Please note that the following document, although correct at the time of issue, may not represent the current position of the Canada Revenue Agency. / Veuillez prendre note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'Agence du revenu du Canada.
[Addressee]
Excise and GST/HST Rulings Directorate
Place de Ville, Tower A, 15th floor
320 Queen Street
Ottawa ON K1A 0L5
Case Number: 132414
Business Number: [...]
March 20, 2012
Dear [Client]:
Subject:
GST/HST RULING
Supplies [of a service] made in Canada to non-residents
Thank you for your fax of January 31, 2011, concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to a service provided by [...] [(the Company)] to non-residents.
HST applies at the rate of 15% in Nova Scotia, 13% in Ontario, New Brunswick, and Newfoundland and Labrador, and 12% in British Columbia. GST applies at the rate of 5% in the remaining provinces and territories.
All legislative references are to the Excise Tax Act (ETA) unless otherwise specified.
Statement of Facts
Based on the information submitted we understand the following:
1. [...] [The Company] is a corporation located in [...] [a participating province] and is registered for purposes of the GST/HST (BN# [...]).
2. The [Company] [assists] its non-resident clients in relation to the registration [...]
3. [...].
4. Non-resident applicants employ the Company to act on their behalf throughout the application process [...].
5. The Company supplies a service to its clients that [...]. The company obtains [...] for comparison purposes. [...]. The [...] are destroyed once the service is completed. The Company charges a fee to its clients for the service.
Ruling Requested
You have asked for confirmation that the supply of the service described in the facts is zero-rated pursuant to section 21 of Part V of Schedule VI when made to a non-resident recipient that is not registered for GST/HST purposes.
Ruling Given
Based on the facts set out above, we rule that the supply of the service described in the facts is a service that is zero-rated (taxable at 0%) pursuant to section 21 of Part V of Schedule VI when supplied to a non-resident recipient that is not registered for GST/HST purposes.
This ruling is subject to the qualifications in GST/HST Memorandum 1.4, Excise and GST/HST Rulings and Interpretations Service. We are bound by this ruling provided that none of the above issues are currently under audit, objection, or appeal, that no future changes to the ETA, regulations or our interpretative policy affect its validity, and all relevant facts and transactions have been fully disclosed.
Explanation
Generally, a taxable supply of property or a service made in Canada is subject to the GST at 5% when it is deemed to be made in a non-participating province, and is subject to HST at the applicable rate when it is deemed to be made in a participating province unless the property or service is a zero-rated supply.
Pursuant to paragraph 142(1)(g), a supply of a service is deemed to be made in Canada if the service is, or is to be, performed in whole or in part in Canada. The service supplied by the Company to its non-resident clients is deemed to be made in Canada, as the service is performed in Canada.
Section 21 of Part V of Schedule VI zero-rates a supply made to an unregistered non-resident person of a service of testing or inspecting tangible personal property that is imported or acquired in Canada for the sole purpose of having the service performed and where the property is to be destroyed or discarded in the course of providing, or on completion of, the service. The supply of the service, as described in the facts, provided by the Company to its non-resident clients that are not registered for GST/HST purposes is zero-rated pursuant to this provision.
If you require clarification with respect to any of the issues discussed in this letter, please call me directly at (613) 957-7841. Should you have additional questions on the interpretation and application of GST/HST, please contact a GST/HST Rulings officer at 1-800-959-8287.
Yours truly,
Dwayne Moore
Border Issues Unit
General Operations and Border Issues Division
Excise and GST/HST Rulings Directorate
UNCLASSIFIED
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