CRA has postponed proceeding with treating orthodontists as making a single exempt supply

At the 2018 CBA Roundtable, Q.5 regarding Brian Hurd, and CRA’s administrative arrangement to allow 35% input tax credits to orthodontal practices, CRA indicated that it would prospectively phase-out that administrative arrangement and that it was preparing a publication discussing input tax credit availability to dentists and orthodontists. This would essentially mean that orthodontists would be treated as making a single exempt supply to each patient and would not generate any ITC for the related costs (e.g., for the orthodontic devices).

Davis Dentistry (under appeal), which effectively applied that administrative practice to the orthodontic practice of a professional corporation even though it (contrary to the stated CRA requirement) did not show an allocation in its invoices between the two supply components, conflicted with Brian Hurd.

CRA now stated that it will wait for the FCA decision in Davis Dentistry “before taking any more steps in regard to the 35% ITC administrative arrangement.”

Neal Armstrong. Summary of 7 April 2022 CBA Roundtable, Q.6 under ETA, Sch. VI, Pt. II, s. 11.1.