Passenger transportation services
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Passenger transportation services
A supply of a passenger transportation service that is part of a continuous journey is made in a province if, where the ticket or voucher issued for the first passenger transportation service provided in the continuous journey specifies the origin of the continuous journey, the origin is a place in the province and the termination, and all stopovers, for the continuous journey are in Canada. There is no change to this place of supply rule. Furthermore, if the origin of the continuous journey is specified in the ticket or voucher that is issued for the first passenger transportation service provided in the continuous journey, but there is a termination or stopover outside Canada for the continuous journey, the supply of the passenger transportation service will continue to be considered made in a non-participating province.
A supply of a passenger transportation service that is part of a continuous journey for which the ticket or voucher issued for the first passenger transportation service provided in the continuous journey does not specify the origin of the continuous journey, is currently considered to be made in a province if the place of negotiation of the supply is in the province. This rule is eliminated. Instead, under the new rule, a supply of a passenger transportation service is made in the province in which the passenger transportation service originates, where the supply:
- is part of a continuous journey for which the ticket or voucher issued for the first passenger transportation service provided in the continuous journey does not specify the origin of the continuous journey; or
- is not part of a continuous journey.
Example
An individual purchases a return flight from Ottawa, Ontario to Montreal, Quebec. The ticket issued for the flight specifies Ottawa as the origin of the continuous journey. The supply of the passenger transportation service is made in Ontario because the ticket issued for the first passenger transportation service provided in the continuous journey specifies the origin of the continuous journey as being in Ontario and there is no termination or stopover outside Canada. The HST will apply to the passenger transportation service at the rate of 13%.
Goods and services supplied during passenger transportation services
Supplies made during international flight or international voyage
If a supply of a good or a service (other than a passenger transportation service) is made to an individual on board an aircraft on an international flight or a vessel on an international voyage and physical possession of the good is transferred to the individual, or the service is wholly performed, on board the aircraft or vessel, the supply is considered made outside Canada and is therefore not subject to GST/HST.
Goods and services supplied during passenger transportation services
Generally, under the current place of supply rule, if the supply by way of sale of a good or a service (other than a passenger transportation service) is made to an individual on board a conveyance in the course of a business of supplying passenger transportation services and physical possession of the good is transferred to the individual, or the service is wholly performed, on board the conveyance during any leg of the journey that begins in any participating province and ends in any participating province, the supply is made in the participating province in which that leg of the journey begins.
If a supply by way of sale of a good or a service (other than a passenger transportation service) is made to an individual on board a conveyance in the course of a business of supplying passenger transportation services and physical possession of the good is transferred to the individual, or the service is wholly performed, on board the conveyance during any leg of a journey that begins in any province and ends in any province, the supply of the property or service is made in the province in which that leg of the journey begins.
Example
A passenger who is on a journey by air from Ottawa, Ontario to Vancouver, British Columbia (BC), purchases a carbonated beverage during the Ottawa-Calgary (Alberta) leg of the journey and then purchases another carbonated beverage during the Calgary-Vancouver leg of the journey. The supply of the first beverage is made during the Ottawa-Calgary leg of the journey that begins in Ontario, and is therefore made in Ontario. The HST will apply to the first beverage at the rate of 13%. The supply of the second beverage that is made during the Calgary-Vancouver leg of the journey that begins in Alberta, is therefore made in Alberta. The GST will apply to the supply at the rate of 5%.
Services related to the supply of passenger transportation services
Baggage charges
A supply made by the supplier of a passenger transportation service of a service of transporting an individual's baggage in connection with the passenger transportation service is made in the same province in which the supply of the passenger transportation service is made.
Example
In connection with supplying a domestic passenger transportation service to a passenger that is made in New Brunswick, an airline charges an additional excess baggage fee to an individual who has exceeded the checked baggage allowance for the particular flight. The service of transporting the excess baggage is made in the province that the passenger transportation service is made, which in this case is New Brunswick. The HST will apply to the service at the rate of 15%.
Child supervision
A supply made by the supplier of a passenger transportation service of a service of supervising an unaccompanied child in connection with the passenger transportation service is made in the same province in which the supply of the passenger transportation service is made.
Example
In connection with supplying a domestic passenger transportation service made in Ontario for an unaccompanied child, an airline supplies the service of supervising the unaccompanied child. The service of supervising the unaccompanied child is made in the province in which the passenger transportation service is made, which in this case is Ontario. The HST will apply to the service at the rate of 13%.
Services related to a ticket, voucher or reservation
A supply made by a supplier of a passenger transportation service of a service of issuing, delivering, amending, replacing or cancelling a ticket, voucher or reservation for the passenger transportation service is made in the same province in which the passenger transportation service will, if it were completed in accordance with the agreement for that supply, be made.
Example
An individual cancels a ticket for a return flight from Ottawa to Toronto that specifies Ottawa as the origin of the continuous journey. The supply of the service of cancelling the ticket is made in Ontario because the passenger transportation service for which the ticket will have applied is made in Ontario. The HST will apply to the service of cancelling the ticket at the rate of 13%.
Forms and publications
- Date modified:
- 2016-07-07