Marginal note:Rebates
181.1 Where
(a) a registrant makes a taxable supply in Canada of property or a service (other than a zero-rated supply),
(b) a particular person acquires the property or service, either from the registrant or from another person,
(c) the registrant pays, at any time, a rebate in respect of the property or service to the particular person and therewith provides written indication that a portion of the rebate is an amount on account of tax, and
(d) subsection 232(3) does not apply to the rebate,
the following rules apply:
(e) the registrant may claim an input tax credit for the reporting period of the registrant that includes that time equal to the product obtained when the amount of the rebate is multiplied by the fraction (in this section referred to as the “tax fraction in respect of the rebate”)
A/B
where
- A
- is
(i) if tax under subsection 165(2) was payable in respect of the supply of the property or service to the particular person, the total of the rate set out in subsection 165(1) and the tax rate of the participating province in which that supply was made, and
(ii) in any other case, the rate set out in subsection 165(1), and
- B
- is the total of 100% and the percentage determined for A, and
(f) where the particular person is a registrant who was entitled to claim an input tax credit, or a rebate under Division VI, in respect of the acquisition of the property or service, the particular person shall be deemed, for the purposes of this Part, to have made a taxable supply and to have collected, at that time, tax in respect of the supply equal to the amount determined by the formula
A × (B/C) × D
where
- A
- is the tax fraction in respect of the rebate,
- B
- is the input tax credit or rebate under Division VI that the particular person was entitled to claim in respect of the acquisition of the property or service,
- C
- is the tax payable by the particular person in respect of the acquisition of the property or service, and
- D
- is the amount of the rebate paid to the particular person by the registrant.
- [NOTE: Application provisions are not included in the consolidated text
- see relevant amending Acts and regulations.]
- 1993, c. 27, s. 46
- 1997, c. 10, s. 175
- 2006, c. 4, s. 8
- Date modified: