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XXXXX
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File: 11585-32
XXXXX P. Tang
XXXXX
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This is in reference to your letter concerning the claiming of GST rebates by a public sector body employer on certain pension plan expenses where the plan is administered by a pension committee. We apologize for the delay in replying your letter which was necessitated as a result of a thorough review of this area both within the Department and with officials of the Department of Finance.
We have recently concluded our interpretative policy work in this area.
It is our view that whether a pension committee that is formed to administer a pension plan can qualify as a "person" separate and distinct from the sponsors (the employers) of the plan is a question of fact depending on the terms under which the committee is established. If the committee is a person, it will not be able to claim the GST rebate under section 259 of the Excise Tax Act (the "Act") since it is NOT a "selected public service body, charity or qualifying non-profit organization" as required under that section. Also, the sponsors of the plan will not be able to claim a rebate in respect of any GST paid by the committee for expenses incurred in administering the plan since the sponsors are not charged with the tax in respect of the related property or services.
If the committee is not a person, it will be necessary to determine, based on the facts of each case, who is administering the plan, and who is charged with the non-creditable tax in respect of the expenses relating to the administration of the plan. A sponsor of the plan may qualify for the rebates of a portion of the tax paid on the inputs relating to the administration of the plan provided all the requirements under section 259 of the Act are met.
We trust our comments will be of assistance to you. Should you wish to discuss the issue further, please do not hesitate to contact Duncan Jones at (613) 952-9210 or Phil Tang at (613) 954-1433.
Yours truly,
J. Sitka
A/Director
Financial Institutions Division
GST Rulings and Interpretations Directorate
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