Selected Listed Financial Institutions Attribution Method (GST/HST) Regulations (SOR/2001-171)

Marginal note:New non-stratified investment plan — reconciliation method

59 If units of a non-stratified investment plan that is a selected listed financial institution are issued, distributed or offered for sale in a particular fiscal year that ends in a particular taxation year of the investment plan, if immediately before the issuance, distribution or offering for sale no units of the investment plan are issued and outstanding and if no election is in effect under section 49, 60 or 61 in respect of the investment plan and the particular fiscal year, the following rules apply:

• (a) for the purposes of this section,

  • (i) the preceding taxation year is the taxation year of the investment plan preceding the particular taxation year, and

  • (ii) the reconciliation day is the day that is the earlier of

    • (A) the day that is 30 days after the attribution point in respect of the investment plan for the preceding taxation year, and

    • (B) the day preceding the day on which a plan merger of the investment plan and one or more other investment plans first occurs;

• (b) for each reporting period of the investment plan that precedes the reporting period of the investment plan that includes the reconciliation day, paragraph 228(2.1)(a) of the Act is adapted as follows:

  • (a) the person shall calculate in the interim return the amount (in this Part referred to as the “interim net tax”) that would be the net tax of the person for the reporting period if the description of C in the formula in subsection 225.2(2) were read as “is an estimate of the financial institution’s percentage for the participating province and for the preceding taxation year of the financial institution, as determined by the financial institution”; and

• (c) for each fiscal quarter of the investment plan that precedes the fiscal quarter of the investment plan that includes the reconciliation day, subsection 237(1) of the Act is adapted as follows:

  • 237 (1) Where the reporting period of a registrant is a fiscal year, the registrant shall, within one month after the end of each fiscal quarter of the registrant ending in the reporting period, pay to the Receiver General an instalment equal to 1/4 of the amount that would be the net tax for the reporting period if the description of C in the formula in subsection 225.2(2) were read as “is an estimate of the financial institution’s percentage for the participating province and for the preceding taxation year of the financial institution, as determined by the financial institution”.

• (d) if the reconciliation day is not included in the particular fiscal year,

  • (i) for the purposes of these Regulations and the description of C in subsection 225.2(2) of the Act and despite sections 19 and 32, the investment plan’s percentage for a participating province and for the preceding taxation year is equal to whichever of the following is applicable:

    • (A) the estimate of that percentage that was used for the purposes of paragraph 228(2.1)(a) of the Act, as adapted by paragraph (b), in determining the interim net tax for the reporting periods of the investment plan that are included in the particular fiscal year, or

    • (B) the estimate of that percentage that was used for the purposes of subsection 237(1) of the Act, as adapted by paragraph (c), in determining the instalments for the fiscal quarters of the investment plan ending in the particular fiscal year,

  • (ii) for the purposes of these Regulations and the description of C in subsection 225.2(2) of the Act and despite sections 19 and 32, the investment plan’s percentage for a participating province and for the taxation year in which the particular fiscal year ends is equal to

    • (A) if an election under section 50 is in effect throughout the particular fiscal year, the investment plan’s percentage for the participating province and for the preceding taxation year, or

    • (B) if no election under section 50 is in effect throughout the particular fiscal year, the percentage that would be the investment plan’s particular percentage for the participating province and for the preceding taxation year if the particular percentage were determined in accordance with the rules set out in

      • (I) paragraph 60.1(b), if the investment plan has elected in prescribed form containing prescribed information to have that paragraph apply, or

      • (II) paragraph 60.1(c), in any other case, and

  • (iii) for the purposes of the description of G in subsection 225.2(2) of the Act, for the reporting period of the investment plan that includes the reconciliation day, the positive or negative amount determined by the following formula is a prescribed amount:

    A – B

    where

    A

    is the total of all amounts, each of which is an amount that would be the net tax for a reporting period of the investment plan that is included in the particular fiscal year if

    • (A) when no election under section 50 is in effect throughout the particular fiscal year, the investment plan’s percentage for a participating province and for the preceding taxation year were determined in accordance with the rules set out in section 60.1, and

    • (B) when an election under section 50 is in effect throughout the particular fiscal year, the investment plan’s percentage for a participating province and for the taxation year in which the particular fiscal year ends were determined in accordance with the rules set out in section 60.1, and

    B

    is the total of all amounts, each of which is the net tax for a reporting period of the investment plan that is included in the particular fiscal year.

Marginal note:New non-stratified investment plan — elected method

60 If units of a non-stratified investment plan that is a selected listed financial institution are issued, distributed or offered for sale in a particular fiscal year that ends in a particular taxation year of the investment plan, if immediately before the issuance, distribution or offering for sale no units of the investment plan are issued and outstanding and if no election is in effect under section 49 or 61 in respect of the investment plan and in respect of the particular fiscal year, the investment plan may elect in prescribed form containing prescribed information to have the following rules apply:

• (a) for the purposes of paragraph (a) of the description of A in subsection 225.2(2) of the Act, any amount of tax under any of subsection 165(1) and sections 212, 218 and 218.01 of the Act that became payable by the investment plan on or before the attribution point (referred to in this section as the “first attribution point”) in respect of the investment plan for the taxation year (in this subsection referred to as the “preceding taxation year”) immediately preceding the particular taxation year or that was paid by the investment plan on or before the first attribution point without having become payable is a prescribed amount of tax; and

• (b) for the purposes of the description of G in subsection 225.2(2) of the Act, for each reporting period in the particular fiscal year that ends after the first attribution point and for each reporting period in the fiscal year of the investment plan that follows the particular fiscal year, the amount determined, for each participating province, by the following formula is a prescribed amount:

  [(A – B)/C] × D × (E/F)

  where

  A

  is the total of all amounts of tax prescribed for the purposes of paragraph (a),

  B

  is the total of all input tax credits of the investment plan that are in respect of an amount of tax prescribed for the purposes of paragraph (a),

  C

  is the total of

  • (i) the total number of reporting periods in the particular fiscal year that end after the first attribution point, and

  • (ii) the total number of reporting periods in the fiscal year of the investment plan that immediately follows the particular fiscal year,

  D

  is

  • (i) if no election under section 50 is in effect throughout the particular fiscal year, the investment plan’s percentage for the participating province and for the preceding taxation year, and

  • (ii) if an election under section 50 is in effect throughout the particular fiscal year, the investment plan’s percentage for the participating province and for the particular taxation year,

  E

  is the tax rate for the participating province, and

  F

  is the rate set out in subsection 165(1) of the Act.

Marginal note:New non-stratified investment plan — percentage

60.1 If units of a non-stratified investment plan that is a selected listed financial institution and not an exchange-traded fund are issued, distributed or offered for sale in a particular fiscal year that ends in a particular taxation year of the investment plan, if immediately before the issuance, distribution or offering for sale no units of the investment plan are issued and outstanding, if no election is in effect under section 49 or 61 in respect of the investment plan throughout the particular fiscal year and if paragraph 59(d) does not apply to the investment plan, the following rules apply:

• (a) for the purposes of this section,

  • (i) the particular attribution point is the attribution point in respect of the investment plan for the taxation year of the investment plan that precedes the particular taxation year (in this section referred to as the “preceding taxation year”), and

  • (ii) the particular calendar year is the calendar year that includes the particular attribution point;

• (b) if the investment plan has elected in prescribed form containing prescribed information to have this paragraph apply, subsections 32(1) and (2) apply for the purpose of determining the investment plan’s percentage for a participating province and for the preceding taxation year, except that the description of C in paragraph 32(1)(a) and the description of C in paragraph 32(1)(b) are each to be read without reference to subparagraph (ii);

• (c) if paragraph (b) does not apply,

  • (i) for the purposes of these Regulations and the description of C in subsection 225.2(2) of the Act and despite sections 19 and 32, the investment plan’s percentage for the preceding taxation year and for any one participating province (in this paragraph referred to as the “selected province”) having the highest tax rate on the first day of the particular fiscal year is the percentage determined by the formula

    (A/B) + (C × A/D) + [(1 – C) – (D/B)]

    where

    A

    is the total of all amounts, each of which is the total value of the units of the investment plan held, on the particular attribution point, by a person that the investment plan knows, on December 31 of the particular calendar year, is resident in the selected province on the particular attribution point,

    B

    is the total value, on the particular attribution point, of the units of the investment plan other than units held, on the particular attribution point, by a person that the investment plan knows, on December 31 of the particular calendar year, is not resident in Canada on the particular attribution point,

    C

    is the lesser of 0.1 and the amount determined by the formula

    C₁/C₂

    where

    C₁

    is the total of all amounts, each of which is the total value of the units of the investment plan held, on the particular attribution point, by a person in respect of which the investment plan does not know, on December 31 of the particular calendar year, whether or not the person is resident in Canada on the particular attribution point or, in the case of persons resident in Canada, the province in which the person is resident on the particular attribution point, and

    C₂

    is the amount determined for B, and

    D

    is the total of all amounts, each of which is the total value of the units of the investment plan held, on the particular attribution point, by a person resident in Canada on the particular attribution point and in respect of which the investment plan knows, on December 31 of the particular calendar year, the province in which the person is resident on the particular attribution point,

  • (ii) for the purposes of these Regulations and the description of C in subsection 225.2(2) of the Act and despite sections 19 and 32, the investment plan’s percentage for the preceding taxation year and for a participating province (other than the selected province) in which the investment plan has a permanent establishment in the particular taxation year is the percentage determined by the formula

    (A/B) + (C × A/D)

    where

    A

    is the total of all amounts, each of which is the total value of the units of the investment plan held, on the particular attribution point, by a person that the investment plan knows, on December 31 of the particular calendar year, is resident in the participating province on the particular attribution point,

    B

    is the total value, on the particular attribution point, of the units of the investment plan other than units held, on the particular attribution point, by a person that the investment plan knows, on December 31 of the particular calendar year, is not resident in Canada on the particular attribution point,

    C

    is the lesser of 0.1 and the amount determined by the formula

    C₁/C₂

    where

    C₁

    is the total of all amounts, each of which is the total value of the units of the investment plan held, on the particular attribution point, by a person in respect of which the investment plan does not know, on December 31 of the particular calendar year, whether or not the person is resident in Canada on the particular attribution point or, in the case of persons resident in Canada, the province in which the person is resident on the particular attribution point, and

    C₂

    is the amount determined for B, and

    D

    is the total of all amounts, each of which is the total value of the units of the investment plan held, on the particular attribution point, by a person resident in Canada on the particular attribution point and in respect of which the investment plan knows, on December 31 of the particular calendar year, the province in which the person is resident on the particular attribution point, and

  • (iii) for the purposes of subparagraphs (i) and (ii), if, for the particular attribution point, the total of all amounts — each of which is the total value of the particular units of the investment plan held on the particular attribution point by a person in respect of which the investment plan knows, on December 31 of the particular calendar year, whether or not the person is resident in Canada on the particular attribution point and knows, in the case of persons resident in Canada, the province in which the person is resident on the particular attribution point — is less than 50% of the total value of the units of the investment plan on the particular attribution point,

    • (A) the units of the investment plan, other than the particular units, are deemed to be held on the particular attribution point by a particular person and not by any other person,

    • (B) the particular person is deemed to be resident on the particular attribution point in Canada and in the selected province referred to in subparagraph (i) for the preceding taxation year, and

    • (C) the investment plan is deemed to know on December 31 of the particular calendar year that the particular person is, on the particular attribution point, resident in Canada and in the selected province; and

• (d) if the particular attribution point is after September 30 of the calendar year in which the particular fiscal year ends, for the purposes of these Regulations and the description of C in subsection 225.2(2) of the Act and despite sections 19 and 32, the investment plan’s percentage for a participating province and for the particular taxation year is equal to the investment plan’s percentage for the participating province and for the preceding taxation year.