Place of supply – General rules for IPP with unlimited use

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Place of supply – General rules for IPP with unlimited use

Use the following rules to determine the GST/HST rate for the supply of intangible personal property (IPP) that can be used in more than one province if there are no limits to where the IPP can be used or there are limits, but the extent of the limits cannot be determined.

Use the general rules for IPP with limited use if there limits to the extent of where the IPP can be used and those limits can be determined.

When a supply of IPP is made in the province where it is sold

Your supply of IPP is made in the province where you sold it if all of the following conditions are met:

  • the IPP can be used in the province where you sold it
  • there are no limits to where the IPP can be used or there are limits, but extent of the limits cannot be determined
  • the total value of the IPP is less than $300
  • you made the supply through your permanent establishment or a vending machine
  • the supply is made in the presence of the purchaser or an individual who acts on behalf of the purchaser

In this case, GST/HST applies at the rate for the province where your permanent establishment or the vending machine is located.

When a supply of IPP is made in the province where the purchaser's address is located

If the supply is not made in the province where the IPP is sold because all of the conditions are not met, the supply is made in the province where the purchaser's address is located in certain situations.

IPP is supplied in the province where the purchaser's address is located if the following conditions are met:

  • the purchaser's address is a Canadian address and you obtained it in the ordinary course of your business
  • the IPP can be used in the province where you sold it
  • there are no limits to where the IPP can be used or there are limits, but the extent of the limits cannot be determined
  • the value of the IPP is at least $300 or you did not supply the IPP through your permanent establishment or a vending machine

IPP is also supplied in the province where the purchaser's address is located if these conditions are met:

  • the purchaser's address is a Canadian address and you obtained it in the ordinary course of your business
  • the IPP cannot be used in the province where you sold it
  • use of the IPP is limited to the participating provinces
  • you did not make the supply through your permanent establishment or a vending machine

GST/HST applies at the rate for the province where the purchaser's address is located.

Which address do I use?

If you obtained only one address and the address is:

  • the purchaser's home or business address, use that address
  • not a home or business address, but you obtained another address (such as a billing address), use that address

If you obtained more than one address, use the address that is most closely connected with the supply.

When a supply of IPP is made in the province with the highest rate

HST applies at the highest rate among the provinces where the IPP can be used if all of the following conditions are met:

  • the IPP can be used in more than one province
  • there are no limits to the extent of where the IPP can be used or there are limits, but the extent of the limits cannot be determined
  • the supply is not made in the province where the IPP is sold because all of the conditions are not met
  • the supply is not made in the province where the purchaser's address is located because all of the conditions are not met

However, if the provinces where the IPP can be used have the same highest rate, HST applies at the rate for the province where your business address that is most closely connected with the supply is located.

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Date modified:
2016-07-07