Excise Tax Act (R.S.C., 1985, c. E-15)

Marginal note:Prepayments of rent and royalties after specified pre-implementation date

• 354 (1) Subject to subsection (4), where

  • (a) a taxable supply of property by way of lease, licence or similar arrangement is made

    • (i) in a participating province by a registrant to a person, or

    • (ii) outside the participating provinces to a person to whom the property is delivered or made available, or physical possession of the property is transferred, in a participating province, and

  • (b) consideration for the supply that is rent, royalty or a similar payment attributable to a period on or after the implementation date for that participating province became due on or after the specified pre-implementation date for that participating province and before the implementation date for that province or was paid on or after that specified pre-implementation date and before that implementation date without having become due,

  that consideration is deemed, for the purpose of applying subsection 165(2), 218.1(1) or 220.08(1) to the supply, as the case may require, to have become due on that implementation date and not to have been paid before that implementation date.

• Marginal note:Prepayments of rent and royalties before specified pre-implementation date

  (2) Subject to subsection (4), where

  • (a) a taxable supply of property by way of lease, licence or similar arrangement is made

    • (i) in a participating province by a registrant to a person who is not a consumer, or

    • (ii) outside the participating provinces to a person who is not a consumer and to whom either the property is delivered or made available, or physical possession of the property is transferred, in a participating province, and

  • (b) consideration for the supply that is a rent, royalty or similar payment attributable to a period on or after the implementation date for that participating province became due after the announcement date for that participating province and before the specified pre-implementation date for that province or was paid after that announcement date and before that specified pre-implementation date without having become due,

  the following rules apply:

  • (c) tax under subsection 165(2), 218.1(1) or 220.08(1), as the case may require, is, notwithstanding subsection 218.1(2) and section 220.04, payable in respect of that consideration if, but for subsection 218.1(2) and section 220.04, it would have been payable if the consideration had become due and been paid on the implementation date for the province and, in the case of tax under subsection 220.08(1), if section 1 of Part II of Schedule X did not apply, unless, in the case of tax under subsection 165(2) or 220.08(1),

    • (i) the person is neither a registrant that is a selected listed financial institution nor a registrant whose net tax is determined under section 225.1 or under Part IV or V of the Streamlined Accounting (GST/HST) Regulations, and

    • (ii) the property is acquired by the person for consumption, use or supply exclusively in commercial activities of the person,

  • (d) where the person is a registrant whose return under section 238 for the reporting period that includes the implementation date for the province is required to be filed on a particular day before the day that is four months after that implementation date, the person shall pay the tax to the Receiver General on or before the particular day and report the tax in that return, and

  • (e) where paragraph (d) does not apply, section 219 and subsection 220.09(1) do not apply in respect of that tax and the person shall, before the day that is four months after that implementation date, pay the tax to the Receiver General and file with the Minister in prescribed manner a return in respect of the tax in prescribed form containing prescribed information.

• Marginal note:Periods before implementation

  (3) Where a taxable supply of property by way of lease, licence or similar arrangement is made

  • (a) in a participating province to a person, or

  • (b) outside the participating provinces to a person to whom the property is delivered or made available, or physical possession of the property is transferred, in a participating province,

  no tax is payable under subsection 165(2), 218.1(1) or 220.08(1) in respect of the consideration for the supply that becomes due before the particular day that is four months after the implementation date for that participating province, or is paid before the particular day without having become due, to the extent that the consideration is rent, royalty or a similar payment attributable to a period before that implementation date.

• Marginal note:Period including implementation date

  (4) Where a taxable supply of property by way of lease, licence or similar arrangement is made

  • (a) in a participating province to a person, or

  • (b) outside the participating provinces to a person to whom the property is delivered or made available, or physical possession of the property is transferred, in a participating province,

  no tax is payable under subsection 165(2), 218.1(1) or 220.08(1) in respect of consideration for the supply that is rent, royalty or a similar payment attributable to a period that begins before the implementation date for that participating province and ends before the day that is one month after the day immediately before that implementation date.

• Marginal note:Exception

  (4.1) Subsection (4) does not apply in respect of consideration for a supply of property that is rent, royalty or a similar payment attributable to a period if the supplier supplies services in respect of that property for the same period and the consideration for the supply of the property and the consideration for the supply of the services is included in a single invoice.

• Marginal note:Application

  (5) Subsections (1) to (4) do not apply in respect of payments of consideration for the use of, or the right to use, intangible personal property where the amount of the payment is not dependent on the amount of the use of or production from, or the profit from the use of or production from, the property.

Marginal note:Specified motor vehicle leases

354.1 If

• (a) a supply of a specified motor vehicle is made by way of lease, licence or similar arrangement for a lease interval (within the meaning of subsection 136.1(1)) under an agreement entered into before the implementation date for a participating province,

• (b) used tangible personal property, or a leasehold interest in such property, (in this section referred to as the “trade-in”) is accepted by the supplier as full or partial consideration for the supply,

• (c) the retail sales tax of the province would have been payable by the recipient in respect of that lease interval had the trade-in not been accepted and that tax not been suspended or repealed concurrent with the application to that supply of subsection 165(2) or 218.1(1), as the case may be, and

• (d) the value of the consideration for the supply as otherwise determined under this Part exceeds the amount (in this section referred to as the “adjusted value”) that is the value, excluding the amount of any tax under this Part in respect of the supply, on which that retail sales tax in respect of that lease interval would have been calculated but for the suspension or repeal of that tax,

for the purposes of subsection 165(2) or 218.1(1), as the case may be, the value of the consideration for the supply is deemed to be equal to the adjusted value.

Marginal note:Adjustments

• 355 (1) Where a person pays tax under subsections 352(9) or (10) or 354(2) calculated on the consideration or a part thereof for a taxable supply and that consideration or part thereof is subsequently reduced, to the extent that the person did not claim, and is not, but for this section, entitled to claim, an input tax credit or a rebate in respect of the portion of the tax payable under subsection 165(2), 218.1(1) or 220.08(1) that was calculated on the amount by which the consideration or part thereof was reduced, that portion is deemed, for the purpose of determining a rebate under section 261, to be an amount that was not payable or remittable by the person.

• Marginal note:Application

  (2) Subsection (1) does not apply in circumstances in which section 161 applies.

Marginal note:Services substantially all performed before implementation

• 356 (1) Where a supply (other than a supply to which subsection (6) applies) of a service (other than a freight transportation service or a service that is the transportation of an individual) is made in a participating province, or is made outside the participating provinces to a person who is resident in a participating province, and all or substantially all of the service was performed before the implementation date for that participating province, no tax is payable under subsection 165(2), 218.1(1) or 220.08(1) in respect of any consideration for the supply that is paid or becomes due before the day that is four months after that implementation date.

• Marginal note:Services partly performed before implementation

  (2) Where a supply (other than a supply to which subsection (6) applies) of a service (other than a freight transportation service or a service that is the transportation of an individual) is made in a participating province, or is made outside the participating provinces to a person who is resident in a participating province, and all or substantially all of the service was not performed before the implementation date for that province, no tax is payable under subsection 165(2), 218.1(1) or 220.08(1) in respect of any consideration for the supply that is paid or becomes due before the day that is four months after that implementation date to the extent that the consideration relates to any part of the service that was performed before that implementation date.

• Marginal note:Pre-payments after specified pre-implementation date for services

  (3) Subject to subsections 351(8) and 352(5), where a taxable supply (other than a supply to which subsection (6) applies) of a service (other than a freight transportation service or a service that is the transportation of an individual) is made in a participating province, or is made outside the participating provinces to a person who is resident in a participating province, and any consideration for the supply becomes due, or is paid without having become due, on or after the specified pre-implementation date for that province and before the implementation date for that province, for any part of the service that was not performed before that implementation date, that consideration is deemed, for the purpose of applying subsection 165(2), section 218.1 or subsection 220.08(1), as the case may require, to the supply, to have become due on that implementation date and not to have been paid before that implementation date.

• Marginal note:Memberships and admissions

  (4) For the purposes of this Division, a supply of a membership in a club, an organization or an association and a supply of an admission in respect of a place of amusement, a seminar, an activity or an event in a participating province are each deemed to be a supply of a service, but a supply of a right to acquire a membership in a club, an organization or an association is deemed to be a supply of property.

• Marginal note:Admissions sold before announcement

  (5) Where a taxable supply of an admission to a dinner, ball, concert, show or like event in a participating province is made to a person on or before the announcement date for the participating province,

  • (a) no tax is payable under subsection 165(2) in respect of any supply of an admission to that event; and

  • (b) no amount in respect of tax payable under subsection 165(2), section 212.1 or subsection 218.1(1), 220.05(1), 220.06(1), 220.07(1) or 220.08(1) shall be included in determining an input tax credit of the supplier in respect of any property or service to the extent that it was acquired, imported or brought into a participating province by the supplier for consumption or use in making supplies of those admissions or in holding that event.

• Marginal note:Lifetime memberships

  (6) Where a supply of a membership for the lifetime of an individual is made in a participating province, or is made outside the participating provinces to a person who is resident in a participating province, and the total of all amounts that were paid after the announcement date for that province and before the implementation date for that province as consideration for the supply exceeds 25% of the total consideration for the supply, for the purpose of applying subsection 165(2), 218.1(1) or 220.08(1) to the supply, as the case may require, the excess amount is deemed to have become due on that implementation date and not to have been paid before that implementation date.

• Marginal note:Combined supply

  (7) For the purpose of determining when tax under subsection 165(2) becomes payable in respect of a supply made in a participating province, where

  • (a) any combination of service, personal property or real property (each of which is in this subsection referred to as an “element”) is supplied in a participating province,

  • (b) the consideration for each element is not separately identified, and

  • (c) no tax would be payable under subsection 165(2) in respect of an element that is property, the ownership or possession of which is transferred to the recipient before the implementation date for that province, if that element were supplied separately,

  the element mentioned in paragraph (c) is deemed to have been supplied separately from all of the other elements.

• Marginal note:Application

  (8) This section does not apply to a supply in respect of which section 353 applies.