6 September 2000 GST/HST Interpretation 25829 - Meaning of "Place of Residence" and "Underprivileged Individuals"

Dear XXXXX:

Thank you for your letter of January 13, 2000 concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to your operations.

Interpretation Requested

You are requesting an interpretation of the meaning of "place of residence" and also the interpretation of "underprivileged individuals" for the purpose of the Excise Tax Act ("ETA").

Interpretation Given

Our interpretation of "Place of Residence" is described in Chapter 19, Section 19.2, Residential Real Property of the GST/HST Memorandum Series. As stated in Chapter 19, a place of residence is where an individual stays most of the time. To be considered an individual's place of residence, the place should be used for purposes of habitation or dwelling, but would not normally include an abode of a transient nature, such as a short-term hotel accommodation for example. Another factor of importance is the amount of time the individual intends to stay at a place. It is important that the amount of time an individual plans to stay be considered an appreciable amount of time, irrespective of whether this period of time is definite or indefinite. What is to be considered an appreciable period of time may be satisfied by demonstrating one's intention to use the place as a residence over a period of time. Evidence of personal belongings or furniture could be a good example to determine if this place is considered a place of residence for the time this individual is occupying the place of stay. All factors must be considered in determining whether or not a residential complex, unit or condominium unit is inhabited for the purpose of its occupancy as a place of residence.

Indicators of property, as indicated in Chapter 19, that are not being used for transient purposes are the following:

-    the place in question is the only residence of the individual;

-    the individual who is the occupant owns or leases the premises, as opposed to occupying the premises under a licence (such as a hotel room);

-    does the individual own or lease the premises on a long term basis (at least one year);

-    the place is furnished by the occupant;

-    the individual receives his/her mail at this address;

-    the telephone service provided at this address is under the individual's name;

-    the public services such as electricity, natural gas, city services, school services are billed to the individual at this address; and

-    the individual has taken out an insurance contract for the home and/or its contents.

These are the main factors used by the Canada Customs and Revenue Agency (the "CCRA") to establish an individual's place of residence but, are not exhaustive. In order to determine an individual's place of residence, each scenario must be examined using a case by case analysis. The term "place of residence", as used for GST/HST purposes applies to more than an individual's home address. Long-term care centers, nursing homes, long-term beds in hospitals, long-term health institutions, are also considered places of residence if most or all of the main factors listed above are indicative of being the individual's place of residence.

Our interpretation of the term "underprivileged" according to the intent of the legislation within the ETA refers to individuals who are seen to be in need of assistance and are unable to provide themselves or their dependent with the basic requirements. This includes the inability to furnish any of the following without assistance: food, shelter, clothing, fuel, utilities, household supplies and special personal requirements. Furthermore, an underprivileged person is interpreted as one who is seen as likely to become in need of assistance if services are not provided.

The foregoing comments represent our general views with respect to the subject matter of your letter. Proposed amendments to the ETA, if enacted, could have an effect on the interpretation provided herein. These comments are not rulings and, in accordance with the guidelines set out in section 1.4 of Chapter 1 of the GST/HST Memoranda Series, do not bind the CCRA with respect to a particular situation.

For your convenience, find enclosed a copy of GST/HST Memoranda Series, Section 19.2, Residential Real Property in regards to the definition of "Place of Residence".

Should you have any further questions or require clarification on the above matter, please do not hesitate to contact me at (613) 952-9592.

Yours truly,

Michel Guay
Municipalities and Health Care Services Unit
Public Service Bodies and Governments Division