19 October 1998 GST/HST Interpretation HQR0001372 - Eligibility for Rebate of Tax Paid in Error

You provided us with a copy of your memorandum to XXXXX Verification and Enforcement Division for our review and based on our verbal comments you subsequently requested and received additional representations from XXXXX which you then provided to us to support the position taken in the initial memorandum. In addition, you provided the following documents related the supplies made by XXXXX[.]

XXXXX

XXXXX

XXXXX

XXXXX

XXXXX

XXXXX

XXXXX

XXXXX

XXXXX

XXXXX

Based on a review of the documents submitted which relate to the supplies made by XXXXX it is our opinion that there are insufficient facts to support the position that XXXXX is considered to pay the consideration on behalf of XXXXX where XXXXX invoices are issued to XXXXX[.] Based on the documentation provided it appears that XXXXX is the recipient of the supplies provided by XXXXX XXXXX and its subsidiaries are the recipients of the supplies provided by XXXXX[.] However, in order to determine whether XXXXX is entitled to a rebate of tax paid in error in respect of the tax it previously self-assessed and remitted pursuant to Division IV, it must first be determined whether XXXXX acquired these supplies for consumption, use or supply exclusively in the course of its commercial activities. This is a question of fact and based on the documentation provided there is insufficient information to determine that XXXXX acquired these supplies for consumption, use or supply exclusively in the course of its commercial activities. The fact that there are several recipients in respect of the supplies provided by XXXXX will make this determination more difficult.

Based on the information contain in your subsequent memorandum (your file XXXXX we understand that you have been advised by a representative of XXXXX that:

•   XXXXX was the management company for the group of credit companies which included XXXXX

•   XXXXX paid the invoices from XXXXX

•   XXXXX paid the invoices from XXXXX and

•   the business practice was that XXXXX paid the majority of expenses and resupplied to XXXXX[.]

The documents which we have reviewed do not support these representations.

The determination and verification of the facts is generally done when a rebate claim is audited. Accordingly, no further action will be taken by us related to this case.

If you require additional information or clarification please contact me at (613) 952-9262.

M. Dawn Weisberg