File: 11915-7-2(DRM)
Doc: 456
6 & 8/III/V
Dear XXXXX
I refer to the memo of January 27, 1993 from XXXXX to Mr. Don Dawson, concerning the application of GST to supplies of swimming lessons by private, for-profit organizations. We regret the delay in responding to the request.
Facts
1. In her memo, XXXXX indicated that courses offered by swim schools are usually divided into five basic programs:
• Parent and Tot - Orientation to water through various fun activities; one adult must accompany the child in the water for all levels in this program; ages of children enrolled range from 6 to 36 months old.
• Pre-School Program - This is the first time children receive instruction without a parent; ages range from 3 to 5 years.
• Youth Program - Children must be at least 6 years of age to register for "Yellow", the initial level; levels span from yellow to white; the goal is to develop personal safety and swimming goals.
• Lifeguard Training - The goal is to develop skills to prevent loss of life in an aquatic emergency with minimum risk to the rescuer; certification is issued upon successful completion.
• Instructor Training - The goal is to teach candidates the practical and theoretical knowledge needed in teaching learn-to-swim classes and safety supervision; certification is issued upon successful completion.
2. Persons who graduate from the lifeguard training and instructor training programs receive certificates attesting to the competence of individuals to practise or perform the vocation of assistant lifeguard, lifeguard, and aquatic instructor.
3. XXXXX sets rules for the safe operation of public swimming pools. These rules are intended to cover all facets of pool safety, including, operation of the chlorination system, maintenance of emergency telephones, number of lifeguards required to be on duty, etceteras.
4. Subsection XXXXX of XXXXX indicates that the following documents should be considered as lifeguard certificates:
• XXXXX
• a certificate that XXXXX considers equivalent to the certificates mentioned in clauses (a), (b) or (c).
5. Subsection 17(10) of the Regulation indicates that the following should be considered as assistant lifeguard certificates:
• XXXXX
• any of the certificates mentioned in subsection 17(9); or
• a certificate that the XXXXX considers equivalent to a qualification referred to in clauses (a), (b) or (c).
Issue
Is the supply of swimming lessons by private swim schools exempt of GST under section 6 or section 8 of Part III of Schedule V to the ETA?
Response
The exempting provision of section 6 applies where a vocational school provides instruction in respect of courses which lead to or maintain or upgrade a professional or trade accreditation or designation which is recognized by a regulatory body. A regulatory body as defined in section 1 of Part III of Schedule V, is a body that is constituted or empowered by an Act of Parliament or of the legislature of a province to regulate the practice of a profession or trade by setting standards of knowledge and proficiency for practitioners of the profession or trade.
Section 8 exempts a supply, made by a vocational school, of a service of instructing individuals in, or administering examinations in respect of, courses leading to certificates that attest to the competence of individuals to practise or perform a trade or vocation where the document is prescribed by federal or provincial regulation, the supplier is governed by federal or provincial legislation respecting vocational schools, or the supplier is a non-profit organization or a charity.
In order to make use of either section 6 or 8 of Part III, a for-profit private swim school must first meet the definition of "vocational school" in section 1 of Part III of Schedule V to the ETA ,i.e., the school must be established and operated primarily to provide students with correspondence courses or instruction in courses that develop or enhance students' occupational skills. Included as vocational schools are educational institutions that are certified by the Minister of Employment and Immigration for the purposes of subsection 118.5(1) of the Income Tax Act.
Section 6 - Lifeguard Training Programs
We have not been able to identify a regulatory body which establishes the standards or regulates the practices of lifeguards. Therefore, it is our opinion that the supply of a lifeguard training program or an instructor training program provided by private for-profit swim schools do not lead to an accreditation or designation that is recognized by a regulatory body. As a result, swimming courses offered by private swim schools that lead to certification for lifeguards are not exempt by section 6 of Part III of Schedule V.
Section 8 - Lifeguard Training Program
Courses offered in a lifeguard training program may lead to a lifeguard certificate or assistant lifeguard certificate that is referred to XXXXX[.] However, the Regulation does not prescribe the certificates. That is, XXXXX is not empowered to issue the certificates pursuant to the Regulation, and the Regulation does not establish the requirements to be fulfilled in order to obtain the certificate. The Regulation merely lists certificates or other documents issued by other persons that are to be considered as lifeguard certificates or assistant lifeguard certificates for purposes of the Regulation (i.e., the safe operation of public swimming pools). The documents are not prescribed in any other regulation, so are not prescribed by federal or provincial regulation.
Unless the for-profit swimming school is governed by federal or provincial legislation respecting vocational schools (the provincial act which governs vocational schools in XXXXX the lifeguard training program or instructor training program does not qualify as exempt under section 8 of Part III of Schedule V.
Other Programs
The other programs (parent and tot, preschool, and youth) offered by the swimming schools are not exempt under any provision of Part III of Schedule V to the ETA as it is our opinion that they do not lead to a certificate that attest to the competence of an individual to practise a vocation.
If your require any further information concerning this letter, please contact Ms. Joanne Houlahan, Manager, Public Service Bodies, at (613) 954-7945 or Mr. Dwayne Moore, Tax Policy Officer, at (613) 954-4206.
J.A. Venne
Director
Special Sectors
GST Rulings & Interpretations
c.c.: D. Moore
| c.c.: |
R.J. Courneyea, Audit |
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