National Money Mart – Ontario Court of Appeal finds that a supplier can issue an invoice after being assessed for the HST on the supply

A supplier failed to charge HST on sales of unrefined gold. When CRA discovered this, the supplier issued invoices to the purchaser showing the sale particulars and the applicable amount of HST as being unpaid, and following being assessed for this tax by CRA and paying it, sued the purchaser for its payment.

The purchaser relied on the requirement in ETA s. 224 for compliance with the disclosure requirement in s. 223(1) in order for the supplier to have the right to sue the purchaser for unpaid HST. In finding that the post-sale invoices satisfied this requirement, Brown JA stated:

Section 223(1) is silent on when a registrant must give disclosure of the tax payable to a recipient. The overwhelming weight of the jurisprudence, the CRA’s Policy Statement P-116, and the professional commentary have interpreted that statutory silence to mean that a registrant supplier can comply with the s. 223(1) disclosure obligations by delivering an invoice or receipt containing the prescribed information after the supply transaction.

Neal Armstrong. Summary of National Money Mart Co. v 24 Gold Group Ltd, 2018 ONCA 812 under ETA s. 223(1).