000. In addition, all Canadian vendors of steam-based products will be required to register if they deliver steam-based products to consumers in British Columbia. These requirements will result in more businesses in the digital economy collecting provincial sales tax. Link for B.C.’s 2020 budget.
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British Columbia: Government Contracts
British Columbia has recently followed Quebec’s lead with the introduction of the requirement for suppliers to get a “certificate” prior to obtaining a contract with the province. Effective January 1, 2020, suppliers must provide a Tax Verification Letter before they can enter into, extend or renew contracts with the Province of British Columbia valued at $100,000 or more (including all fees, expenses and extension or renewal options). There are, however, certain exceptions to this requirement. Note that a Tax Verification Letter is still required when the vendor does not have a PST account with the province or is not a
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2020: Final Year of the Phase-Out of Restricted ITRs
If you qualify as a large business for QST purposes, remember that you can claim 75% of the QST that is paid or has become payable since January 1, 2020 on expenses subject to input tax refund (“ITR”) restrictions. ITR restrictions are gradually eliminated by 25% per year starting in 2018. As a result, a large business can claim a portion of the QST paid on the restricted expenses as follows: 2018 : 25 %; 2019 : 50 %; 2020 : 75 %; 2021 and subsequent years: 100%. In summary, expenses subject to ITR restrictions include: Road vehicles weighing less than
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Evidence of Exportation When the Supplier Ships Property Outside Canada
The GST/HST and QST systems rely heavily on transaction documentation. The Tax Court of Canada (TCC) confirmed this principle in Dow & Duggan Log Homes International (1993) Limited v. The Queen, 2019 TCC 280 (CanLII). As a reminder, the supply of tangible personal property (TPP) may not be subject to GST/HST and QST when, in the case of a sale, it is delivered to the recipient outside Canada or is, or will be, made available outside Canada, or in the case of a supply by way of lease, it is made available to the recipient outside Canada (see 142(2)(a) and
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New publications on education in the GST/HST Memoranda Series
This week the Canada Revenue Agency released several publications on education-and GST/HST: GST/HST Memorandum 20-1 – School Authorities – Elementary and Secondary Schools (December 2019) GST/HST Memorandum 20-2 – Public Colleges (December 2019) GST/HST Memorandum 20-3 – Universities (December 2019) GST/HST Memorandum 20-4 – Vocational Schools and Courses (December 2019) GST/HST Memorandum 20-5 – School Cafeterias, University and Public College Meal Plans, and Food Service Providers (December 2019) GST/HST Memorandum 20-6 – Tutoring and Equivalent Services (December 2019) GST/HST Memorandum 20-7 – Second-language Instruction (December 2019) GST/HST Memorandum 20-8 – Educational Services Made to a Non-resident (December 2019) GST/HST Memorandum
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General principles for determining the application of the health care exemptions: Fasciatherapy Danis Bois’ method
In the Interpretation Letter 17-038655-001, Revenu Québec summarizes the steps that must be taken to determine the application of the health care exemptions under Part II of Schedule V of the Excise Tax Act (ETA) and the corresponding measures in the Act Respecting the Québec Sales Tax. “Part II of Schedule V to the ETA (Part II) provides for supplies of health care services that are exempt for the purposes of the ETA, excluding the following supplies that are deemed not to be included in Part II, namely Except for the purposes of section 9 of Part II, cosmetic services
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Second year of the phase-out of the ITR restrictions
If your business is a large business for QST purposes, remember that you can claim 50% of the QST paid since January 1, 2019 on expenses subject to input tax refund (“ITR”) restrictions. ITR restrictions are gradually eliminated by 25% per year starting in 2018. As a result, a large business can claim a portion of the QST paid on the restricted expenses as follows: 2018 : 25 %; 2019 : 50 %; 2020 : 75 %; 2021 and subsequent years: 100%. In summary, expenses subject to ITR restrictions include: Road vehicles weighing less than 3,000 kg that must be
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The 2018 federal budget: not too exciting !
The 2018 federal budget presented today is not very exciting in terms of commodity taxes. In fact, it announces some changes to the new measures relating to investment limited partnerships, increases the excise duty rate on tobacco products and the introduction of an excise duty to tax cannabis. In addition, the Government has announced its intention to consult on the rules allowing a parent corporation to claim input tax credits to recover the GST/HST paid in respect of expenses that relate to another Corporation. You can consult the budget documents on Finance Canada’s website. Follow this link.
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