Please note that the following document, although correct at the time of issue, may not represent the current position of the Canada Revenue Agency. / Veuillez prendre note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'Agence du revenu du Canada.
Excise and GST/HST Rulings Directorate
Place de Ville, Tower A, 15th floor
320 Queen Street
Ottawa ON K1A 0L5
[Addressee]
Case Number: 171013
Business Number: […]
Dear [Client]:
Subject: GST/HST RULING
Registration for GST/HST purposes
Thank you for your letter of June 13, 2015, concerning the requirement to be registered for Goods and Services Tax (GST)/Harmonized Sales Tax (HST) purposes. We apologize for the delay in this response.
The HST applies in the participating provinces at the following rates: 13% in Ontario; and 15% in New Brunswick, Newfoundland and Labrador, Nova Scotia and Prince Edward Island. The GST applies in the rest of Canada at the rate of 5%.
All legislative references are to the Excise Tax Act (ETA) unless otherwise specified.
STATEMENT OF FACTS
We understand from your letter and our telephone conversations that:
1. You are a self-employed contractor working with […] ([…][the Company]), based in […][City 1, Province 1].
2. You are not a social worker.
3. You are registered for GST/HST purposes with account number […]
4. In your letter, you described your duties with [the Company] as follows:
“My title as a contractor through [the Company] is […][Client’s job title]. I work with children that have been apprehended from their parent(s), specifically caring for them during their supervised access which is court mandated. I am required to take over care from their Foster Placement or Kinship placement. I then facilitate a supervised visit between the child(ren) and their parent(s). The primary purpose of my role is to ensure the safety, both emotionally and physically, of the child(ren). The timeframe in which I am responsible for caring for the child(ren) is always less than 24 hours, and the point in which my role is complete is when the Foster Placement or Kinship placement take back the role of care provider.”
5. You confirmed that the only service you provide to [the Company] is supervised access as described in bullet #4. You also confirmed that the children who are supervised during the visits are 14 years of age and under.
6. You confirmed that your revenue from [the Company] is your only self-employment revenue.
RULING REQUESTED
You would like to know if you are required to be registered for GST/HST purposes.
RULING GIVEN
Based on the facts set out above, we rule that you cannot be registered for GST/HST purposes.
EXPLANATION
Generally, the ETA requires that a person who “makes a taxable supply in Canada in the course of a commercial activity” be registered for GST/HST purposes unless certain exceptions apply. The definition of “commercial activity” excludes the making of exempt supplies. Therefore, a person whose business only involves making exempt supplies cannot register for GST/HST purposes, subject to certain exceptions that are not applicable in your circumstances.
Exempt supplies
Exempt supplies of property and services are listed in Schedule V. The exempting provision that applies to your supplies of services is section 1 of Part IV of Schedule V. This section exempts a supply of child care services, the primary purpose of which is to provide care and supervision to children 14 years of age or under for periods normally less than 24 hours per day, but not including a supply of a service of supervising an unaccompanied child made by a person in connection with a taxable supply by that person of a passenger transportation service.
The supplies of services described in your letter and reproduced in bullet #4 are exempt under section 1 of Part IV of Schedule V. Since you make only exempt supplies to [the Company] and you have no other self-employment income, you cannot register or be registered for GST/HST purposes.
Should the services you provide change in the future, you may wish to send in another request for information to assist you in determining your obligations under the GST/HST.
Registration in error
If a person is registered in error, whether on the part of the Canada Revenue Agency (CRA) or the person in question, the person’s registration may be cancelled as of the date the person was registered.
To cancel your GST/HST registration, please send us completed Form RC145, Request to Close Business Number Program Accounts. Alternatively, you may request cancellation of your registration by calling the Business Window at 1-800-959-5525 or in writing as long as all necessary information is received.
For more information, please refer to Guide RC4022, General Information for GST/HST Registrants, under the heading “Cancelling your registration”, and GST/HST Memorandum 2.7, Cancellation of Registration, available on the CRA website.
In accordance with the qualifications and guidelines set out in GST/HST Memorandum 1.4, Excise and GST/HST Rulings and Interpretations Service, the CRA is bound by the ruling given in this letter provided that: none of the issues discussed in the ruling are currently under audit, objection, or appeal; no future changes to the ETA, regulations or the CRA’s interpretative policy affect its validity; and all relevant facts and transactions have been fully and accurately disclosed.
If you require clarification with respect to any of the issues discussed in this letter, please call me directly at 613-670-7943. Should you have additional questions on the interpretation and application of GST/HST, please contact a GST/HST Rulings officer at 1-800-959-8287.
Yours truly,
Desneiges Arbour
Charities and Non-profit Organizations Unit
Public Service Bodies and Governments Division
Excise and GST/HST Rulings Directorate
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