Government of Canada / Gouvernement du Canada
Symbol of the Government of Canada

Search

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

Full Document:  

Act current to 2022-09-22 and last amended on 2022-09-01. Previous Versions

PART IXGoods and Services Tax (continued)

DIVISION VCollection and Remittance of Division II Tax (continued)

SUBDIVISION BRemittance of Tax (continued)

Marginal note:Adjustment if invalid use of export certificate

  •  (1) If a registrant has received a supply of property (other than a supply that is included in any provision of Schedule VI other than section 1.1 of Part V of that Schedule) from a supplier to whom the registrant has provided an export certificate (within the meaning of section 221.1) for the purpose of that supply and an authorization of the registrant to use the certificate was not in effect at the time the supply was made or the registrant does not export the property in the circumstances described in paragraphs 1(b) to (d) of that Part, the registrant shall, in determining the net tax for the reporting period of the registrant that includes the earliest day on which tax in respect of the supply became payable or would have become payable if the supply were not a zero-rated supply, add an amount equal to interest at the prescribed rate on the total amount of tax in respect of the supply that was payable or would have been payable if the supply were not a zero-rated supply, computed for the period beginning on that earliest day and ending on the day on or before which the return under section 238 for that reporting period is required to be filed.

  • Marginal note:Adjustment if deemed revocation of export certificate

    (2) If a registrant’s authorization to use an export certificate (within the meaning of section 221.1) is deemed to have been revoked under subsection 221.1(6) effective immediately after the last day of a fiscal year of the registrant, the registrant shall, in determining the net tax for the first reporting period of the registrant following that year, add the amount determined by the formula

    A × B/12

    where

    A
    is the total of
    • (a) the product obtained when the rate set out in subsection 165(1) is multiplied by the total of all amounts each of which is consideration paid or payable by the registrant for a supply made in a non-participating province of an item of inventory acquired by the registrant in the year that is a zero-rated supply only because it is included in section 1.1 of Part V of Schedule VI, other than a supply in respect of which the registrant is required under subsection (1) to add an amount in determining net tax for any reporting period, and

    • (b) the total of all amounts each of which is the product obtained when the consideration paid or payable by the registrant for a supply made in a participating province of an item of inventory acquired by the registrant in the year that is a zero-rated supply only because it is included in section 1.1 of Part V of Schedule VI, other than a supply in respect of which the registrant is required under subsection (1) to add an amount in determining net tax for any reporting period, is multiplied by the total of the rate set out in subsection 165(1) and the tax rate for that participating province, and

    B
    is the prescribed rate of interest that is in effect on the last day of that first reporting period following the year.
  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 2001, c. 15, s. 11
  • 2006, c. 4, s. 142
  • 2009, c. 32, s. 24

Marginal note:Adjustment if invalid use of export distribution centre certificate

  •  (1) If a registrant has received a supply of property (other than a supply that is included in any provision of Schedule VI other than section 1.2 of Part V of that Schedule) from a supplier to whom the registrant has provided an export distribution centre certificate (within the meaning of section 273.1) for the purpose of that supply and an authorization of the registrant to use the certificate was not in effect at the time the supply was made or the property was not acquired by the registrant for use or supply as domestic inventory or as added property (as those expressions are defined in subsection 273.1(1)) in the course of commercial activities of the registrant, the registrant shall, in determining the net tax for the reporting period of the registrant that includes the earliest day on which tax in respect of the supply became payable or would have become payable if the supply were not a zero-rated supply, add an amount equal to interest, at the prescribed rate, on the total amount of tax in respect of the supply that was payable or that would have been payable in respect of the supply if the supply were not a zero-rated supply, computed for the period beginning on that earliest day and ending on the day on or before which the return under section 238 for that reporting period is required to be filed.

  • Marginal note:Adjustment if export distribution centre conditions not met

    (2) If an authorization granted to a registrant under subsection 273.1(7) is in effect at any time in a fiscal year of the registrant and the export revenue percentage of the registrant (as defined in subsection 273.1(1)) for that year is less than 90% or the circumstances described in paragraph 273.1(11)(a) or (b) exist with respect to the year, the registrant shall, in determining the net tax for the first reporting period of the registrant following the year, add the amount determined by the formula

    A × B/12

    where

    A
    is the total of
    • (a) the product obtained when the rate set out in subsection 165(1) is multiplied by the total of all amounts each of which is consideration paid or payable by the registrant for a supply made in a non-participating province of property acquired by the registrant in the year that is a zero-rated supply only because it is included in section 1.2 of Part V of Schedule VI, other than a supply in respect of which the registrant is required under subsection (1) to add an amount in determining net tax for any reporting period,

    • (b) the total of all amounts each of which is the product obtained when the consideration paid or payable by the registrant for a supply made in a participating province of property acquired by the registrant in the year that is a zero-rated supply only because it is included in section 1.2 of Part V of Schedule VI, other than a supply in respect of which the registrant is required under subsection (1) to add an amount in determining net tax for any reporting period, is multiplied by the total of the rate set out in subsection 165(1) and the tax rate for that participating province, and

    • (c) the product obtained when the rate set out in subsection 165(1) is multiplied by the total of all amounts each of which is the value that is or would be, but for subsection 215(2), deemed under subsection 215(1) to be the value, for the purposes of Division III, of a good that was imported by the registrant in the year and in respect of which, by reason only of section 11 of Schedule VII, tax under that Division did not apply, and

    B
    is the prescribed rate of interest that is in effect on the last day of that first reporting period following the year.
  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 2001, c. 15, s. 11
  • 2006, c. 4, s. 143
  • 2009, c. 32, s. 25

Marginal note:Election for residential complex

  •  (1) A person may make an election in respect of a residential complex, or in respect of an addition to a multiple unit residential complex, for a particular reporting period of the person if

    • (a) the person is the builder of the residential complex or addition;

    • (b) the person is deemed under subsection 191(1), (3) or (4) to have made and received, at a particular time that is on or before February 26, 2008, a taxable supply by way of sale of the residential complex or addition and to have paid as a recipient and to have collected as a supplier a particular amount of tax in respect of that supply;

    • (c) the person has not reported an amount as or on account of tax in respect of the taxable supply in the person’s return under this Division for any reporting period the return for which is filed on or before February 26, 2008 or is required under this Division to be filed on or before a day that is on or before February 26, 2008;

    • (d) the person would be entitled to claim a rebate under subsection 256.2(3) in respect of the residential complex or addition that is determined based on the particular amount of tax if

      • (i) section 256.2 were read without reference to subsection (7), and

      • (ii) the amount determined for B in the first formula in subsection 256.2(3) for a qualifying residential unit, as defined in subsection 256.2(1), that forms part of the residential complex or addition were less than $450,000;

    • (e) the person did not supply to another person by way of sale the residential complex or addition on or before February 26, 2008;

    • (f) the particular reporting period ends on or before February 26, 2010;

    • (g) the election is filed in prescribed form containing prescribed information not later than the day on or before which the return under this Division is required to be filed for the particular reporting period; and

    • (h) the person has not made another election under this subsection in respect of the residential complex or addition.

  • Marginal note:Adjustment to net tax

    (2) If a person makes an election under subsection (1) in respect of a residential complex, or in respect of an addition to a multiple unit residential complex, for a reporting period of the person, the person shall, in determining the net tax for that period, add the positive amount or deduct the negative amount determined by the formula

    (A - B) - C

    where

    A
    is the particular amount of tax referred to in paragraph (1)(b);
    B
    is the amount of the rebate that the person would be entitled, if section 256.2 were read without reference to subsection (7), to claim under subsection 256.2(3) in respect of the residential complex or addition that is determined based on the particular amount of tax; and
    C
    is the amount determined by the formula

    C1 - C2

    where

    C1
    is the total of all amounts each of which is an input tax credit of the person
    • (i) that is in respect of property or a service acquired, imported or brought into a participating province before the particular time referred to in paragraph (1)(b) for consumption or use for the purpose of making the supply referred to in that paragraph, and

    • (ii) in respect of which the person satisfies the requirements of subsection 169(4) at the time the election under subsection (1) is filed, and

    C2
    is the total of all amounts each of which is an amount included in the determination of C1, but only to the extent that the amount can reasonably be regarded as an amount that
    • (i) was claimed or included as an input tax credit or deduction in determining the net tax for the reporting period or a preceding reporting period of the person,

    • (ii) has previously been rebated, refunded or remitted to the person, or that the person is entitled to obtain as a rebate, refund or remission, under this or any other Act of Parliament, or

    • (iii) is included in an adjustment, refund or credit for which a credit note referred to in subsection 232(3) has been received by the person or a debit note referred to in that subsection has been issued by the person.

  • Marginal note:Consequences of election

    (3) For the purposes of this Part, if a person makes an election under subsection (1) in respect of a residential complex, or in respect of an addition to a multiple unit residential complex, for a reporting period of the person, the person is deemed

    • (a) to have been deemed to have made and received, at the particular time referred to in paragraph (1)(b), a taxable supply of the residential complex or addition by way of sale and to have paid as a recipient and to have collected as a supplier tax in respect of the supply equal to the particular amount of tax referred to in that paragraph under

      • (i) in the case of a single unit residential complex or a residential condominium unit, subsection 191(1),

      • (ii) in the case of a multiple unit residential complex, subsection 191(3), and

      • (iii) in the case of an addition, subsection 191(4);

    • (b) to have claimed each amount that is included in the determination of C1 in the second formula in subsection (2) as an input tax credit in determining the net tax for the reporting period, but only to the extent that the amount is not included in the determination of C2 in the same formula;

    • (c) to have claimed and received a rebate under subsection 256.2(3), in respect of the complex or addition, equal to the amount determined for B in the first formula in subsection (2); and

    • (d) not to be required to include the particular amount of tax deemed to have been collected under paragraph (a) for the purpose of determining the net tax of the person for the reporting period that includes the particular time, other than for the purpose of including the particular amount in the determination of A in the first formula in subsection (2).

  • Marginal note:Input tax credit

    (4) For the purposes of subsection 225(4), if a person makes an election under subsection (1), any input tax credit of the person in respect of the complex or addition that the person is deemed to have received under paragraph (3)(a) is deemed to be an input tax credit of the person for the reporting period of the person that includes February 26, 2008 and not an input tax credit of the person for any other period.

  • Marginal note:Limitation period if election

    (5) If a person makes an election under subsection (1) in respect of a residential complex, or in respect of an addition to a multiple unit residential complex, section 298 applies to any assessment, reassessment or additional assessment of an amount added to, or deducted from, net tax by the person in respect of the residential complex or addition, but the Minister has until the day that is four years after the day on or before which the election under subsection (1) is required to be filed with the Minister to make any assessment, reassessment or additional assessment for the purpose of taking into account any amount that is, or is required to be, added or subtracted in determining the amount determined under the first formula in subsection (2).

  • Marginal note:Residential complex separate from addition

    (6) For the purposes of this section, if a person is the builder of an addition to a residential complex and is eligible to make an election under subsection (1) in respect of the addition or the remainder of the residential complex, the addition and the remainder of the residential complex are each deemed to be a separate property.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 2008, c. 28, s. 75

Marginal note:First and second variant years

  •  (1) For the purposes of this section, a fiscal year of a network seller in respect of which an approval granted under 178(5) is in effect is

    • (a) the first variant year of the network seller if the network seller

      • (i) fails to meet the condition referred to in paragraph 178(2)(c) in respect of the fiscal year, and

      • (ii) meets the condition referred to in paragraph 178(2)(c) for each fiscal year of the network seller, in respect of which an approval granted under 178(5) is in effect, preceding the fiscal year; and

    • (b) the second variant year of the network seller if

      • (i) the fiscal year is after the first variant year of the network seller,

      • (ii) the network seller fails to meet the condition referred to in paragraph 178(2)(c) in respect of the fiscal year, and

      • (iii) the network seller meets the condition referred to in paragraph 178(2)(c) for each fiscal year (other than the first variant year) of the network seller, in respect of which an approval granted under 178(5) is in effect, preceding the fiscal year.

  • Marginal note:Adjustment by network seller if conditions not met

    (2) Subject to subsections (3) and (4), if a network seller fails to satisfy any condition referred to in paragraphs 178(2)(a) to (c) for a fiscal year of the network seller in respect of which an approval granted under subsection 178(5) is in effect and, at any time during the fiscal year, a network commission would, if this Part were read without reference to subsection 178(7), become payable by the network seller to a sales representative of the network seller as consideration for a taxable supply (other than a zero-rated supply) made in Canada by the sales representative, the network seller shall, in determining the net tax for the first reporting period of the network seller following the fiscal year, add an amount equal to interest, at the prescribed rate, on the total amount of tax that would be payable in respect of the taxable supply if tax were payable in respect of the taxable supply, computed for the period beginning on the earliest day on which consideration for the taxable supply is paid or becomes due and ending on the day on or before which the network seller is required to file a return for the reporting period that includes that earliest day.

  • Marginal note:No adjustment for first variant year

    (3) In determining the net tax for the first reporting period of a network seller following the first variant year of the network seller, the network seller is not required to add an amount in accordance with subsection (2) if

    • (a) the network seller satisfies the conditions referred to in paragraphs 178(2)(a) and (b) for the first variant year and for each fiscal year, in respect of which an approval granted under subsection 178(5) is in effect, preceding the first variant year; and

    • (b) the network seller would meet the condition referred to in paragraph 178(2)(c) for the first variant year if the reference in that paragraph to “all or substantially all” were read as a reference to “at least 80%”.

  • Marginal note:No adjustment for second variant year

    (4) In determining the net tax for the first reporting period of the network seller following the second variant year of the network seller, the network seller is not required to add an amount in accordance with subsection (2) if

    • (a) the network seller satisfies the conditions referred to in paragraphs 178(2)(a) and (b) for the second variant year and for each fiscal year, in respect of which an approval granted under subsection 178(5) is in effect, preceding the second variant year;

    • (b) the network seller would meet the condition referred to in paragraph 178(2)(c) for each of the first variant year and the second variant year if the reference in that paragraph to “all or substantially all” were read as a reference to “at least 80%”; and

    • (c) within 180 days after the beginning of the second variant year, the network seller requests in writing that the Minister revoke the approval.

  • Marginal note:Adjustment by network seller due to notification failure

    (5) If, at any time after an approval granted under subsection 178(5) in respect of a network seller and each of its sales representatives ceases to have effect as a consequence of a revocation under subsection 178(11) or (12), a network commission would, if this Part were read without reference to subsection 178(7), become payable as consideration for a taxable supply (other than a zero-rated supply) made in Canada by a sales representative of the network seller that has not been notified, as required under paragraph 178(13)(b), of the revocation and an amount is not charged or collected as, or on account of, tax in respect of the taxable supply, the network seller shall, in determining the net tax for the particular reporting period of the network seller that includes the earliest day on which consideration for the taxable supply is paid or becomes due, add an amount equal to interest, at the prescribed rate, on the total amount of tax that would be payable in respect of the taxable supply if tax were payable in respect of the taxable supply, computed for the period beginning on that earliest day and ending on the day on or before which the network seller is required to file a return for the particular reporting period.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 2010, c. 12, s. 72
 
Date modified: