Excise Tax Act

Marginal note:Supplies between branches

220 For the purposes of this Division, where a person carries on a business through a permanent establishment of the person in Canada and through another permanent establishment outside Canada,

• (a) any transfer of personal property or rendering of a service by one permanent establishment to the other permanent establishment shall be deemed to be a supply of the property or service;

• (b) in respect of that supply, the permanent establishments shall be deemed to be separate persons who deal with each other at arm’s length;

• (c) the value of the consideration for that supply shall be deemed to be the fair market value of the supply at the time the property is so transferred or the service is so rendered; and

• (d) the consideration for that supply shall be deemed to have become due and to have been paid, by the permanent establishment (in this paragraph referred to as “the recipient”) to which the property was transferred or the service was rendered, to the other permanent establishment at the end of the taxation year of the recipient in which the property was transferred or the service was rendered.