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, 11th floor
320 Queen Street
Ottawa ON K1A 0L5
[Addressee]
Case Number: 183644
Business Number: […]
Dear [Client]:
Subject: GST/HST RULING
[…] child care services
Thank you for your letter of April 5, 2017, concerning the application of the goods and services tax/harmonized sales tax (GST/HST) to the […] summer day camps and afterschool programs. We apologize for our delay in responding.
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
1. […](the Corporation) is registered for GST/HST purposes with account number […].
2. The Corporation is located in […], Ontario.
3. The Corporation carries on two types of activities
- Martial arts training; and
- Summer day camps and after-school programs […][the children’s programs].
4. Both the martial arts training and the [children’s programs] are held at the Corporation’s martial arts centre.
5. The Corporation offers martial arts classes in the evenings to people of all ages and skill levels.
6. The [children’s programs] are separate from the martial arts training. The children attending the after-school program or the summer day camps are not eligible to attend the martial arts evening classes unless they are also a registered member of the martial arts school.
7. The [children’s programs] are offered to children under 14 years of age (before high school).
Summer day camps
8. The Corporation, […], provides weekly summer day camps […][in July and August].
9. The summer camp hours are from 7:30 a.m. to 6:00 p.m. daily. The Corporation offers early drop-off beginning at 6:30 a.m. The day is broken up by free time and fun, organized activities. There is a snack time at 10:30 a.m. and 2:30 a.m., and lunch is at 12:00 p.m.
10. The Corporation offers various camp options each week, including […][Description of camp options]
11. The weekly schedule for each camp is as follows: […][Description of camp schedule]
After-school program
12. The Corporation, […], provides an after-school program during the school year.
13. The children are picked up from their schools in buses owned by the Corporation.
14. According to the […][children’s programs’] website, the base after-school program includes:
- Arts and crafts;
- Sports activities;
- Homework assistance;
- […][Description of after-school program activities]
15. The general schedule for the after-school program is:
- Snack;
- Homework, with assistance provided if needed;
- Daily activity beginning at 4:30 ([…][Types of activities]);
- Free-time, arts and crafts, etc.;
- Parents pick up their children by 6:00 p.m.
16. The Corporation offers a choice of various daily activities to participants in the after-school program, such as […]. The activities are not mandatory and the participants can choose a different activity each day. The purpose of the daily activities is to occupy and engage the children. In a phone conversation on [mm/dd/yyyy], you explained that the parents fill out a form indicating their child’s choice of activity for each day.
17. According to the [children’s programs] website, the Corporation offers the following add-on packages to participants in the after-school program: […]
RULING REQUESTED
You would like to know whether the [children’s programs] are subject to GST/HST.
RULING GIVEN
Based on the facts set out above, we rule that
1. A supply of services made under the […] summer day camp program is exempt from GST/HST.
2. A supply of services made under the […] after-school program is exempt from GST/HST.
EXPLANATION
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, is exempt from GST/HST. This exemption does not apply to 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 Corporation provides child care services under the [children’s programs]. Although the [children’s programs] are enriched by recreational and athletic activities, such as […], the primary purpose of the programs is to provide care and supervision to children 14 years of age and under. Therefore, the Corporation’s supplies made under the […] summer day camps and after-school programs are exempt from GST/HST.
In accordance with the qualifications and guidelines set out in GST/HST Memorandum 1.4, Excise and GST/HST Rulings and Interpretations Service, the Canada Revenue Agency (CRA) is bound by the ruling(s) given in this letter provided that: none of the issues discussed in the ruling(s) 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 613-670-7942. 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,
Heather Reardon
Charities and Non-Profit Organizations Unit
Public Service Bodies and Governments Division
Excise and GST/HST Rulings Directorate
Email this Content