Search - consideration

. … Example of causal allocation (exam cost allocated based on where hires went) Example 10 Financial Institution J had 100 applicants who went through a general process to qualify to be considered for a position with Financial Institution J, and it hired 5 new employees as a result of this process: 1 employee to work in Department A to make taxable supplies for consideration and 4 employees to work in Department B to make exempt supplies. ... Financial Institution J paid for the cost of a standardized exam and allocated it to Department A and Department B based on the number of employees that were hired in each department (that is, 20% for the purpose of making taxable supplies for consideration and 80% for the purpose of making exempt supplies). ... In this case, a revenue‑based allocation will not provide a reasonable approximation of the extent to which the consumption or use of the business input is for the purpose of making taxable supplies for consideration and for purposes other than making taxable supplies for consideration. ...

., where the person making the payment is the supplier of the original supply; the original agreement was for the making of a supply by a person who was not a registrant; the payment is consideration for the supply under the agreement; or the amount is paid otherwise than as a consequence of the breach, modification or termination of the agreement for the making of a supply.... ... Example No. 7 An amount received by a registrant (Qco), following trade name and logo infringement by Rco and upon a court settlement, in exchange for Qco’s agreement to change its name to Zco, is not subject to s. 182(1 and is consideration for a taxable supply. ...

After ruling that the contributions to the Trust Fund made by the employers through the Organization pursuant to the collective agreements were not consideration for a supply, CRA stated: [T]he payment of amounts is an industry development fee set by [the Organization] which is authorized [under the Legislation] to do so […]. ... The payment of amounts as an industry development fee set by [the Organization] are therefore not consideration for a supply and therefore not subject to GST/HST. ...

In finding that the Lessor was not entitled to an input tax credit for the HST on the invoice of the Vendor for both the equipment and the software licence fees to the extent that it relates to the latter, CRA stated: The amount paid [by Assignee] for the software licences…was not consideration for a supply made to the Assignee, since no supply of software licence has ever been made to the Assignee. … Consequently, the Assignee is not considered the recipient of the supply of software licences and is not entitled to claim an ITC for the GST/HST paid for them to the Vendor. ... The definition refers to ‘consideration for the supply’. However, in the present case, the Assignee has not acquired any supply of software licences, and is therefore not entitled to claim any ITC for the tax paid for them. ...

21 December 2017 Interpretation 164739-- summary under Subsection 156(2) Summary Under Tax Topics- Excise Tax Act- Section 156- Subsection 156(2) making the ETA nil consideration election can have punitive results respecting GST/HST on related employee benefits Although ETA s. 173(1) often imputes a taxable supply by an employer based on the amount of taxable benefits conferred by it under ITA s. 6(1)(a), s. 173(1)(d)(i) provides that this rule does not apply where the employer was denied an input tax credit under s. 170 on its acquisition of the property or service that, in turn, was provided to the employee. ... CRA found that this s. 173(1)(d)(i) exclusion did not apply where the property in question (an automobile) was acquired by a closely-related corporation and then leased to the employer with the benefit of the s. 156 nil-consideration election, with the automobile being provided for the exclusive personal benefit of an employee. ...

GST/HST Memorandum 3-6 Conversion of Foreign Currency July 2018-- summary under Relevant Spot Rate Summary Under Tax Topics- Income Tax Act- Section 261- Subsection 261(1)- Relevant Spot Rate CRA policies on FX dates and rates in GST/HST context ETA s. 159 provides that the consideration for a supply expressed in a foreign currency shall be converted using the exchange rate on the day the tax became payable “or such other day as is acceptable to the Minister.” ... In picking an FX rate, the registrant may use: the day the consideration for the supply is paid the day the foreign currency is acquired (as to which CRA provides a simplistic example of the day on which a money order for US$1,000 is acquired, with Canadian funds, to pay a USD invoice in that exact amount) an average rate of exchange for the month in which the tax becomes payable (as to which CRA provides an example in which only two USD invoices were rendered in a month, showing that this method can be used even if it would be practicable to be more precise) CRA provides a somewhat broad list of the acceptable sources for determining the exchange rate to use: the source used for an actual conversion (that is, the source where the foreign currency was exchanged for Canadian dollars) the source the person typically uses for actual conversions (for example, if a US company regular exchanges currency with a local US bank, it can use that bank as its source of FX rates) a Canadian chartered bank the Bank of Canada the CBSA rate used for purposes of converting the value for duty of imported goods An example of an unacceptable source is a commercial database service. ...

CRA nonetheless stated: The administrative arrangement will continue to apply where a dentist or dental corporation follows the terms of the arrangement: the dentist identified the two separate supplies, for example, the invoice issued to the patient identifies the consideration for the supply of the orthodontic appliance or artificial tooth separately from the consideration for the supply of the dental service, and the ITC claim relates to mixed-use purchases (to make both taxable and exempt supplies) such as overhead and general operating expenses and certain direct expenses or inputs (for example, personal property such as arch wires used exclusively to fabricate orthodontic appliances). ...

Where an election under subsection 141.02(9) is in effect for a particular fiscal year for a financial institution, the extent to which a residual input of the financial institution is acquired, or consumed or used, for the purpose of making taxable supplies for consideration is deemed to be the particular prescribed percentage for the prescribed class of the financial institution (that is, 12% for banks, 10% for insurers and 15% for securities dealers). 101. ... As well, if the election is in effect, the following rules apply in respect of each residual input of the financial institution: the extent to which the residual input is acquired by the financial institution or is consumed or used for purposes other than making taxable supplies for consideration is deemed to be equal to the difference between 100% and the prescribed percentage for the prescribed class of financial institution (that difference being 88% for banks, 90% for insurers and 85% for securities dealers) for the purpose of determining an ITC in respect of the residual input, the description of B in the formula in subsection 169(1) is deemed to be equal to the prescribed percentage for the prescribed class of financial institution … 103. ...

X subsequently receives consideration to transfer that interest to builder (the Vendor), Mr. ... X, however, is considered to be a builder in his own right (for example, at the time of entering into the agreement of purchase and sale, he did so for the primary purpose of selling the interest or the house itself), tax would be payable by the Vendor calculated on the value of consideration ($100,000) for the supply. ...

GST/HST Notice No. 324, "Mining Assets in respect of Cryptoassets" June 2025-- summary under Subsection 141.01(4) Summary Under Tax Topics- Excise Tax Act- Section 141.01- Subsection 141.01(4) Application of s. 141.01(4) to crypto mining (which is not a taxable supply because no recipient) where there is a view to sale of the crypto (under " Mining activities in respect of cryptoassets prior to February 5, 2022 " under “ITCs where virtual payment instruments are payable in respect of mining activities”) Subsection 141.01(4) can apply in certain circumstances where acquisitions relate to making taxable supplies for no consideration and it can reasonably be regarded that the supply for no consideration is made for the purpose of facilitating, furthering or promoting an endeavour of any person. ...