Harmonized Sales Tax for British Columbia - Point-of-Sale Rebate on Motor Fuels

GST/HST Info Sheet GI-061
February 2010

The Government of British Columbia has announced that it would provide a point-of-sale rebate of the provincial part of the proposed HST payable on qualifying motor fuels. The CRA and the Canada Border Services Agency (CBSA) would administer the rebate on behalf of the Government of British Columbia.

In this publication:

"Consumer" means an individual who acquires qualifying motor fuels for the individual's personal consumption or use, or for the personal consumption or use of another individual.

"Provincial part of the HST" means the 7% British Columbia part of the HST.

"Qualifying motor fuels" means goods designated by the Government of British Columbia as qualifying motor fuels and satisfying prescribed conditions. More information is available under the heading "Goods qualifying for the rebate".

"Rebate" means the proposed point-of-sale rebate of the provincial part of the HST payable on qualifying motor fuels, which would be provided by the Government of British Columbia.

"Recipient" of qualifying motor fuels means the person who is liable to pay for the motor fuels. When no amount is due, it means the person to whom the motor fuels are delivered or made available. A recipient could be a wholesaler, retailer or consumer.

"Registrant" means a person who is registered, or is required to be registered, for GST/HST purposes.

Who would be eligible for the rebate

The rebate would be available to all persons that:

• are recipients of qualifying motor fuels sold in British Columbia;
• are resident in British Columbia and that import qualifying motor fuels in circumstances where the provincial part of the HST would be payable on the importation; and
• receive delivery or possession of qualifying motor fuels in, or bring qualifying motor fuels into, British Columbia in circumstances where the provincial part of the HST would be payable on the motor fuels.

The rebate would be available at any point in the distribution chain of the qualifying motor fuels. For example, the rebate would be available to persons that are wholesalers, retailers or consumers of qualifying motor fuels.

Goods qualifying for the rebate

The following goods would be qualifying motor fuels for purposes of the rebate:

• gasoline-type fuels, including ethanol-gasoline blends, that are suitable for use in internal combustion engines and are marketed or sold as fuel for that purpose;
• diesel, bio-diesel and bio-diesel blends (but not including heavy fuel oil) that are suitable for use in internal combustion engines of the compression-ignition type and are marketed or sold as fuel for that purpose, other than any such fuel that is marketed or sold as fuel for use as heating oil, including locomotive fuel and marine diesel, marketed or sold as fuel for use in trains or boats; and
• aircraft fuel, including aviation gasoline and jet fuel, that is suitable for use in an engine or in a turbine that propels an aircraft and is marketed or sold as fuel for that purpose.

The following goods would not be qualifying motor fuels for purposes of the rebate, and therefore, no rebate would be available in respect of the provincial part of the HST payable on these goods:

• heating oil and furnace oil;
• heavy fuel oil, including marine bunker fuel (or bunker oil);
• hydrogen;
• kerosene (excluding jet fuel);
• natural gas and natural gas liquids (e.g., liquefied natural gas or LNG); and
• propane and liquefied petroleum gas (LPG).

How to claim the rebate

Recipients of qualifying motor fuels sold in British Columbia would receive their rebate by:

• being paid or credited the rebate amount by the registrant supplier (e.g., a producer, wholesaler or retailer) at the point of sale; or
• filing a rebate claim with the CRA.

Rebate amount paid or credited by registrant suppliers

Generally, recipients of qualifying motor fuels sold in British Columbia would automatically have their rebate paid or credited to them at the point of sale by the registrant supplier that sold the motor fuels to them.

The rebate amount that a registrant supplier would pay or credit to the recipient would equal the amount of the provincial part of the HST that would be payable by the recipient on the sale of the qualifying motor fuels.

A registrant supplier that pays or credits the rebate amount at the point of sale would collect only the 5% federal part of the HST on the sale of the qualifying motor fuels. Information on how a registrant supplier discloses the rebate amount paid or credited is available under the heading "How registrant suppliers show the rebate on their invoices".

Filing rebate claims with the CRA

If the registrant supplier does not pay or credit the rebate amount at the point of sale, then the recipient of the qualifying motor fuel sold in British Columbia would be able to file a rebate claim with the CRA using Form GST189, General Application for Rebate of GST/HST.

The rebate amount that the CRA would pay to the recipient would equal the amount of the provincial part of the HST that the recipient paid on the sale of the qualifying motor fuel. The recipient would have to file Form GST189 within four years after the day the provincial part of the HST became payable.

If the registrant supplier does not pay or credit the rebate amount at the point of sale and the recipient of the qualifying motor fuel sold in British Columbia is a registrant acquiring the motor fuel for use or supply in the course of a commercial activity, then the recipient would be able to claim an input tax credit (ITC) to recover the 5% federal part of the HST paid. The recipient would also be able to file a rebate claim with the CRA, using Form GST189, to recover the 7% provincial part of the HST paid. The recipient would have to file this form within four years after the day the provincial part of the HST became payable.

Residents importing qualifying motor fuels

Generally, persons that are resident in British Columbia and that import qualifying motor fuels in circumstances where the provincial part of the HST would be payable on the importation would automatically have their rebate deducted by the CBSA from the HST payable.

The rebate amount that the CBSA would deduct would equal the amount of the provincial part of the HST that would be payable by the person on the imported qualifying motor fuel. The CBSA would, therefore, collect only the 5% federal part of the HST on the imported qualifying motor fuel.

Persons bringing qualifying motor fuels into British Columbia

In certain circumstances, a person that brings qualifying motor fuels into British Columbia would have to self-assess the provincial part of the HST on these motor fuels. Generally, the person would be eligible for a rebate equal to the amount of the provincial part of the HST that would be payable by the person on the qualifying motor fuels.

Rebate for registrants

If the person is a registrant, the person would account for the provincial part of the HST self-assessed on the qualifying motor fuels brought into British Columbia on its regular GST/HST return for the reporting period in which the tax became payable.

The person would receive its rebate by claiming a deduction for the rebate amount on the return for the reporting period in which the tax became payable.

Rebate for non-registrants

If the person is not a registrant, the person would normally account for the provincial part of the HST self-assessed on the qualifying motor fuel brought into British Columbia on Form GST489, Return for Self-Assessment of the Provincial Portion of the Harmonized Sales Tax (HST), no later than the last day of the month after the calendar month in which the tax became payable.

However, the person would receive the rebate by deducting the rebate amount for the self-assessed provincial part of the HST. The person would not have to file Form GST 489 where the resulting amount is nil.

How registrant suppliers show the rebate on their invoices

When disclosing the HST on an invoice or receipt issued in respect of the sale of qualifying motor fuels to which the registrant supplier has paid or credited the rebate amount at the point of sale, the registrant supplier may show:

• the total amount of the HST payable (or the total HST rate) with the rebate amount paid or credited shown separately;
• the total HST payable as an amount net of the rebate amount paid or credited; or
• the total price of the qualifying motor fuel that includes HST at a net rate of 5%.

How registrant suppliers account for the rebate on their GST/HST returns

A registrant supplier that pays or credits the rebate amount at the point of sale would have two options for accounting for the rebate amount on its GST/HST return.

First, the registrant supplier may account for the total HST collected or collectible (i.e., 12% for British Columbia) on line 103 of the GST/HST return, and claim an adjustment for the rebate amount paid or credited on line 107.

Second, the registrant supplier may show the net amount as the HST collected or collectible (i.e., 5%) on line 103, and not claim an adjustment for the rebate amount paid or credited on line 107.

Date modified:

2010-02-26