Ontario First Nations Point-of-Sale Relief - Reporting Requirements for GST/HST Registrants

Transcript

Welcome, my name is Sandy, from the Canada Revenue Agency.

I will be explaining how to report the HST on qualifying off-reserve supplies of property or services, for the point-of-sale relief of the provincial part of the HST, for Ontario First Nations.

The Government of Ontario announced that it will continue providing relief to Indians, Indian bands and councils of an Indian band, from tax on qualifying purchases.

The relief will be an amount equal to the 8% provincial part of the HST.

The Canada Revenue Agency recognizes that many First Nations people prefer not to describe themselves as Indians, however, the term was used here because it has a legal meaning in the Indian Act.

We will use the term eligible First Nations throughout the rest of this video.

For information on what qualifies and who is eligible for the relief, please refer to the Ontario Ministry of Revenue's Website at www.rev.gov.on.ca Beginning September 1, 2010, when a GST/HST registrant supplies qualifying property or services, off a reserve to an eligible First Nations purchaser, the registrant may credit at the point of sale, an amount equal to the 8% provincial part of the HST, and only collect the 5% federal part of the HST on that property or service.

The reporting requirements for the Ontario First Nations point-of-sale relief are two-fold, the first is on your GST/HST return, and the second is the submission of Form GST189, General Application for Rebate of GST/HST.

On your GST/HST return: you will report on Line 105, Total GST/HST and adjustments, the amount of HST collectible on these sales at the full 13% rate so that net tax for the reporting period reflects tax collected or collectible at 13% on these sales, and on Line 111, Rebates, you report a set-off of the amount of the Ontario First Nations Point of Sale relief credited at the point of sale.

Unlike the point-of-sale rebates for the 8% provincial part of the HST credited by GST/HST registrants in Ontario (such as the point-of-sale rebates for children's clothing or books), the amount of the Ontario First Nations Point-of-Sale rebate is not a deduction in the calculation of the registrant's net tax.

Therefore, it is important to reinforce here that it is the full amount, the 13%, rather than only the 5% actually collected, that you report on line 105.

An example to clarify is where a GST HST Registrant credits $1,000 in First Nations point-of-sale relief.

During this reporting period, the registrant has a total of $3,000 of HST collected or collectible which includes this $1,000 credited.

In our example the registrant also has $500 in input tax credits.

In this example, we are portraying the GST/HST paper return and this would be reported as follows.

On line 105, Total GST/HST and adjustments for period: report $3,000.

On line 108, Total input tax credits and adjustments: report $500 Therefore, on line 109, Net Tax: report $2,500 Then on line 111, Rebates: report the $1,000 credited resulting in $1,500 as an amount owing.

The $1,000 credited for First Nations point-of-sale relief should not be included on any other line or in the calculation for any other line.

In the following example, the result is a refund rather than an amount owing.

Again, a GST/HST Registrant credits $1,000 in relief.

During this reporting period, the registrant has a total of $3,000 of HST collected or collectible which includes this $1,000 credited.

In this example the registrant also has $2,500 in input tax credits.

In this example we are portraying the NETFILE system screens and this would be reported as follows.

On line 105, Total GST/HST and adjustments for period: report $3,000.

On line 108, Total Input Tax Credits and adjustments: report $2,500 Therefore, on line 109, Net Tax: report $500 Then on line 111, Rebates: report $1,000 resulting in $500 as a refund claimed.

If your return results in a refund, and you are claiming an Ontario First Nations rebate, your refund will only be sent once the Form GST189 is processed.

Therefore, it is important to submit this form at the same time that you submit your GST/HST return.

As stated earlier, the reporting requirements for the Ontario First Nations point-of-sale relief are two-fold, the first is on your GST/HST return and the second is the submission of Form GST189, General Application for Rebate of GST/HST.

For each reporting period that you claim an Ontario First Nations point of sale rebate on your GST/HST return, you are required to submit, a Form GST189.

This form can either be mailed or filed using our GST/HST NETFILE service when you are filing your GST/HST Return.

You can find this form on our web-site by typing GST189 into the Search function.

If you are mailing the form, indicate Reason Code 23 in Part B - Reason for rebate request.

The mailing address is included on the form.

If you are using GST/HST NETFILE, there is no need to download the paper form.

Simply click "yes" for the "GST189" option under the question "Do you want to file a rebate application along with your GST/HST return." This question appears after you enter your access code.

You will be provided with the appropriate fields in which to enter the amount you are claiming.

Invoicing requirements are the same as those for provincial point-of-sale rebates.

When disclosing the HST on an invoice or receipt where you have credited a relief amount for the provincial part of the HST at the point of sale, you may show: the total amount of the HST payable or the total HST rate with the relief amount credited shown separately; the total HST payable as an amount net of the relief amount credited; or the total price of the qualifying item that includes HST at a net rate of 5%.

This information can also be found in our General Information for GST/HST Registrants Guide, RC4022, and in GST/HST Info Sheet GI-106.

Both can be downloaded from our web-site by entering either the name or the number of the document in our Search function.

You can find further information on using our GST/HST NETFILE service in the videocast: Filing your GST/HST Return using GST/HST NETFILE.

Thank you.

Report a problem or mistake on this page
Please select all that apply:

Thank you for your help!

You will not receive a reply. For enquiries, contact us.

Date modified: