May 2019 CPA Alberta CRA Roundtable, GST Session – Q.10

Notwithstanding the posted question’s wording, CRA apparently addressed a different question of how to secure an increased NRRPR rebate when CRA is proposing to assess to increase the amount of GST/HST self-assessed under s. 191(3) based on an increased fair market value for the property. CRA responded:

[S]ubsection 296(2.1) only applies to unclaimed rebate amounts and cannot apply in cases where the person has claimed the allowable rebate in an application filed before the day the notice of assessment is sent to the person per paragraph 296(2.1)(b). … Furthermore, the registrant would be precluded from claiming and submitting a new rebate application as only one application per rebate per matter can be made pursuant to subsection 262(2). … The registrant could request a re-assessment or consideration in the course of the audit of the NRRPR to take into account the change in GST/HST payable on the FMV provided the time limitation for assessing the rebate has not expired. However, we should note that there is nothing preventing (again, provided the rebate is not statute barred from re-assessment) the auditor from pulling in the original rebate and making the adjustments to the rebated amount in cases like the one described in this question. As an extension of service and fairness, it would be appropriate for the auditor to do so.

CRA is assessing to increase the amount of GST/HST self-assessed by a builder under ETA s. 191(3) on substantial completion and first occupancy of a rental residential complex. What should be done where there should be a corresponding increase to the amount of the new residential rental property rebate given this higher FMV?

CRA noted that it was not required under s. 296(2.1)(b) to grant the rebate - because this provision did not apply where a rebate application had been filed. Furthermore, the making of a fresh rebate application was prohibited by s. 262(2). However, CRA indicated that, as a matter “of service and fairness, it would be appropriate for the auditor” to adjust the rebate, provided the period was not statute-barred.