The Canada Revenue Agency has issued this memorandum, which outlines the circumstances where an adjustment, refund or credit of the GST/HST may occur pursuant to section 232 of the Excise Tax Act. Essentially, a supplier is permitted to adjust, refund or credit GST/HST in two situations: where an excess amount of tax has been charged or collected; or where consideration for a supply is reduced some time after the tax has been charged or collected. This memorandum updates and replaces GST/HST Technical Information Bulletin B-042, “Refund, Adjustment or Credit of the GST” and incorporates information from GST/HST Policy Statement P-030R, “Credit/Debit Notes and Net Tax Adjustments”.
CRA GST/HST Memorandum 12.2
“Refund, Adjustment, or Credit of the GST/HST under Section 232 of the Excise Tax Act”