Budget Implementation Act, 2006 (S.C. 2006, c. 4)
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Assented to 2006-06-22
PART 1AMENDMENTS RELATING TO THE GST/HST RATE REDUCTION
Amendments Relating to the GST/HST
R.S., c. E-15Excise Tax Act
Marginal note:1993, c. 27, s. 111(1)(F)
26. (1) Paragraph 255(2)(d) of the Act is replaced by the following:
(d) the total (in this subsection referred to as the “total consideration”) of all amounts, each of which is the consideration payable for the supply to the particular individual of the share or an interest in the corporation, complex or unit, is less than $477,000,
Marginal note:1990, c. 45, s. 12(1)
(2) Paragraphs 255(2)(g) and (h) of the Act are replaced by the following:
(g) if the total consideration is not more than $371,000, an amount equal to the lesser of $7,560 and 2.04% of the total consideration, and
(h) if the total consideration is more than $371,000 but less than $477,000, the amount determined by the formula
A × [($477,000 - B)/$106,000]
where
- A
- is the lesser of $7,560 and 2.04% of the total consideration, and
- B
- is the total consideration.
Marginal note:2000, c. 30, s. 73(1)
(3) Paragraph 255(2.1)(c) of the Act is replaced by the following:
(c) the individual is entitled to a rebate under subsection (2) in respect of the share or would be so entitled if the total (in this subsection referred to as the “total consideration”) of all amounts, each of which is the consideration payable for the supply to the individual of the share or an interest in the corporation, complex or unit, were less than $477,000,
(4) Subsections (1) to (3) apply for the purpose of determining a rebate in respect of a supply, by a cooperative housing corporation to an individual, of a share of the capital stock of the corporation if the individual is acquiring the share for the purposes of using a residential unit in a residential complex as the primary place of residence of the individual, or a relation (as defined in subsection 255(1) of the Act) of the individual, and the rebate application is filed on or after July 1, 2006, unless the corporation paid tax under subsection 165(1) of the Act in respect of the supply of the complex to the corporation calculated at the rate of 7%.
Marginal note:1993, c. 27, s. 112(3); 1997, c. 10, s. 224(2)(F)
27. (1) The portion of subsection 256(2) of the Act after subparagraph (d)(ii) is replaced by the following:
the Minister shall, subject to subsection (3), pay a rebate to the particular individual equal to the amount determined by the formula
A × ($450,000 - B)/$100,000
where
- A
- is the lesser of 36% of the total tax paid by the particular individual before an application for the rebate is filed with the Minister in accordance with subsection (3), and
(i) if all or substantially all of that tax was paid at the rate of 6%, $7,560, and
(ii) in any other case, the lesser of $8,750 and the amount determined by the formula
(C × $1,260) + $7,560
where
- C
- is the extent (expressed as a percentage) to which that tax was paid at the rate of 7%, and
- B
- is the greater of $350,000 and the fair market value of the complex referred to in paragraph (b).
(2) Subsection (1) applies to any rebate in respect of a residential complex for which an application is filed with the Minister of National Revenue on or after July 1, 2006.
Marginal note:2001, c. 15, s. 16(1)
28. (1) The portion of the description of A in subsection 256.2(3) of the Act before the formula is replaced by the following:
- A
- is the lesser of $7,560 and the amount determined by the formula
Marginal note:2001, c. 15, s. 16(1)
(2) The portion of the description of A in subsection 256.2(4) of the Act before the formula is replaced by the following:
- A
- is the lesser of $7,560 and the amount determined by the formula
Marginal note:2001, c. 15, s. 16(1)
(3) The portion of the description of A in subsection 256.2(5) of the Act before the formula is replaced by the following:
- A
- is the lesser of $7,560 and the amount determined by the formula
(4) Subsection (1) applies to
(a) a taxable supply to a recipient from another person of a residential complex or an interest in a residential complex, in respect of which ownership and possession under the agreement for the supply are transferred on or after July 1, 2006, unless the agreement for the supply is evidenced in writing and was entered into on or before May 2, 2006; and
(b) a deemed purchase (within the meaning of subparagraph 256.2(3)(a)(ii) of the Act) by a builder if the tax in respect of the deemed purchase of a complex or an addition to a complex is deemed to have been paid on or after July 1, 2006.
(5) Subsection (2) applies to a supply of a building or part of it forming part of a residential complex and a supply of land, described in subparagraphs 256.2(4)(a)(i) and (ii) of the Act, that result in a person being deemed under section 191 of the Act to have made and received a taxable supply by way of sale of the complex or of an addition to it on or after July 1, 2006, unless the supply is deemed to have been made as a consequence of the builder giving possession of a residential unit in the complex or the addition to a person under an agreement for the supply by way of sale of the building or part of it forming part of the complex or the addition and
(a) the agreement was entered into on or before May 2, 2006; or
(b) another agreement was entered into on or before May 2, 2006, by the builder and another person and that other agreement was not terminated before July 1, 2006, and was for the supply by way of sale of the building or part of it forming part of
(i) in the case of a deemed supply of a complex, the complex, or
(ii) in the case of a deemed supply of an addition, the addition.
(6) Subsection (3) applies to
(a) a taxable supply by way of sale to a recipient from another person of a residential complex, or an interest in a residential complex, in respect of which ownership and possession under the agreement for the supply are transferred on or after July 1, 2006, unless the agreement is evidenced in writing and was entered into on or before May 2, 2006; and
(b) a deemed purchase (within the meaning of subparagraph 256.2(5)(a)(ii) of the Act) by a builder if the tax in respect of the deemed purchase of a complex or an addition to a complex is deemed to have been paid on or after July 1, 2006.
29. (1) The Act is amended by adding the following after section 256.2:
Marginal note:Transitional rebate
256.3 (1) If a particular person, other than a cooperative housing corporation,
(a) pursuant to an agreement of purchase and sale, evidenced in writing, entered into on or before May 2, 2006, is the recipient of a taxable supply by way of sale from another person of a residential complex in respect of which ownership and possession under the agreement are transferred to the particular person on or after July 1, 2006,
(b) has paid all of the tax under subsection 165(1) in respect of the supply calculated at the rate of 7%, and
(c) is not entitled to claim an input tax credit or a rebate, other than a rebate under this subsection, in respect of the tax referred to in paragraph (b),
the Minister shall, subject to subsection (7), pay a rebate to the particular person equal to 1% of the value of the consideration for the supply.
Marginal note:Transitional rebate
(2) If a particular person, other than a cooperative housing corporation,
(a) pursuant to an agreement of purchase and sale, evidenced in writing, entered into on or before May 2, 2006, is the recipient of a taxable supply by way of sale from another person of a residential complex in respect of which ownership and possession under the agreement are transferred to the particular person on or after July 1, 2006,
(b) has paid all of the tax under subsection 165(1) in respect of the supply calculated at the rate of 7%, and
(c) is entitled to claim a rebate under subsection 256.2(3) in respect of any residential unit situated in the complex,
the Minister shall, subject to subsection (7), pay a rebate to the particular person equal to the amount determined by the formula
A × [0.01 - ((B/A)/7)]
where
- A
- is the consideration payable for the supply to the particular person of the complex, and
- B
- is the amount of the rebate under subsection 256.2(3) that the particular person is entitled to claim in respect of the complex.
Marginal note:Transitional rebate
(3) If a particular person, other than a cooperative housing corporation,
(a) pursuant to an agreement of purchase and sale, evidenced in writing, entered into on or before May 2, 2006, is the recipient of a taxable supply by way of sale from another person of a residential complex in respect of which ownership and possession under the agreement are transferred to the particular person on or after July 1, 2006,
(b) has paid all of the tax under subsection 165(1) in respect of the supply calculated at the rate of 7%, and
(c) is entitled to claim a rebate under section 259 in respect of the tax referred to in paragraph (b) and is not entitled to claim any input tax credit or any other rebate, other than a rebate under this subsection, in respect of that tax,
the Minister shall, subject to subsection (7), pay a rebate to the particular person equal to the amount determined by the formula
A × [0.01 - ((B/A)/7)]
where
- A
- is the consideration payable for the supply to the particular person of the complex, and
- B
- is
(i) in the case where the complex is situated in a participating province, the amount of the rebate under section 259 that the particular person would have been entitled to claim if no tax under subsection 165(2) would have been payable or paid in respect of the complex, and
(ii) in any other case, the amount of the rebate under section 259 that the particular person is entitled to claim in respect of the complex.
Marginal note:Transitional rebate
(4) If a cooperative housing corporation
(a) pursuant to an agreement of purchase and sale, evidenced in writing, entered into on or before May 2, 2006, is the recipient of a taxable supply by way of sale from another person of a residential complex in respect of which ownership and possession under the agreement are transferred to the corporation on or after July 1, 2006,
(b) has paid all of the tax under subsection 165(1) in respect of the supply calculated at the rate of 7%, and
(c) is not entitled to claim an input tax credit or a rebate, other than a rebate under this subsection or under section 256.2 or 259, in respect of the tax referred to in paragraph (b),
the Minister shall, subject to subsection (7), pay a rebate to the corporation equal to the amount determined by the formula
A × [0.01 - ((B/A)/7)]
where
- A
- is the consideration payable for the supply, and
- B
- is
(i) if the corporation is entitled to claim a rebate under section 259 in respect of the complex,
(A) in the case where the complex is situated in a participating province, the amount of the rebate under section 259 that the corporation would have been entitled to claim if no tax under subsection 165(2) would have been payable or paid in respect of the complex, and
(B) in any other case, the amount of the rebate under section 259 that the corporation is entitled to claim in respect of the complex,
(ii) 36% of the tax paid under subsection 165(1) by the corporation in respect of the supply if the corporation is not entitled to claim a rebate under section 259 in respect of the complex, and
(A) the corporation is entitled to, or can reasonably expect to be entitled to, claim a rebate under section 256.2 in respect of any residential unit situated in the complex, or
(B) it is the case that, or it can reasonably be expected that, a share of the capital stock of the corporation is or will be sold to an individual for the purpose of using a residential unit in the complex as the primary place of residence of the individual, or of a relation (as defined in subsection 255(1)) of the individual, and that the individual is or will be entitled to claim a rebate under section 255 in respect of the share, and
(iii) in any other case, zero.
Marginal note:Transitional rebate
(5) If a particular individual
(a) pursuant to an agreement of purchase and sale, evidenced in writing, entered into on or before May 2, 2006, is the recipient of a taxable supply by way of sale from another person of a residential complex in respect of which ownership and possession under the agreement are transferred to the particular individual on or after July 1, 2006,
(b) has paid all of the tax under subsection 165(1) in respect of the supply calculated at the rate of 7%, and
(c) is entitled to claim a rebate under subsection 254(2) in respect of the complex,
the Minister shall, subject to subsection (7), pay a rebate to the particular individual equal to the amount determined by the formula
A × [0.01 - ((B/A)/7)]
where
- A
- is the total of all amounts, each of which is the consideration payable for the supply to the particular individual of the complex or for any other taxable supply to the particular individual of an interest in the complex in respect of which the particular individual has paid tax under subsection 165(1) calculated at the rate of 7%, and
- B
- is the amount of the rebate under subsection 254(2) that the particular individual is entitled to claim in respect of the complex.
Marginal note:Group of individuals
(6) If a supply of a residential complex is made to two or more individuals, the references in subsection (5) to a particular individual shall be read as references to all of those individuals as a group, but only the particular individual that applied for the rebate under section 254 may apply for the rebate under subsection (5).
Marginal note:Application for rebate
(7) A rebate under this section in respect of a residential complex shall not be paid to a person, unless the person files an application for the rebate within two years after the day on which ownership of the complex is transferred to the person.
Marginal note:Transitional rebate where section 254.1 applies
256.4 (1) If
(a) under an agreement, evidenced in writing, entered into on or before May 2, 2006, between a particular person and a builder of a residential complex that is a single unit residential complex or a residential condo- minium unit, the particular person is the recipient of
(i) an exempt supply by way of lease of the land forming part of the complex or an exempt supply of such a lease by way of assignment, and
(ii) an exempt supply by way of sale of the building or part of it in which the residential unit forming part of the complex is situated,
(b) possession of the complex is given to the particular person under the agreement on or after July 1, 2006,
(c) the builder is deemed under subsection 191(1) to have made and received a supply of the complex as a consequence of giving possession of the complex to the particular person under the agreement and to have paid tax under subsection 165(1) in respect of the supply calculated at the rate of 7%, and
(d) the particular person is entitled to claim a rebate under subsection 254.1(2) in respect of the complex,
the Minister shall, subject to subsection (4),
(e) pay a rebate to the particular person equal to the amount determined by the formula
A × [0.01 - ((B/A)/7)]
where
- A
- is the amount determined by the formula
C × (100/D)
where
- C
- is the total of all amounts, each of which is the consideration payable by the particular person to the builder for the supply by way of sale to the particular person of the building or part of the building referred to in subparagraph (a)(ii) or of any other structure that forms part of the complex, other than consideration that can reasonably be regarded as rent for the supplies of the land attributable to the complex or as consideration for the supply of an option to purchase that land, and
- D
- is
(i) if the complex is situated in a participating province, 115, and
(ii) in any other case, 107, and
- B
- is the amount of the rebate under subsection 254.1(2) that the particular person is entitled to claim in respect of the complex, and
(f) if the builder is not entitled to claim an input tax credit or a rebate, other than a rebate under this subsection or under subsection 256.2(4), in respect of the tax referred to in paragraph (c), pay a rebate to the builder equal to the amount determined by the formula
(E - F) × [0.01 - ((G/(E - F))/7)]
where
- E
- is the fair market value of the complex at the time that the builder is deemed to have made the supply referred to in paragraph (c),
- F
- is the amount determined for A under paragraph (e), and
- G
- is the amount of the rebate, if any, that the builder is entitled to claim under subsection 256.2(4).
Marginal note:Transitional rebate where section 254.1 does not apply
(2) If
(a) under an agreement, evidenced in writing, entered into on or before May 2, 2006, between a particular person and a builder of a residential complex that is a single unit residential complex or a residential condo- minium unit, the particular person is the recipient of
(i) an exempt supply by way of lease of the land forming part of the complex or an exempt supply of such a lease by way of assignment, and
(ii) an exempt supply by way of sale of the building or part of it in which the residential unit forming part of the complex is situated,
(b) possession of the complex is given to the particular person under the agreement on or after July 1, 2006,
(c) the builder is deemed under subsection 191(1) to have made and received a supply of the complex as a consequence of giving possession of the complex to the particular person under the agreement and to have paid tax under subsection 165(1) in respect of the supply calculated at the rate of 7%, and
(d) the particular person is not entitled to claim a rebate under subsection 254.1(2) in respect of the complex,
the Minister shall, subject to subsection (4),
(e) pay a rebate to the particular person equal to the amount determined by the formula
A/B
where
- A
- is the total of all amounts, each of which is the consideration payable by the particular person to the builder for the supply by way of sale to the particular person of the building or part of the building referred to in subparagraph (a)(ii) or of any other structure that forms part of the complex, other than consideration that can reasonably be regarded as rent for the supplies of the land attributable to the complex or as consideration for the supply of an option to purchase that land, and
- B
- is
(i) if the complex is situated in a participating province, 115, and
(ii) in any other case, 107, and
(f) if the builder is not entitled to claim an input tax credit or a rebate, other than a rebate under this subsection, in respect of the tax referred to in paragraph (c), pay a rebate to the builder equal to the amount determined by the formula
0.01 × [C - (D × (100 / E))]
where
- C
- is the fair market value of the complex at the time the builder is deemed to have made the supply referred to in paragraph (c),
- D
- is the total of all amounts, each of which is the consideration payable by the particular person to the builder for the supply by way of sale to the particular person of the building or part of the building referred to in subparagraph (a)(ii) or of any other structure that forms part of the complex, other than consideration that can reasonably be regarded as rent for the supplies of the land attributable to the complex or as consideration for the supply of an option to purchase that land, and
- E
- is
(i) if the complex is situated in a participating province, 115, and
(ii) in any other case, 107.
Marginal note:Group of individuals
(3) If the supplies described in subsection (1) or (2) are made to two or more individuals, the references in that subsection to a particular person shall be read as references to all of those individuals as a group, but, in the case of a rebate where paragraph (1)(e) applies, only the individual that applied for the rebate under section 254.1 may apply for the rebate under subsection (1).
Marginal note:Application for rebate
(4) A rebate under this section in respect of a residential complex shall not be paid to a person, unless the person files an application for the rebate within two years after
(a) in the case of a rebate to a person other than the builder of the complex, the day on which possession of the complex is transferred to the person, and
(b) in the case of a rebate to the builder of the complex, the end of the month in which the tax referred to in paragraph (1)(c) or (2)(c) is deemed to have been paid by the builder.
Marginal note:Transitional rebate for purchaser
256.5 (1) Where
(a) under an agreement, evidenced in writing, entered into between a particular person and a builder of a residential complex, other than a single unit residential complex or a residential condominium unit, or an addition to it, the particular person is the recipient of
(i) an exempt supply by way of lease of the land forming part of the complex or an exempt supply of such a lease by way of assignment, and
(ii) an exempt supply by way of sale of the building or part of it in which a residential unit forming part of the complex or the addition is situated,
(b) possession of a residential unit forming part of the complex or the addition is given to the particular person under the agreement on or after July 1, 2006,
(c) the builder is deemed under subsection 191(3) or (4) to have made and received a supply of the complex or the addition as a consequence of giving possession
(i) of the residential unit to the particular person under the agreement, or
(ii) of a residential unit forming part of the complex or the addition to another person under an agreement described in paragraph (a) entered into between the other person and the builder,
(d) the builder is deemed to have paid tax under subsection 165(1) in respect of the supply calculated at the rate of 7%, and
(e) if the builder is deemed to have paid the tax referred to in paragraph (d) on or after July 1, 2006, it is the case that the builder and
(i) the particular person entered into the agreement on or before May 2, 2006, or
(ii) a person, other than the particular person, on or before May 2, 2006, entered into an agreement described in paragraph (a) in respect of a residential unit situated in the residential complex or in the addition that the builder is deemed to have supplied (as described in paragraph (c)) and that agreement was not terminated before July 1, 2006,
the Minister shall, subject to subsection (3),
(f) if the particular person is entitled to claim a rebate under subsection 254.1(2) in respect of the complex, pay a rebate to the particular person equal to the amount determined by the formula
A × [0.01 - ((B/A)/7)]
where
- A
- is the amount determined by the formula
C × (100/D)
where
- C
- is the total of all amounts, each of which is the consideration payable by the particular person to the builder for the supply by way of sale to the particular person of the building or part of the building referred to in subparagraph (a)(ii) or of any other structure that forms part of the complex or the addition, other than consideration that can reasonably be regarded as rent for the supplies of the land attributable to the complex or as consideration for the supply of an option to purchase that land, and
- D
- is
(i) if the complex is situated in a participating province, 115, and
(ii) in any other case, 107, and
- B
- is the amount of the rebate under subsection 254.1 that the particular person is entitled to claim in respect of the complex, and
(g) if the particular person is not entitled to claim a rebate under subsection 254.1(2) in respect of the complex, pay a rebate to the particular person equal to the amount determined by the formula
E/F
where
- E
- is the total of all amounts, each of which is the consideration payable by the particular person to the builder for the supply by way of sale to the particular person of the building or part of a building referred to in subparagraph (a)(ii) or of any other structure that forms part of the complex or the addition, other than consideration that can reasonably be regarded as rent for the supplies of the land attributable to the complex or as consideration for the supply of an option to purchase that land, and
- F
- is
(i) if the complex is situated in a participating province, 115, and
(ii) in any other case, 107.
Marginal note:Group of individuals
(2) If the supplies described in subsection (1) are made to two or more individuals, the references in that subsection to a particular person shall be read as references to all of those individuals as a group, but, in the case of a rebate under paragraph (1)(f), only the individual that applied for the rebate under section 254.1 may apply for the rebate under that paragraph.
Marginal note:Application for rebate
(3) A rebate under this section in respect of a residential complex shall not be paid to a person, unless the person files an application for the rebate within two years after the day on which possession of the unit referred to in paragraph (1)(b) is transferred to the person.
Marginal note:Transitional rebate for builder
256.6 (1) If
(a) under an agreement, evidenced in writing, entered into between a particular person and a builder of a residential complex, other than a single unit residential complex or a residential condominium unit, or an addition to it the particular person is the recipient of
(i) an exempt supply by way of lease of the land forming part of the complex or a supply of such a lease by way of assignment, and
(ii) an exempt supply by way of sale of the building or part of it in which a residential unit forming part of the complex or the addition is situated,
(b) the builder is deemed under subsection 191(3) or (4) to have made and received on or after July 1, 2006, a supply of the complex or the addition as a consequence of giving possession
(i) of the residential unit to the particular person under the agreement, or
(ii) of a residential unit forming part of the complex or the addition to another person under an agreement described in paragraph (a) entered into between the other person and the builder,
(c) the builder and
(i) the particular person entered into the agreement on or before May 2, 2006, or
(ii) a person, other than the particular person, on or before May 2, 2006, entered into an agreement described in paragraph (a) in respect of a residential unit situated in the residential complex or in the addition that the builder is deemed to have supplied (as described in paragraph (b)) and that agreement was not terminated before July 1, 2006,
(d) the builder is deemed to have paid tax under subsection 165(1) in respect of the supply referred to in paragraph (b) calculated at the rate of 7%, and
(e) the builder is not entitled to claim an input tax credit or a rebate, other than a rebate under this subsection or under subsection 256.2(4), in respect of the tax referred to in paragraph (d),
the Minister shall, subject to subsection (2), pay a rebate to the builder equal to the amount determined by the formula
A × [0.01 - ((B/A)/7)]
where
- A
- is the amount determined by the formula
C - [D × (100/E)]
where
- C
- is the fair market value of the complex at the time the builder is deemed to have made the supply referred to in paragraph (b),
- D
- is
(i) if the builder is deemed to have made a supply of a complex, the total of all amounts, each of which is the consideration payable by a person to the builder for the supply by way of sale to the person of the building or part of it forming part of the complex or of any other structure that forms part of the complex, or
(ii) if the builder is deemed to have made a supply of an addition, the total of all amounts, each of which is the consideration payable by a person to the builder for the supply by way of sale to the person of the building or part of it forming part of the addition or of any other structure that forms part of the addition, and
- E
- is
(i) if the complex is situated in a participating province, 115, and
(ii) in any other case, 107, and
- B
- is the rebate, if any, under subsection 256.2(4) that the builder is entitled to claim in respect of the complex or, if the builder is deemed to have made a supply of an addition, the addition.
Marginal note:Application for rebate
(2) A rebate under this section in respect of a residential complex or an addition to it shall not be paid to a builder, unless the builder files an application for the rebate within two years after the end of the month in which tax referred to in subsection (1) is deemed to have been paid by the builder.
(2) Subsection (1) comes into force, or is deemed to have come into force, on July 1, 2006.
- Date modified: