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

Full Document:  

Act current to 2022-09-11 and last amended on 2022-09-01. Previous Versions

PART IXGoods and Services Tax (continued)

DIVISION IXTransitional Provisions (continued)

Property and Services (continued)

Marginal note:Budget arrangements

  •  (1) Where a supply of property or a service (other than a subscription for newspapers, magazines or other publications published periodically) is made and the consideration for the supply of the property or service delivered, performed or made available during any period beginning before 1991 and ending after 1990 is paid by the recipient under a budget payment arrangement with a reconciliation of the payments to take place at or after the end of the period and before 1992, at the time the supplier issues an invoice for the reconciliation of the payments, the supplier shall determine the positive or negative amount determined by the formula

    A - B

    where

    A
    is the tax that would be payable by the recipient for the part of the property or service supplied during the period that was delivered, performed or made available after 1990, if the consideration therefor had become due and been paid after 1990; and
    B
    is the total tax payable by the recipient in respect of the supply of the property or service delivered, performed or made available during the period.
  • Marginal note:Collection of tax

    (2) Where the amount determined under subsection (1) in respect of a supply of property or a service is a positive amount and the supplier is a registrant, the supplier shall collect, and be deemed to have collected on the day the invoice for the reconciliation of payments is issued, that amount from the recipient as tax.

  • Marginal note:Refund of excess

    (3) Where the amount determined under subsection (1) in respect of a supply of property or a service is a negative amount and the supplier is a registrant, the supplier shall refund or credit that amount to the recipient and issue a credit note for that amount in accordance with section 232.

  • Marginal note:Continuous supply

    (4) Where a supply of property or a service, during any period for which the supplier issues an invoice for the supply, is made on a continuous basis by means of a wire, pipeline or other conduit and, because of the method of recording the delivery of the property or the provision of the service, the time at which the property or a part thereof is delivered, or the time at which the service or a part thereof is provided, cannot reasonably be determined, an equal part of the whole of the property delivered, or of the whole of the service provided, in the period shall, for the purposes of this section, be deemed to have been delivered or provided, as the case may be, on each day of the period.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1990, c. 45, s. 12

Marginal note:Progress payments

 Where a taxable supply is made under a contract to construct, renovate, alter or repair real property or a ship or other marine vessel,

  • (a) any consideration for the supply that becomes due or is paid without becoming due after August 1989 and before 1991 as a progress payment required under the contract shall be deemed, for the purposes of this Part, to have become due on January 1, 1991 and not to have been paid before 1991;

  • (b) no tax is payable in respect of any part of the consideration for the supply that may reasonably be attributed to property delivered and services performed under the contract before 1991; and

  • (c) where paragraph 168(3)(c) applies in respect of the supply, tax is payable in respect thereof and the construction, renovation, alteration or repair is substantially completed before December 1990, the construction, renovation, alteration or repair shall be deemed, for the purposes of this Part, to have been substantially completed on December 1, 1990 and not before that day.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1990, c. 45, s. 12

Marginal note:Prepayment of rent and royalties

  •  (1) Subject to subsection (3), where a taxable supply of property is made in Canada to a person by way of lease, licence or similar arrangement, any payment of consideration for the supply that became due after August 1990 and before 1991, or that was paid after August 1990 and before 1991 without becoming due, to the extent that the payment is rent, royalty or a similar payment attributable to a period after 1990, shall be deemed to have become due on January 1, 1991 and not to have been paid before 1991 and, where the supplier is a registrant, tax is payable in respect of the amount of consideration so deemed to have become due.

  • Marginal note:Idem

    (2) Subject to subsection (3), where a taxable supply of property by way of lease, licence or similar arrangement is made in Canada to a person other than a consumer by a supplier in the ordinary course of a business, to the extent that any consideration for the supply that became due after August 1989 and before September 1990 or was paid after August 1989 and before September 1990 without becoming due is rent, royalty or a similar payment that is attributable to a period after 1990, tax is payable in respect of that consideration and the person shall, on or before April 1, 1991, file with the Minister in prescribed manner a return in prescribed form containing prescribed information and remit the tax in respect of that consideration to the Receiver General.

  • Marginal note:Rent, etc. paid before 1994 under certain leases

    (3) No tax is payable in respect of any consideration paid before 1994 under an agreement in writing entered into before 1991 for the supply by way of lease of property that is

    • (a) an automobile, or

    • (b) equipment for use by a medical practitioner or a practitioner (within the meanings assigned by section 1 of Part II of Schedule V) in supplying services in the course of practising the profession of the medical practitioner or practitioner, as the case may be,

    and the possession of which is transferred to the recipient of the supply before 1991, to the extent that that consideration is rent or other payment under the agreement that is attributable to a period before 1994 or to the extent that that consideration is attributable to the acquisition of the property.

  • Marginal note:Periods before 1991

    (4) Where a taxable supply of property is made to a person by way of lease, licence or similar arrangement, no tax is payable in respect of the consideration for the supply that became due before May 1991, or that was paid before May 1991 without becoming due, to the extent that the consideration is rent, royalty or a similar payment attributable to a period before 1991.

  • Marginal note:Application

    (5) Subsections (1), (2) and (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:Agreements before August 8, 1989

    (6) Where under an agreement in writing entered into before August 8, 1989

    • (a) a supply by way of lease of tangible personal property that is capital property of the supplier, or

    • (b) a supply by way of sub-lease of tangible personal property that is capital property of the person who supplied the property by way of lease to the sub-lessor,

    is made to a person, no tax is payable in respect of any consideration for any supply of the property under the agreement.

  • Marginal note:Variation of agreement

    (7) Where an agreement in writing is renewed after August 7, 1989 or is varied or altered after August 7, 1989 to vary or alter the term of the agreement or the property affected by the agreement, the agreement shall be deemed, for the purposes of subsection (6), to have been entered into after August 7, 1989.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1990, c. 45, s. 12
  • 1994, c. 9, s. 24

Marginal note:Adjustments

  •  (1) Where a person remits tax under subsection 337(6) or 340(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 that was calculated on the amount by which the consideration or part thereof was reduced, that portion shall be deemed, for the purposes 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 or 176 applies.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1993, c. 27, s. 138

Marginal note:Services before 1991

  •  (1) No tax is payable in respect of any consideration that is paid or becomes due before May 1991 for a supply of a service (other than a freight transportation service or a service that is the transportation of an individual) to a person if all or substantially all of the service was performed before 1991.

  • Marginal note:Idem

    (2) Where all or substantially all of a service (other than a freight transportation service or a service that is the transportation of an individual) that is supplied to a person is not performed before 1991, no tax is payable in respect of any consideration for the supply that is paid or becomes due before May 1991 to the extent that that consideration relates to any part of the service that was performed before 1991.

  • Marginal note:Payments before 1991

    (3) Subject to subsection 337(2), where any consideration for a taxable supply of a service (other than a freight transportation service or a service that is the transportation of an individual) is paid after August 1990 and before 1991 without having become due or becomes due after August 1990 and before 1991, that consideration shall be deemed to have become due on January 1, 1991 and not to have been paid before 1991.

  • 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 shall be deemed to be supplies of a service, but a supply of a right to acquire a membership in a club, an organization or an association shall be deemed to be a supply of property.

  • Marginal note:Combined supply

    (5) For the purposes of subsection 168(8), 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,

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

    • (c) no tax would be payable in respect of an element that is property the ownership or possession of which is transferred to the recipient before 1991 if that element were supplied separately,

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

  • Marginal note:Application

    (6) This section does not apply to a supply in respect of which section 338 applies.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1990, c. 45, s. 12
  • 1993, c. 27, s. 139

Marginal note:Legal service performed before 1991

  •  (1) No tax is payable in respect of the consideration for a supply of a legal service to the extent that the consideration relates to any part of the service that was performed before 1991 and, under the agreement for the supply, does not become due

    • (a) until allowed, directed or ordered by a court; or

    • (b) until the completion or termination of the service provided by the supplier.

  • Marginal note:Service of representative, trustee, receiver or liquidator

    (2) No tax is payable in respect of the consideration for a supply of a service of a personal representative in respect of the administration of an estate, or a service of a trustee, receiver or liquidator, to the extent that the consideration relates to any part of the service that was performed before 1991 and does not become due

    • (a) in the case of the service of a personal representative, until it is approved by all beneficiaries of the estate or in accordance with the terms of the trust binding the personal representative;

    • (b) in the case of the service of a trustee, until a date determined under the terms of the trust or an agreement in writing for the supply; or

    • (c) in any case, until it is allowed, directed or ordered by a court.

  • Marginal note:Idem

    (3) For the purposes of subsections (1) and (2), where substantially all of a service is performed before 1991, all of the service shall be deemed to have been performed before 1991.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1993, c. 27, s. 140

Marginal note:Transportation of individuals

  •  (1) No tax is payable in respect of a supply of a service that is the transportation of an individual (other than a service to which subsection (3) applies) where the service begins before 1991.

  • Marginal note:Idem

    (2) Where any consideration for a supply of a service that is the transportation of an individual (other than a service to which subsection (3) applies) is paid after August 1990 and before 1991 without having become due or becomes due after August 1990 and before 1991, that consideration shall be deemed to have become due on January 1, 1991 and not to have been paid before 1991.

  • Marginal note:Transportation pass before February 1991

    (2.1) No tax is payable in respect of a supply made by a person to an individual of a transportation pass that entitles the individual to transportation services during a period beginning before 1991 and ending before February 1991 without payment of consideration by the individual each time a supply of a transportation service is made to the individual.

  • Marginal note:Transportation pass

    (3) Where a supply is made by a person to an individual of a transportation pass that entitles the individual to transportation services during a period beginning before 1991 and ending after January 1991 without payment of consideration by the individual each time a supply of a transportation service is made to the individual, and consideration for the pass becomes due after August 1990 and before May 1991 or is paid after August 1990 and before May 1991 without becoming due, the part of the consideration for the pass determined by the formula

    A × (B/C)

    where

    A
    is amount of the consideration for the pass,
    B
    is the number of days in the period that are after 1990, and
    C
    is the number of days in the period,

    shall be deemed to have become due on January 1, 1991 and not to have been paid before 1991.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1990, c. 45, s. 12
  • 1993, c. 27, s. 141

Marginal note:Freight transportation services

  •  (1) Where one or more carriers make a supply of freight transportation services in respect of a continuous freight movement of tangible personal property and, before 1991, the shipper of the property transferred possession of the property to the first carrier engaged in the continuous freight movement, no tax is payable in respect of any consideration for the supply that is paid or becomes due before May 1991.

  • Marginal note:Freight transportation services after 1990

    (2) Where

    • (a) one or more carriers make a supply in Canada of freight transportation services in respect of a continuous freight movement of tangible personal property,

    • (b) the shipper of the property does not transfer possession of the property before 1991 to the first carrier engaged in the continuous freight movement, and

    • (c) consideration for the supply is paid or becomes due after August 1990 and before 1991,

    that consideration shall be deemed to have become due on January 1, 1991 and not to have been paid before 1991.

  • Marginal note:Interpretation

    (3) For the purposes of this section, “carrier”, “continuous freight movement”, “freight transportation service” and “shipper” have the same meanings as in Part VII of Schedule VI.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1990, c. 45, s. 12
 
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