Temporary GST/HST Relief on Holiday Essentials Ending Soon

The federal government legislated temporary GST/HST relief on taxable foods and beverages, as well as other qualifying items, for a two-month period from December 14, 2024, to February 15, 2025. The end of this tax holiday is quickly approaching, and Ryan reminds taxpayers that any procedures or processes initiated to account for this tax relief must be reversed or turned off after February 15, 2025.

As a reminder, to be eligible for the temporary GST/HST relief, an item must be an eligible supply and be supplied between December 14, 2024, and February 15, 2025 (the “eligible period”). An eligible supply is one that is made available or delivered to and fully paid for by a recipient within the eligible period. For goods, a qualifying supply will be deemed to be delivered to a recipient when the goods are sent by mail or courier or the supplier transfers possession of them to a common carrier retained on behalf of the customer. 

The temporary GST/HST relief should be discontinued for otherwise eligible supplies made to consumers on or after February 16, 2025, where delivery takes place and payment is made at the point of sale. In addition, for other previously eligible supplies, including business-to-business (B2B) transactions, suppliers should confirm both the delivery and payment terms related to the supply. If either delivery or payment occurs after February 15, 2025, GST/HST relief should not be provided. While the delivery condition in the eligibility equation should be easy to ascertain, the payment requirement may present a challenge, especially where payment terms (e.g., net 15 days) are extended to the recipient. As a result, many B2B sales made well before the end of the GST/HST holiday may not qualify for tax relief.

For more information on the GST/HST relief for holiday essentials, see CRA Issues Further Guidance on Temporary GST/HST Relief.

If you have any questions about how the end of the temporary GST/HST relief might impact your organization, please do not hesitate to contact Ryan TaxDirect® at 1.800.667.1600 or taxdirect@ryan.com.