In a recent decision of the Tax Court of Canada (“TCC”), the Court dismissed the taxpayer’s appeal of a GST assessment for uncollected GST on the sale of a new house.
GST & QST / TPS & TVQ
Input Tax Credits: “Supporting Documentation” Need Not Always Be Issued or Signed by the Supplier
GST registrants can claim input tax credits (“ITCs”) on purchases made in the course of their commercial activities. These ITCs can be used to offset the GST that they are required to collect and remit. In situations where the ITCs exceed the GST collected, registrants are entitled to a net tax refund.
Les administrateurs d’une société doivent payer la TPS et la TVQ si celle-ci omet de le faire
Le restaurant qui appartenait au fils de Monsieur Gaétan Gagné était aux prises avec des difficultés financières. Afin de l’aider, Monsieur Gagné lui a prêté de l’argent, en échange de quoi son fils lui a émis des actions de la société 9129-7903 Québec Inc. (la « Société »). La Société a omis de verser la taxe nette qu’elle devait à Revenu Québec.
Relying on What Others Do Can Be Very Costly
The taxpayer was a corporation carrying on the business of selling and distributing dental products to dentists in Canada, including local anesthetic solutions. 95% of those solutions contained “epinephrine”. Prior to May 2005, the taxpayer sold the anesthetic solutions as “taxable supplies”, meaning that it charged GST. Effective May 1, 2005, it decided to treat the solutions as “zero-rated supplies” and therefore stopped charging GST.
GST/HST Rebate Application Filed Too Late
The taxpayer, a dentist, purchased a practice from another dentist. The taxpayer was under the understanding that the parties would file an election under subsection 167(1) of the Excise Tax Act to avoid paying GST/HST. For reasons that are unclear, no such election was filed.