25 January 1999 GST/HST Interpretation 11695-13 - Statutory Requirements for Returns Required by a Person Who Ceases to be a Registrant

This is in reply to your e-mail concerning the issue of what becomes the due date of a return where a person ceases to be a registrant.

The example provided was where an annual calendar filer ceases to be a registrant effective September 15th.

In the case of a person ceasing to be a registrant, subsection 251(2) provides for the deeming of specific reporting periods; the first being the period from the first day of the reporting period to the end of the day before ceasing to be a registrant; the second period beginning with the date on which the person ceased to be a registrant and ending on the last day of the month. The rationale for the creation of two reporting periods being that the person has ceased to be a registrant part way through, in this example the fiscal year, and is unable or unwilling to complete the fiscal year in its entirety as a registrant. In this example, the reporting periods would be January 1st to September 14th and September 15th to September 30th.

In view of the specific provisions contained in subsection 251(2) deeming the reporting periods when ceasing to be a registrant, any other reporting period while a registrant would be overridden. Thus while the registrant may have been an annual or quarterly filer, this would be set aside for the final reporting period when there is a partial period involved and paragraph 238(1)(b) becomes applicable.

By deeming a reporting period to have ended on September 14th the next issue becomes when must the person who was a registrant throughout that period become obligated to file the return? In this regard, you have correctly observed that, paragraph 238(1)(a) requires a registrant to file a return for a period that is a fiscal year within 3 months or in the case of an individual where the conditions are met the due date is June 15th of the following year. In any other case, paragraph 238(1)(b) requires that the return must be filed one month after the end of the reporting period of the registrant.

Since there is not a complete fiscal year or reporting period, paragraph 238(1)(b) applies to the period where the person was a registrant. In applying the word "month" the meaning is taken from subsection 123(1) of the Act. Reference to "month" means the day beginning on the particular event (de-registration) and ending one day before the same numerical date in the following month, except when the following month does not contain the same numerical date, when it will then end on the last day of the following month. Thus where a reporting period ends on September 14th the person would have a due date of October 14th.

For the period September 15th to September 30th subsection 238(2) would apply to the non-registrant if there is net tax to be remitted. The administrative due date in the example would be October 31st. The general reporting provision for a non-registrant can be found in subsection 245(1) which stipulates the reporting period to be a calendar month, subject to the exception of section 251.

In the case of Division IV.I (HST) paragraph 220.09(1)(a) requires a registrant to file a return and pay the tax in accordance with section 238 or in any other case, on or before the last day of the calendar month following when the tax became payable. This would parallel the requirements of Division V (GST provisions - collection and remittance of Division II Tax), also making October 14th, in your example the due date for the period where the person is a registrant.

Should you have any questions or require further information, I can be contacted at (613) 954-7931.

Dave Crawford
General Operations Unit

Attachment.

Incoming e-mails regarding operational problem

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Dave Caron, Manager, General Operations Unit
Rob Coffin, Business Team Policy and Procedures

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