27 October 2021 GST/HST Ruling 201376 - Public Service Body Rebate Eligibility

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: 201376
Business Number: [...]

Dear [Client]:

Subject: GST/HST RULING
Public Service Body Rebate Eligibility

Thank you for your fax of [mm/dd/yyyy], concerning the eligibility of […](the Centre) to claim an 83% public service body (PSB) rebate of the goods and services tax (GST) and the federal part of the harmonized sales tax (HST), and an 87% PSB rebate of the provincial part of the HST, under section 259 of the Excise Tax Act (ETA) in respect of its activities. We apologize for the delay in our 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 ETA unless otherwise specified.

STATEMENT OF FACTS

Based on your faxes of [mm/dd/yyyy]; and information on the Centre’s website, we understand the facts to be:

1. The Centre is a registered charity within the meaning assigned to that expression by subsection 248(1) of the Income Tax Act and is a charity for purposes of the GST/HST. The Centre has been given BN# [...].

2. The Centre is not registered for GST/HST purposes.

3. As part of its commitment to promote the delivery of public health services by non-profit organizations, the Province of Ontario passed the Local Health System Integration Act, 2006.

On April 1, 2021, the health system planning and funding functions from the Local Health Integration Networks (LHINs) transferred into Ontario Health. LHINs began operating under a new business name, Home and Community Care Support Services, to reflect a focused service delivery mandate. (Footnote 1)

4. […] (Footnote 2)

5. The Centre’s mission is […] (Footnote 3) . […].

6. Health care services at the Centre are provided by […]

7. […]

8. […], the Centre provides the following services and programs (Footnote 4) :

9. […]

10. The Centre has […][an Agreement] with […][the LHIN] for the provision of health care services and programs.

11. The vast majority of the Centre’s operating funding comes from the Minister of Health and Long-Term Care for Ontario (MOHLTC) through [the LHIN]. The year-end [mm/dd/yyyy] financial statements indicate that funds received from [the LHIN] amounted to $[…].

12. […].

13. There is no overnight accommodation or beds provided at any of the Facilities.

14. The Centre currently claims PSB rebates of 50% of the GST and federal part of the HST, and 82% of the provincial part of the HST, as a “charity”.

15. […].

[…] (Footnote 5)

16. [...].

RULINGS REQUESTED

You would like to know if the Centre can recover tax […] at the rate of 83% for the GST and the federal part of the HST and 87% for the provincial part of the HST under section 259.

RULINGS GIVEN

Based on the facts set out above, we rule that:

The Centre is a facility operator making facility supplies at qualifying facilities.

PSB rebate of the GST and the federal part of the HST

As a charity that is also a facility operator, the Centre is entitled to a PSB rebate of the GST and the federal part of the HST as follows:

* A 50% PSB rebate of the non-creditable GST charged (Footnote 6) or the federal non-creditable HST charged in respect of property or a service for the claim period to the extent that the property or service is for consumption, use or supply in activities engaged in by the Centre otherwise than in the course of operating a qualifying facility for use in making facility supplies, or in the course of making facility supplies, ancillary supplies or home medical supplies.

* An 83% PSB rebate of the non-creditable GST charged or the federal non-creditable HST charged in respect of property or a service to the extent that the property or service is for consumption, use or supply in activities engaged in by the Centre in the course of operating the Facilities for use in making facility supplies, or in the course of making facility supplies, ancillary supplies or home medical supplies.

PSB rebate of the provincial part of the HST

As the Centre is resident in Ontario, it is also entitled to a PSB rebate of the provincial part of the HST as follows:

* An 82% PSB rebate of the provincial non-creditable HST charged in respect of property or a service for the claim period to the extent that the property or service is for consumption, use or supply in activities engaged in by the Centre in Ontario otherwise than in the course of operating a qualifying facility for use in making facility supplies, or in the course of making facility supplies, ancillary supplies or home medical supplies.

* An 87% PSB rebate of the provincial non-creditable HST charged in respect of property or service to the extent that the property or service is for consumption, use or supply in activities engaged in by the Centre in Ontario in the course of operating the Facilities for use in making facility supplies, or in the course of making facility supplies, ancillary supplies or home medical supplies.

[…].

EXPLANATION

Provincially recognized and funded non-profit public health care facilities established and operated for the medical or surgical treatment of individuals are generally eligible to claim an 83% PSB rebate of the otherwise unrecoverable GST and federal part of the HST and, when resident in Ontario, 87% of the provincial part of the HST paid on purchases related to certain exempt health care operations. Hereafter these two rebates will be referred to as the “83% (and 87%) PSB rebate”).

As a charity, the Centre is also entitled to claim a 50% PSB rebate of the GST and the federal part of the HST paid or payable on eligible purchases and expenses intended for consumption, use or supply in activities engaged in by the Centre otherwise than in the course of operating a qualifying facility for use in making facility supplies, or in the course of making facility supplies, ancillary supplies or home medical supplies.

As the Centre is resident in Ontario, it is also eligible to claim an 82% PSB rebate of the provincial part of the HST paid or payable on eligible purchases and expenses intended for consumption, use or supply in activities engaged in by the Centre otherwise than in the course of operating a qualifying facility for use in making facility supplies, or in the course of making facility supplies, ancillary supplies or home medical supplies.

You will find our explanation presented in the following manner:

* The first part entitled Status of the Centre as a facility operator provides an explanation as to why the Centre is a facility operator and the activities that are eligible for the 83% (and 87%) PSB rebate;

* The second part entitled Ancillary supplies and home medical supplies provides information on other activities that are eligible for the 83% (and 87%) PSB rebate;

[…]

* The last part entitled Additional information on the calculation of the PSB rebate provides additional information on the calculation of the PSB rebate.

Status of the Centre as a facility operator

To be eligible for the 83% (and 87%) PSB rebate, a PSB must be a “hospital authority”, a “facility operator” or an “external supplier”.

Hospital authority

The Centre does not operate a public hospital and is not designated as a hospital authority, and as such it is not a “hospital authority”.

Therefore, to determine whether there is eligibility for the 83% (and 87%) PSB rebate, it is necessary to determine whether the Centre is a “facility operator” or an “external supplier”.

Facility operator

A “facility operator” is defined in subsection 259(1) as meaning “a charity, a public institution or a qualifying non-profit organization (other than a hospital authority), that operates a qualifying facility”.

As the Centre is a charity, it meets the first requirement of the definition. In order to meet the second requirement, the Centre must operate a “qualifying facility”.

Qualifying facility

Subsection 259(2.1) sets out three criteria that must be met for a facility, or part of a facility, other than a public hospital, to be a qualifying facility, for a fiscal year, or any part of a fiscal year, of the operator of the facility or part.

A facility or part of a facility will be considered a “qualifying facility” if:

(a) supplies of services that are ordinarily rendered during that fiscal year or part to the public at the facility or part would be facility supplies if the references in the definition of “facility supply” in subsection 259(1) to “public hospital or qualifying facility” were references to the facility or part;

(b) an amount, other than a nominal amount, is paid or payable to the operator as qualifying funding in respect of the facility or part for the fiscal year or part; and

(c) an accreditation, licence or other authorization that is recognized or provided for under a law of Canada or a province in respect of facilities for the provision of health care services applies to the facility or part during that fiscal year or part.

The requirements contained in (a) to (c) above must be met in order for a particular facility to be a “qualifying facility” for purposes of section 259. A discussion of these requirements follows.

Facility Supply

Subsection 259(1) defines the term “facility supply” as “an exempt supply (other than a prescribed supply) of property or a service in respect of which

(a) the property is made available, or the service is rendered, to an individual at a public hospital or qualifying facility as part of a medically necessary process of health care for the individual for the purpose of maintaining health, preventing disease, diagnosing or treating an injury, illness or disability or providing palliative health care, which process

(i) is undertaken in whole or in part at the public hospital or qualifying facility,

(ii) is reasonably expected to take place under the active direction or supervision, or with the active involvement, of

(A) a physician acting in the course of the practise of medicine,

(B) a midwife acting in the course of the practise of midwifery,

(C) if a physician is not readily accessible in the geographic area in which the process takes place, a nurse practitioner acting in the course of the practise of a nurse practitioner, or

(D) a prescribed person acting in prescribed circumstances, and

(iii) in the case of chronic care that requires the individual to stay overnight at the public hospital or qualifying facility, (…), and

(b) if the supplier does not operate the public hospital or qualifying facility, an amount, other than a nominal amount, is paid or payable as medical funding to the supplier.”

A “physician” is defined in subsection 259(1) as “a person who is entitled under the laws of a province to practise the profession of medicine”.

As the Centre does not provide chronic care at its facilities that requires an individual to stay overnight, and because the Centre operates its own facilities, subparagraph (a)(iii) and paragraph (b) of the definition of “facility supply” are not relevant here and are not discussed in this letter.

The definition of “facility supply” is to be applied on a supply-by-supply basis. To be a “facility supply”, the property made available or the service rendered to an individual at the qualifying facility must be an exempt supply. As mentioned above, exempt supplies are listed in Schedule V to the ETA.

Section 1 of Part V.1 of Schedule V exempts supplies of property or a service made by a charity unless specifically excluded under paragraphs (a) to (p) of that section. As the Centre is a charity, the supplies it makes to its patients/clients would generally be exempt under section 1 of Part V.1 of Schedule V.

Section 2 of Part II of Schedule V exempts a supply of an institutional health care service made by the operator of a health care facility if the institutional health care service is rendered to a patient or resident of the facility. The terms “institutional health care service” and “health care facility” are defined in section 1 of Part II of Schedule V. This section may also apply to exempt supplies of services that the Centre makes.

Of note, if a supply is of an institutional health care service that falls within section 2 of Part II of Schedule V, it is necessary to determine if the supply is excluded from the exemption because the supply is a cosmetic service supply or because the supply is not a qualifying health care supply, pursuant to sections 1.1 and 1.2 of Part II of Schedule V (Footnote 7) .

Paragraph (a) of the definition of “facility supply” requires that the exempt property be made available, or the exempt service be rendered, to an individual at the qualifying facility. Therefore, only the exempt property made available, or exempt services rendered, by the Centre to patients/clients at its Facilities would meet this requirement. In other words, supplies made outside the qualifying facilities would not be considered facility supplies.

The combination of paragraph (a), subparagraphs (a)(i) and (a)(ii), and clause (a)(ii)(A) of the definition of “facility supply” further requires that the exempt supply of property be made available or the exempt supply of a service be rendered at the qualifying facility and be part of a medically necessary process of health care for the individual for the purpose of maintaining health, preventing disease, diagnosing or treating an injury, illness or disability or providing palliative care. This process must be undertaken in whole or in part at the qualifying facility and reasonably be expected to take place under the active direction or supervision, or with the active involvement, of a physician acting in the course of practise of medicine (or in certain circumstances, a midwife, a nurse practitioner if a physician is not readily accessible in the geographic area or a prescribed person in prescribed circumstances).

In our examination of the programs and activities of the Centre, we conclude that the Centre is making facility supplies at the Facilities in regards to certain programs and activities.

Accordingly, to the extent that supplies of health care services provided at the Facilities are exempt supplies that are part of a medically necessary process of health care for the individual for purposes described in paragraph (a) of the definition of “facility supply” and are rendered at the Facilities under the active direction or supervision, or with the active involvement, of a physician, they will meet the requirements of subparagraphs (a)(i) and (a)(ii) of the definition and will, therefore, constitute “facility supplies”.

[…]

Although subclause (a)(ii)(C) in the subsection 259(1) definition of “facility supply” refers to a nurse practitioner acting in the course of the practise of a nurse practitioner, that circumstance is only considered/applicable when a physician is not readily accessible in the geographic area in which the medically necessary process of health care takes place.

In addition, subclause (a)(ii)(D) of the definition of “facility supply” is not relevant because no regulations have been prescribed.

Qualifying funding

Paragraph (b) of the definition of “qualifying facility” in subsection 259(2.1) requires that an amount, other than a nominal amount, be paid or payable to the operator of the facility as “qualifying funding” in respect of the facility or part.

Subsection 259(1) defines “qualifying funding” of the operator of a facility for all or part of a fiscal year of the operator as meaning “a readily ascertainable amount of money (including a forgivable loan but not including any other loan or a refund, remission or rebate of, or credit in respect of, taxes, duties or fees imposed under any statute) that is paid or payable to the operator in respect of the delivery of health care services to the public for the purpose of financially assisting in operating the facility during the fiscal year or part, as consideration for an exempt supply of making the facility available for use in making facility supplies at the facility during the fiscal year or part or as consideration for facility supplies of property that are made available, or services that are rendered, at the facility during the fiscal year or part and is paid or payable by

(a) a government, or

(b) a person that is a charity, a public institution or a qualifying non-profit organization

(i) one of the purposes of which is organizing or coordinating the delivery of health care services to the public, and

(ii) in respect of which it is reasonable to expect that a government will be the primary source of funding for the activities of the person that are in respect of the delivery of health care services to the public during the fiscal year of the person in which the supply is made”.

Financial assistance provided to the Centre by the MOHLTC (through [the LHIN] for the Facilities) meets the requirements of the definition of “qualifying funding” as the funding provided is a readily ascertainable amount of money paid or payable in respect of the delivery of health care services to the public in the circumstances described above.

Accreditation, licence or other authorization

Paragraph (c) of the definition of “qualifying facility” in subsection 259(2.1) requires that an accreditation, licence or other authorization that is recognized or provided for under a law of Canada or a province in respect of facilities for the provision of health care services applies to the facility or part during that fiscal year or part.

[…]

Ancillary supplies and home medical supplies

A facility operator may also be entitled to claim an 83% rebate of the GST and the federal part of the HST paid or payable on eligible purchases and expenses to the extent that it intended to consume, use or supply the property or service in the course of activities engaged in by the Centre in the course of making “ancillary supplies” or “home medical supplies”. As resident in Ontario, it may also be entitled to claim an 87% rebate of the provincial part of the HST paid or payable on eligible purchases and expenses to the extent that it intended to consume, use or supply the property or service in the course of activities engaged in by the Centre in the course of making ancillary supplies or home medical supplies.

Although there is no clear indication that the Centre is involved in the provision of ancillary supplies or home medical supplies, […]as described below, we offer the following information for your reference.

Ancillary supply

Subsection 259(1) defines the term “ancillary supply” as:

(a) an exempt supply of a service of organizing or coordinating the making of facility supplies or home medical supplies in respect of which supply an amount, other than a nominal amount, is paid or payable to the supplier as medical funding, or

(b) the portion of an exempt supply (other than a facility supply, a home medical supply or a prescribed supply) of property or a service (other than a financial service) that represents the extent to which the property or service is, or is reasonably expected to be, consumed or used for making a facility supply and in respect of which portion an amount, other than a nominal amount, is paid or payable to the supplier as medical funding.

Subsection 259(1) defines “medical funding” of a supplier in respect of a supply to be “an amount of money (including a forgivable loan but not including any other loan or a refund, remission or rebate of, or credit in respect of, taxes, duties or fees imposed under any statute) that is paid or payable to the supplier in respect of health care services for the purpose of financially assisting the supplier in making the supply or as consideration for the supply by

(a) a government, or

(b) a person that is a charity, a public institution or a qualifying non-profit organization

(i) one of the purposes of which is organizing or coordinating the delivery of health care services to the public, and

(ii) in respect of which it is reasonable to expect that a government will be the primary source of funding for the activities of the person that are in respect of the delivery of health care services to the public during the fiscal year of the person in which the supply is made.”

[…]

Home Medical Supply

Subsection 259(1) defines a “home medical supply” to mean “an exempt supply (other than a facility supply or a prescribed supply) of property or a service

(a) that is made
(i) as part of a medically necessary process of health care for an individual for the purpose of maintaining health, preventing disease, diagnosing or treating an injury, illness or disability or providing palliative health care, and

(ii) after a physician acting in the course of the practise of medicine, or a prescribed person acting in prescribed circumstances, has identified or confirmed that it is appropriate for the process to take place at the individual’s place of residence or lodging (other than a public hospital or a qualifying facility),

(b) in respect of which the property is made available, or the service is rendered, to the individual at the individual’s place of residence or lodging (other than a public hospital or a qualifying facility), on the authorization of a person who is responsible for coordinating the process and under circumstances in which it is reasonable to expect that the person will carry out that responsibility in consultation with, or with ongoing reference to instructions for the process given by, a physician acting in the course of the practise of medicine, or a prescribed person acting in prescribed circumstances,

(c) all or substantially all of which is of property or a service other than meals, accommodation, domestic services of an ordinary household nature, assistance with the activities of daily living and social, recreational and other related services to meet the psycho-social needs of the individual, and

(d) in respect of which an amount, other than a nominal amount, is paid or payable as medical funding to the supplier.”

PSB rebate […]

To be eligible to claim the 83% (and 87%) PSB rebate, where the person is a facility operator resident in Ontario, the calculation of the rebate must be done in accordance with the rules provided in section 259 and in the Public Service Body Rebate (GST/HST) Regulations (the Regulations).

A facility operator is eligible to claim the 83% (and 87%) PSB rebate of the non-creditable tax charged in respect of property or services to the extent that the property or services are for consumption, use or supply in activities engaged in by the facility operator in the course of operating a qualifying facility for use in making facility supplies, or in the course of making facility supplies, ancillary supplies and home medical supplies.

As a charity and a facility operator resident in Ontario, the Centre can claim a PSB rebate in respect of property or a service for a claim period as follows:

* If the Centre, acting in its capacity as a facility operator, consumes, uses or supplies the property or service in the course of activities engaged in by the Centre in the course of operating a qualifying facility for use in making facility supplies or of making facility supplies, ancillary supplies or home medical supplies:

* An 83% rebate of the non-creditable GST charged or the federal non-creditable HST charged in respect of the property of service multiplied by the extent (expressed as a percentage) to which the Centre intended, at the relevant time (Footnote 8) , to consume, use or supply the property or service in the course of activities engaged in by the Centre in the course of operating a qualifying facility for use in making facility supplies or of making facility supplies, ancillary supplies or home medical supplies.

* An 87% rebate of the provincial non-creditable HST charged in respect of the property or service multiplied by the extent (expressed as a percentage) to which the Centre intended, at the relevant time, to consume, use or supply the property or service in the course of activities engaged in by the Centre in the course of operating a qualifying facility in Ontario for use in making facility supplies or of making facility supplies, ancillary supplies or home medical supplies in Ontario.

* In any other case:

		* A 50% rebate of the non-creditable GST charged or the federal non-creditable HST charged in respect of the property or service to the extent that the Centre intended to consume, use, or supply property or services in the course of its non-selected public service body activities (Footnote 9) .

		* An 82% rebate of the provincial non-creditable HST charged in respect of the property or service to the extent that the Centre intended to consume, use, or supply property or services in the course of its non-selected public service body activities in Ontario.

[…]

Additional information on the calculation of the PSB rebate

Calculation of the PSB rebate

Section 259 provides that a PSB rebate is calculated and claimed on a claim period by claim period basis. A PSB that is not a GST/HST registrant has two claim periods per fiscal year – the first six months and the last six months of its fiscal year.

Pursuant to subsection 259(14), where all or substantially all (90% or more) of the non-creditable tax charged in respect of property or a service for a claim period is tax incurred in its capacity as a facility operator, the Centre will be entitled to claim an 83% (and 87%) PSB rebate on all of the non-creditable tax charged in respect of the property or service for that claim period. In other words, where the Centre incurs 90% or more of the GST/HST paid or payable on a property or a service for a claim period in its capacity as a facility operator (e.g., for use in making facility supplies), all of the GST/HST charged in respect of the property or service for that claim period is deemed to have been incurred in that capacity. As such, the Centre could claim an 83% (and 87%) PSB rebate on all of the non-creditable tax charged in respect of the property or service for that claim period. For example, if the Centre incurs GST/HST on its utilities in a claim period, and 93% of the use of the utilities is for activities in its capacity of operating a qualifying facility for use in making facility supplies, the Centre may claim the PSB rebate for all of the GST/HST it pays on the utilities using the 83% (and 87%) PSB rebate rate.

If less than 90% of non-creditable tax charged in a claim period is for these purposes, then the Centre is entitled to claim an 83% (and 87%) PSB rebate to the extent the property or service is for activities engaged in by the Centre in the course of operating a qualifying facility for use in making facility supplies, or in the course of making of facility supplies, ancillary supplies or home medical supplies.

PSB rebates from previous periods

The Centre may find that it has GST/HST that was paid or payable but has not been claimed in a rebate or that it has claimed rebates in respect of certain activities at an incorrect rate. The requirements for claiming such additional rebate amounts are not the same and are described in detail below.

Where a person has made an application for a PSB rebate for a particular claim period and later discovers additional GST/HST that was paid or payable in that claim period but was not claimed, subsection 259(6.1) may apply. Where certain conditions are met, subsection 259(6.1) allows a PSB to claim a rebate in respect of property or a service for a particular claim period in a rebate application for a subsequent claim period ending after September 8, 2017. If a PSB has not claimed a rebate in respect of property or a service for a particular claim period, subsection 259(6.1) allows the rebate to be carried forward where the following four conditions are met:

* The PSB did not claim the rebate in the application for any other claim period;

* The application for the subsequent claim period is filed within two years after

		* if the person is a registrant, the day on or before which the person is required to file its GST/HST return for the particular claim period, and
		* if the person is not a registrant, the day that is three months after the last day of the particular claim period;

* The PSB did not change the claimant type under which it was eligible to claim PSB rebates at any time from the beginning of the claim period in which the GST/HST was paid or payable to the end of the subsequent claim period; and

* The applicable rebate factor(s) did not change at any time from the beginning of the claim period in which the GST/HST was paid or payable to the end of the subsequent claim period.

Subsection 259(6.1) does not apply in situations where a person has claimed a PSB rebate in respect of a property or service and later finds out that it was eligible to claim the rebate at a higher rate. If the Centre has already claimed a PSB rebate for a claim period and subsequently discovers that the rebate was not claimed at the proper rate, the Centre must adjust the previously filed rebate application to claim a PSB rebate at the higher rate. The Centre cannot include the additional rebate amount in the PSB rebate application for a different claim period. For more information on how to adjust a previously filed rebate claim, see “How do you make changes to a rebate application you already filed?” in GST/HST Guide RC4034, GST/HST Public Service Bodies' Rebate. A reassessment or additional assessment of a rebate claim shall not normally be made more than four years after the day the application for the rebate was filed.

For more information on the calculation of the rebate in general, please refer to the same GST/HST Guide RC4034.

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 rulings given in this letter provided that: none of the issues discussed in the rulings 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. The additional information given in this letter is not a ruling and does not bind the CRA with respect to a particular situation. Future changes to the ETA, regulations, or the CRA's interpretative policy could affect the additional information provided herein.

If you require clarification with respect to any of the issues discussed in this letter, please call me directly at 306-807-5296. 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,

John Ware
Health Care Sectors Unit
Public Service Bodies and Governments Division
Excise and GST/HST Rulings Directorate

FOOTNOTES

1 https://health.gov.on.ca/en/common/system/services/lhin/facts.aspx

2 […]

3 […]

4 […]

5 […]

6 In general terms, “non-creditable tax charged” means the GST/HST paid or payable on property or services for which the Centre cannot claim an input tax credit, rebate, refund or remission other than a PSB rebate.

7 Sections 1.1 and 1.2 of Part II of Schedule V

A supply that is a cosmetic service supply or a supply in respect of a cosmetic service supply, that is not made for medical or reconstructive purposes is generally deemed under section 1.1 of Part II of Schedule V not to be included in Part II of Schedule V and is therefore not exempt under section 2 of Part II of Schedule V. A cosmetic service supply is defined in section 1 of Part II of Schedule V to mean "a supply of property or a service that is made for cosmetic purposes and not for medical or reconstructive purposes."

In addition, section 1.2 of Part II of Schedule V provides that for the purposes of Part II of Schedule V, other than sections 9 and 11 to 14, a supply that is not a "qualifying health care supply" is deemed not to be included in Part II of that Schedule. Generally, supplies deemed not to be included in Part II of Schedule V would be taxable at the applicable rate of GST/HST (if made by a registrant), unless the supplies are exempted pursuant to another provision.

The expression "qualifying health care supply" is defined in section 1 of Part II of Schedule V to mean, "a supply of property or a service that is made for the purpose of

(a) maintaining health,

(b) preventing disease,

(c) treating, relieving or remediating an injury, illness, disorder or disability,

(d) assisting (other than financially) an individual in coping with an injury,
illness, disorder or disability, or

(e) providing palliative health care."

For more information on the expression “qualifying health care supply”, please refer to GST/HST Notice 286, Draft GST/HST Policy Statement – Qualifying Health Care Supplies and the Application of Section 1.2 of Part II of Schedule V to the Excise Tax Act to the Supply of Medical Examinations, Reports and Certificates.

8 Generally, the relevant time will be the time the supply was made to, or the property was imported, or brought into a participating province by the person.

9 Non-selected public service body activities are activities other than:

A. in the case of a person designated to be a municipality, those activities for which a person was designated as a municipality

B. activities carried out in the course of:

* in the case of a person determined to be a municipality, fulfilling responsibilities as a local authority

* in the case of a person acting in its capacity as a hospital authority, operating a public hospital, making facility supplies, ancillary supplies, or home medical supplies or operating a qualifying facility to make facility supplies

* in the case of a person acting in its capacity as a facility operator, making facility supplies, ancillary supplies, or home medical supplies or operating a qualifying facility to make facility supplies

* in the case of a person acting in its capacity as an external supplier, making facility supplies, ancillary supplies, or home medical supplies

* in the case of a person acting in its capacity as a school authority, public college, or university, operating an elementary or a secondary school, a post-secondary college or technical institute, a recognized degree-granting institution or a college affiliated with, or research body of, such a degree-granting institution