This Canada Revenue Agency notice provides a set of questions and answers to help businesses and consumers understand the transition from HST to GST in British Columbia, effective April 1, 2013. Note that this notice only discusses the transition from HST to GST, not the transition from HST to British Columbia PST. However, based on the budget released by the province last week (see our Tax Development: ‘British Columbia Budget 2012’), the transition to PST, in most cases, will mirror these rules.
In general, GST is payable on property (excluding real property) and services where the tax is payable after March 31, 2013 (if not paid by this date), or where the tax is paid after March 31, 2013 (if not payable before this date). It also has a number of specific questions dedicated to:
- sales of property (excluding real property);
- leases (excluding real property);
- inter-provincial transactions;
- price adjustments and returned goods;
- tax accounting and invoicing; and
- employee and partner rebates.
In particular, note that no rebate for the provincial component of HST is available for tangible property removed from British Columbia to a non-participating province on or after April 1, 2013, and for intangible property or services acquired in British Columbia for consumption, use or supply in a non-participating province on or after April 1, 2013 (see question 28).
In addition, where British Columbia HST is paid on tangible property purchased before April 1, 2013 and subsequently exchanged for another item of a lesser value, from the supplier after March 31, 2013, this would be considered two separate transactions. Accordingly, British Columbia HST must be refunded on the original purchase, and GST must be collected on the value of the exchanged item (see question 31).
CRA Notice 270