CRA indicates that the GST/HST for self-supplies of condo units rather than of MURCs was relevant to the conversion of a MURC to condo units

Regarding whether the conversion of a rental apartment building into condo units would be subject to GST/HST in the hands of an owner under the “self-supply” rule in ETA s. 191, CRA indicated that, under the definition of “residential condominium unit,” the building would consist of residential condominium units from the time that there was an intention to convert it into particular bounded spaces comprising such units.

Partly, on this basis, CRA considered that the relevant self-supply rule was that in s. 19(1) applicable to the substantial renovation (or construction) of a residential condominium unit rather than that applicable under s. 191(3) to the substantial renovation (or construction) of a multiple unit residential complex. Thus, the issue would turn on whether there was substantial renovation of the physical space for each proposed condo unit – with CRA reiterating in this regard its longstanding position that to rise to the level of substantial renovation there would need to be a gutting (or more) of each unit at issue.

Neal Armstrong. Summaries of 7 April 2022 CBA Roundtable, Q.7 under ETA, s. 191(1) and s. 123(1) -residential condominium unit.