Definition of  Listed Financial Institution

GST/HST memorandum 17-6
June 2026

This version replaces the one dated July 2014. This memorandum has been revised to include amendments to the definition of investment plan under subsection 149(5) and other related provisions of the Excise Tax Act (ETA). This memorandum has also been updated to include proposed amendments to the ETA that were announced on August 24, 2024.

Except as otherwise noted, all statutory references in this publication are to the provisions of the Excise Tax Act (ETA). The information in this publication does not replace the law found in the ETA and its regulations. Although correct at the time of issue, this publication may not have been updated to reflect subsequent legislative changes.

If this information does not completely address your particular situation, you may wish to refer to the ETA or relevant regulation, or call GST/HST Rulings at 1‑800‑959‑8287 for additional information. If you require certainty with respect to any particular GST/HST matter, you may request a ruling. GST/HST Memorandum 1-4, Requesting a GST/HST Ruling or Interpretation, explains how to obtain a ruling or an interpretation.

If you are located in Quebec and wish to request a ruling related to the GST/HST, please call Revenu Québec at 1‑800‑567‑4692. You may also visit the Revenu Québec website at revenuquebec.ca to obtain general information.

For listed financial institutions that are selected listed financial institutions (SLFIs) for GST/HST or Quebec sales tax (QST) purposes or both, whether or not they are located in Quebec, the CRA administers the GST/HST and the QST. If you wish to make a technical GST/HST or QST enquiry related to SLFIs, please call 1‑855‑666‑5166.

GST/HST rates

Reference in this publication is made to supplies that are subject to the GST or the HST. The GST/HST rates are those that were in effect at the time of publishing. For the list of all applicable GST/HST rates (current and historic), go to GST/HST calculator (and rates).

If you are uncertain as to whether a supply is made in a participating province, refer to GST/HST Memorandum 3-3-2, Place of Supply in a Province – Overview.

Table of Contents

• Financial institutions
• Listed financial institutions
  • Description of each category of listed financial institution
    • Bank
    • Corporation that is licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering to the public its services as a trustee
    • Person whose principal business is as a trader or dealer in, or as a broker or salesperson of, financial instruments or money
    • Credit union
    • Insurer or any other person whose principal business is providing insurance under insurance policies
    • Segregated fund of an insurer
    • Canada Deposit Insurance Corporation
    • Person whose principal business is the lending of money or the purchasing of debt securities or a combination thereof
    • Investment plan
    • Person providing services referred to in section 158
    • Corporation deemed under section 151 to be a financial institution
• Amalgamation and acquisition
• Selected listed financial institutions

Financial institutions

1. Financial institution is defined in subsection 123(1) to mean a person that is a financial institution under section 149. Subsection 149(1) identifies two categories of financial institutions for GST/HST purposes: listed financial institutions (LFIs), which are persons described in paragraph 149(1)(a), and de minimis financial institutions, which are persons that are determined to be financial institutions based on the de minimis threshold tests set out in paragraphs 149(1)(b) and (c). For more information on de minimis financial institutions, refer to GST/HST Memorandum 17-7, De Minimis Financial Institutions.

2. Determining whether a person is a financial institution is necessary because financial institutions are subject to particular treatment under various provisions of the ETA. Some provisions apply specifically to financial institutions, while others only apply to LFIs or selected listed financial institutions (SLFIs). For example, under paragraph 240(3)(c), an LFI resident in Canada that is not engaged in a commercial activity in Canada is permitted to register voluntarily for GST/HST purposes. For information on when an LFI is required to be registered for GST/HST purposes and when it may voluntarily register, refer to GST/HST Memorandum 17-6-2, GST/HST Registration and Reporting Requirements for Listed Financial Institutions, Including Selected Listed Financial Institutions.

3. In addition, other provisions specifically exclude financial institutions, LFIs, or SLFIs from the application of the particular provision. For example, section 185 (generally regarding determining an input tax credit on property and services acquired, imported, or brought into a participating province by a registrant for consumption, use, or supply in the course of making supplies of financial services that relate to the registrant's commercial activities) and section 198 (generally regarding the extent that capital property of a registrant is used by the registrant in making supplies of financial services that relate to the registrant's commercial activities) do not apply to LFIs.

Listed financial institutions

4. Listed financial institution is defined in subsection 123(1) to mean "a person referred to in paragraph 149(1)(a)". Specifically, a person is an LFI throughout a particular taxation year if, at any time in the particular year, the person is described in one of the following categories in subparagraphs 149(1)(a)(i) to (xi):

• (i) a bank (refer to paragraph 6 of this memorandum)
• (ii) a corporation that is licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering to the public its services as a trustee (refer to paragraph 7 of this memorandum)
• (iii) a person whose principal business is as a trader or dealer in, or as a broker or salesperson of, financial instruments or money (refer to paragraphs 8 to 13 of this memorandum)
• (iv) a credit union (refer to paragraphs 14 to 17 of this memorandum)
• (v) an insurer or any other person whose principal business is providing insurance under insurance policies (refer to paragraphs 18 to 20 of this memorandum)
• (vi) a segregated fund of an insurer (refer to paragraphs 21 and 22 of this memorandum)
• (vii) the Canada Deposit Insurance Corporation (refer to paragraph 23 of this memorandum)
• (viii) a person whose principal business is the lending of money or the purchasing of debt securities or a combination thereof (refer to paragraphs 24 and 25 of this memorandum)
• (ix) an investment plan (refer to paragraphs 26 and 27 of this memorandum)
• (x) a person providing services referred to in section 158 (tax discounters) (refer to paragraph 28 of this memorandum)
• (xi) a corporation deemed under section 151 to be a financial institution (a corporation that is a member of a closely related group that has an election under subsection 150(1) in effect) (refer to paragraphs 29 and 30 of this memorandum)

Description of each category of listed financial institution

5. The following paragraphs provide further information on each category of LFI.

Bank

6. Under subparagraph 149(1)(a)(i), a bank is an LFI. The term bank is defined in subsection 123(1) to mean "a bank or an authorized foreign bank within the meaning of section 2 of the Bank Act". It is proposed that the definition of bank in subsection 123(1) be amended to exclude a credit union.^{Footnote 1} Under section 2 of the Bank Act, the term bank means a bank listed in Schedule I or II of the Bank Act and the term authorized foreign bank means a foreign bank that is the subject of an order under subsection 524(1) of the Bank Act. For more information on credit unions, refer to paragraphs 14 to 17 of this memorandum.

Corporation that is licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering to the public its services as a trustee

7. Under subparagraph 149(1)(a)(ii), a corporation that is licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering to the public its services as a trustee is an LFI. A corporation that is a trust company regulated under either federal or provincial laws (such as the federal Trust and Loan Companies Act) to provide services to the public as a trustee is a person described in subparagraph 149(1)(a)(ii).

Person whose principal business is as a trader or dealer in, or as a broker or salesperson of, financial instruments or money

8. Under subparagraph 149(1)(a)(iii), a person whose principal business is as a trader or dealer in, or as a broker or salesperson of, financial instruments or money is an LFI. Subparagraph 149(1)(a)(iii) includes any person whose principal business is the buying and selling of financial instruments, or the exchanging of money as principal, or whose principal business is acting as a salesperson or broker for a principal that is engaged in such trades or exchanges. As examples, it generally includes a person whose principal business is that of an investment dealer, a stock and bond broker, a securities trader, a foreign currency trader or broker, or an insurance agent or broker. For more information on insurance agents or brokers, refer to GST/HST Memorandum 17-9, Insurance Agents and Brokers. For more information on financial instruments, refer to GST/HST Memorandum 17-1, Definition of Financial Instrument.

9. The determination of a person's principal business is relevant to the interpretation of subparagraphs 149(1)(a)(iii), (v), and (viii).

10. The term business is defined in subsection 123(1) to include a profession, calling, trade, manufacture, or undertaking of any kind whatever, with or without regard to an expectation of profit. Any activity engaged in on a regular or continuous basis involving the supply of property by way of lease, licence, or similar arrangement is also included in the definition of business. An office or employment is excluded from the definition. For more information on the definition of business, refer to GST/HST Policy Statement P-167R, Meaning of the First Part of the Definition of Business, and GST/HST Policy Statement P-205R, Meaning of the Second Part of the Definition of Business and Whether it Applies to Activities Regardless of Whether There is an Expectation of Profit.

11. The ETA does not define the term principal, and therefore its common or ordinary meaning applies for GST/HST purposes. As a result, in the context of section 149, the Canada Revenue Agency (CRA) considers that principal refers to the person's chief or main business activity.

12. To determine what the principal business of a person is for the purposes of section 149, a review of the facts and circumstances of each case is required. This review may include an examination of each kind of business activity carried out by the person. Some factors to be considered include, but are not limited to:

• the relative profits realized by each segment of a person's business
• the total number of supplies made and the total value of the revenue received from supplies made in each business activity
• the relative value of the assets employed in each business activity
• the commercial practices of the person, including the time, attention, and efforts expended by the employees, managers, or corporate officers in each business activity
• the terms of any partnership agreement, if the person is a partnership, or corporate objects, in the case of a corporation

13. In the case of subparagraph 149(1)(a)(iii), it will be a question of fact whether or not a particular person's principal business is as a trader or dealer in, or as a broker or salesperson of, financial instruments or money.

Credit union

14. Under subparagraph 149(1)(a)(iv), a credit union is an LFI. The term credit union is defined in subsection 123(1) as having the meaning assigned by subsection 137(6) of the Income Tax Act (ITA) and includes a corporation described in paragraph (a) of the definition of deposit insurance corporation in subsection 137.1(5) of the ITA.

15. Credit union is defined in subsection 137(6) of the ITA to mean a corporation, association, or federation incorporated or organized as a credit union or cooperative credit society provided one of the following applies:

• it is a federal credit union or a provider of financial services that is organized on cooperative principles and incorporated by or under an Act of the legislature of a province
• all or substantially all its members having full voting rights were corporations, associations, or federations described in subparagraphs (b)(i) to (iii) of the definition of credit union in subsection 137(6) of the ITA or were corporations, associations, or federations no part of the income of which was payable to, or otherwise available for the personal benefit of, any shareholder or member thereof
• it is an entity meeting the requirements of paragraph (c) of the definition of credit union in subsection 137(6) of the ITA; that is, the corporation, association, or federation would be a credit union under paragraph (b) of that definition if all the members (other than individuals) having full voting rights in each member thereof that is a credit union were members having full voting rights in the corporation, association, or federation

16. A corporation described in paragraph (a) of the definition of deposit insurance corporation in subsection 137.1(5) of the ITA means a corporation that was incorporated by or under a law of Canada or a province respecting the establishment of a stabilization fund or board if the corporation meets the conditions described in subparagraphs (i) and (ii) in paragraph (a) of the definition of deposit insurance corporation in subsection 137.1(5) of the ITA.

17. The term credit union includes a caisse populaire. 

Insurer or any other person whose principal business is providing insurance under insurance policies

18. Under subparagraph 149(1)(a)(v), an insurer or any other person whose principal business is providing insurance under insurance policies is an LFI. The term insurer is defined in subsection 123(1) to mean "a person who is licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada an insurance business or under the laws of another jurisdiction to carry on in that other jurisdiction an insurance business". For example, an insurance company that is licensed as an insurer under a provincial insurance statute is an LFI.

19. A person that is not an insurer as defined in the ETA but whose principal business is providing insurance under insurance policies is also an LFI. For GST/HST purposes, insurance policy is defined in subsection 123(1) and includes:

• a policy or contract in the nature of accident and sickness insurance, even if the policy is issued, or the contract is entered into, by a person that is not an insurer
• a bid, performance, maintenance, or payment bond issued in respect of a construction contract

20. In the case of subparagraph 149(1)(a)(v), it will be a question of fact whether or not a particular person's principal business is providing insurance under insurance policies. The concept of principal business for GST/HST purposes is discussed in paragraphs 9 to 12 of this memorandum.

Segregated fund of an insurer

21. Under subparagraph 149(1)(a)(vi), a segregated fund of an insurer is an LFI. The term segregated fund of an insurer is defined in subsection 123(1) to mean "a specified group of properties that is held in respect of insurance policies all or part of the reserves for which vary in amount depending on the fair market value of the properties".

22. Under subsection 131(1), a segregated fund of an insurer is deemed to be a trust that is a separate person from the insurer and that does not deal at arm's length with the insurer.

Canada Deposit Insurance Corporation

23. Under subparagraph 149(1)(a)(vii), the Canada Deposit Insurance Corporation is an LFI. The Canada Deposit Insurance Corporation is a federal Crown corporation that provides insurance in respect of funds on deposit with its member institutions.

Person whose principal business is the lending of money or the purchasing of debt securities or a combination thereof

24. Under subparagraph 149(1)(a)(viii), a person whose principal business is the lending of money or the purchasing of debt securities or a combination of these activities is an LFI. Generally, a person that carries on business principally as a finance company; an acceptance company; a factor; a venture capitalist; or a loan, mortgage, or investment company is considered to be a person described in subparagraph 149(1)(a)(viii). In the case of subparagraph 149(1)(a)(viii), it will be a question of fact whether or not a particular person's principal business is the lending of money or the purchasing of debt securities or a combination of these activities. The concept of principal business for GST/HST purposes is discussed in paragraphs 9 to 12 of this memorandum.

25. While subsection 149(4) allows a person to exclude interest or dividends from certain persons for purposes of determining whether the person is a de minimis financial institution under paragraph 149(1)(b) or (c), subsection 149(4) does not apply for purposes of determining whether the person is an LFI under paragraph 149(1)(a). For example, a person whose principal business is lending money to related corporations or purchasing debt securities from related corporations or a combination of these activities is an LFI.

Investment plan

26. Under subparagraph 149(1)(a)(ix), an investment plan is an LFI. For purposes of subparagraph 149(1)(a)(ix), the following trusts, partnerships, and corporations are investment plans as defined under subsection 149(5):

• (a)    a trust governed by any of the following (as each of the following terms are defined for the purposes of the ITA or Income Tax Regulations):
  • (i) a registered pension plan
  • (i.1) a pooled registered pension plan
  • (ii) an employees profit sharing plan
  • (iii) a registered supplementary unemployment benefit plan
  • (iv) a registered retirement savings plan
  • (iv.1) a TFSA (tax-free savings account)
  • (iv.2) a first home savings account^{Footnote 2}
  • (v) a deferred profit sharing plan
  • (vi) a registered education savings plan
  • (vi.1) a registered disability savings plan
  • (vii) a registered retirement income fund
  • (viii) an employee benefit plan
  • (ix) an employee trust
  • (x) a mutual fund trust
  • (xi) REPEALED^{Footnote 3}
  • (xii) a unit trust
  • (xiii) a retirement compensation arrangement
• (b) an investment corporation, as defined in the ITA
• (c) a mortgage investment corporation, as defined in the ITA
• (d) a mutual fund corporation, as defined in the ITA
• (e) a non-resident-owned investment corporation, as defined in the ITA
• (f) a corporation exempt from tax under the ITA by reason of paragraph 149(1)(o.1) or (o.2) of the ITA
• (f.1) an investment limited partnership, as defined in subsection 123(1)
• (g) a prescribed person or a person of a prescribed class

27. Section 4.2 of the Financial Services and Financial Institutions (GST/HST) Regulations provides that an employee life and health trust, as defined in subsection 248(1) of the ITA, is a prescribed person for purposes of paragraph 149(5)(g). Currently, there are no other prescribed persons or persons of a prescribed class.

Person providing services referred to in section 158

28. Under subparagraph 149(1)(a)(x), a person providing services referred to in section 158 is an LFI. Generally, a tax discounter is a person described in subparagraph 149(1)(a)(x). Section 158 provides rules for the treatment of supplies to which the Tax Rebate Discounting Act applies. These supplies involve customers assigning their rights to an income tax refund to a tax discounter in return for an immediate payment. For a person to be considered a tax discounter, the person must come within the meaning of the term discounter under the Tax Rebate Discounting Act. For more information on tax discounters, refer to GST/HST Memorandum 17-10, Tax Discounters.

Corporation deemed under section 151 to be a financial institution

29. Under subparagraph 149(1)(a)(xi), a corporation that is deemed to be a financial institution under section 151 is an LFI. A corporation that is a member of a closely related group of which an LFI described in any of subparagraphs 149(1)(a)(i) to (x) is a member and that has a joint election under subsection 150(1) in effect with another member of the closely related group is deemed to be a financial institution under section 151. Form GST27, Election or Revocation of an Election to Deem Certain Supplies to be Financial Services for GST/HST Purposes, or Form RC7227, Elections or Revocation of the Elections to Deem Certain Supplies to be Financial Services for GST/HST and QST Purposes for Selected Listed Financial Institutions, is used to make the joint election under subsection 150(1).

30. Under subsection 150(1), where a corporation that is a member of a closely related group (of which an LFI is a member) and another member of that group make a joint election, supplies between the two members of property made by way of lease, licence, or similar arrangement, or of services that are made while the election is in effect and that, in the absence of this election, would have been taxable supplies, are deemed (with certain exceptions) to be supplies of financial services. Refer to GST/HST Memorandum 17-14, Election to Deem Supplies to be Financial Services and Related Election for Selected Listed Financial Institutions, for more information on the subsection 150(1) election.

Amalgamation and acquisition

31. Under subsection 149(2), where two or more corporations (the predecessors) are merged or amalgamated to form a new corporation and the principal business of the new corporation immediately after that time is the same as, or similar to, the business of one or more of the predecessors that immediately before that time was a financial institution, then the new corporation is considered to be a financial institution for its taxation year that commences on the date of the merger or amalgamation. However, the new corporation is only considered to be an LFI if it is a person referred to in paragraph 149(1)(a). The concept of principal business for GST/HST purposes is discussed in paragraphs 9 to 12 of this memorandum.

32. In addition, under paragraph 271(b), where two or more corporations are merged or amalgamated to form a new corporation, the new corporation is considered to be the same corporation as, and a continuation of, each predecessor corporation for certain purposes, including for the purposes of applying subsection 149(1).

33. Under subsection 149(3), where a person acquires a business as a going concern from a person that immediately before that time was a financial institution, the person acquiring the business is considered to be a financial institution for the remainder of the taxation year if the acquired business is continued as the purchaser's principal business immediately after the purchase. However, the person acquiring the business is only considered to be an LFI if it is a person referred to in paragraph 149(1)(a). The concept of principal business for GST/HST purposes is discussed in paragraphs 9 to 12 of this memorandum.

34. Where a person that is not a financial institution acquires a non-financial business from a financial institution, the CRA does not consider the person acquiring the business to be a financial institution in this particular situation, unless the person wants to be considered to be a financial institution. If a person in this particular situation wants to be considered a financial institution, the person should advise the CRA in writing of this change and the applicable period.

35. The CRA considers that the rule respecting the acquisition of a business applies only to the purchase of an entire business or a division of a business that operates as a going concern. It does not apply to the sale of shares by one person to another where the corporate entity continues its operations.

Selected listed financial institutions

36. In some cases, an LFI can also be an SLFI.

37. Under subsection 225.2(1), a financial institution is generally considered to be an SLFI throughout a reporting period in a fiscal year that ends in its taxation year if the financial institution is an LFI described in any of subparagraphs 149(1)(a)(i) to (x) at any time in the taxation year and meets one of the following conditions:

• it has, at any time in the taxation year, a permanent establishment in a participating province and has, at any time in the taxation year, a permanent establishment in any other province
• it is a qualifying partnership during the taxation year

38. For purposes of determining whether a financial institution is an SLFI, the meaning of permanent establishment is expanded for certain types of LFIs such that the existence of a permanent establishment is generally determined based on the location of the financial institution's clients, operations, unit holders, and/or plan members. For more information on SLFIs, refer to GST/HST Memorandum 17-6-1, Definition of Selected Listed Financial Institution.

39. A corporation that is an LFI described in subparagraph 149(1)(a)(xi) (that is, deemed to be a financial institution under section 151 as a result of having a subsection 150(1) election in effect) cannot be an SLFI, unless the corporation is also an LFI described in any of subparagraphs 149(1)(a)(i) to (x). For more information on subparagraph 149(1)(a)(xi), refer to paragraphs 29 and 30 of this memorandum.

Further information