16 November 2007 GST/HST Ruling 85659 - XXXXX Printed Materials

Please note that the following document, although correct at the time of issue, may not represent the current position of the Agency. / Veuillez prendre note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'Agence.

Thank you for your letter XXXXX concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to the tax status of independent assessments performed by practitioners when these practitioners form themselves into a partnership.

All legislative references are to the Excise Tax Act (ETA) and the regulations thereunder, unless otherwise specified.

Interpretation Requested

Concerning P-248, The Application of the GST/HST to the Supply of an Independent Medical Examination ("IME") and to Other Independent Assessments, example 6, you would like to know would the results in example 6 be different if the practitioners in the example were psychologists and the "clinic" were a "partnership". In other words, if an individual, who is a "practitioner" as defined by section 1, Part II, Schedule V to the Act, is also a partner in a "partnership", do the provisions of subsection 272.1(1) permit the "partnership" to make supplies that are exempt under section 7 of Part II of Schedule V?

Interpretation Given

The qualifications for a "practitioner" as set out in section 1 of Part II of Schedule V to the Act are such that they can only be held by an individual. It is not possible for a partnership itself to meet the requirements of being a practitioner. Consequently, only individuals who are practitioners can make supplies that qualify for the exemption under section 7 of Part II of Schedule V to the Act. The deeming provision of subsection 272.1(1) to the effect that "anything done by a person as a member of a partnership is deemed to have been done by the partnership" does not override the requirement that for the supply to be exempt under section 7 of Part II of Schedule V, the supplier must be a practitioner as defined in section 1 of Part II of Schedule V to the Act.

The foregoing comments represent our general views with respect to the subject matter of your request. These comments are not rulings and, in accordance with the guidelines set out in GST/HST Memorandum 1.4, Excise and GST/HST Rulings and Interpretations Service, do not bind the Canada Revenue Agency with respect to a particular situation. Future changes to the ETA, regulations, or our interpretative policy could affect this interpretation.

If you require clarification with respect to any of the issues discussed in this letter, please call me directly at 613-954-4394.

Yours truly,

Doris McMullan
Corporate Reorganizations Unit
Financial Institutions and Real Property Division
Excise and GST/HST Rulings Directorate

2007/11/20 — RITS 90956 — GST/HST Treatment of Manufacturer's Rebates