24 April 2001 GST/HST Ruling 35458 - Application of the GST/HST to Day Program Services Designed for Adults Who have Limited Physical or Mental Capacity

Dear XXXXX

Thank you for your correspondence of February 5, 2001, and subsequent telephone correspondence concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to the activities of XXXXX[.]

Statement of Facts

Our understanding of the facts is as follows:

1. XXXXX is neither a charity nor a non-profit organization. It is established as a for-profit entity although it is currently operating at a deficit.

2. XXXXX offers a day program that provides services to adults with various disabilities. It provides services to approximately XXXXX individuals per day. Some individuals receive services from XXXXX multiple days each week XXXXX charges XXXXX per hour or XXXXX per day for its services.

3. The services are designed for adults who have a limited physical or mental capacity for self-supervision and self-care due to a disability. Individuals receiving services from XXXXX are not self-sufficient and could not be left alone for any period of time, or only for a very short period of time.

4. Program activities focus on abilities in:

•   mental stimulation;

•   physical recreation;

•   cognitive learning; and/or

•   social interaction.

5. Services are provided at XXXXX establishment and not at the individuals' homes.

Ruling Requested

Are the services provided by XXXXX exempt from GST/HST?

Ruling Given

Based on the facts set out above, we rule that services provided by XXXXX are exempt from GST/HST under section 3 of Part IV of Schedule V to Excise Tax Act.

This ruling is subject to the general limitations and qualifications outlined in section 1.4 of Chapter 1 of the GST/HST Memoranda Series. We are bound by this ruling provided that none of the above issues is currently under audit, objection, or appeal; that there are no relevant changes in the future to the Excise Tax Act, or to our interpretative policy; and that you have fully described all necessary facts and transaction(s) for which you requested a ruling.

Should you have any further questions or require clarification on the above matter, please do not hesitate to contact me at (613) 952-0420.

Yours truly,

Lorrie McAnulty
Charities, NPO's and Governments Unit
Public Service Bodies and Governments Division
Excise and GST/HST Rulings Directorate