Cannabis duty – Completing a cannabis duty return

The information described on this webpage is based on the Excise Act, 2001 and its regulations.

This page provides line-by-line instructions on how to complete Form B300, Cannabis Duty and Information Return, which is required to be filed monthly by cannabis licensees under the Excise Act, 2001.

Effective October 17, 2019, the sale of edible cannabis, cannabis extracts and cannabis topicals will be permitted under the Cannabis Act. The B300 return has been updated for the reporting of production activities and duty payable for these products, and the instructions below must be followed for the reporting of transactions pertaining to all cannabis products.

Instructions for Section 1: Business information

Section 1 of the return is used to identify the cannabis licensee. Current and accurate information is required to be provided for each field as follows:

Business information

Provide the legal name and the business number of the account for which the return is being filed. If the legal name of the business has changed, you need to contact your CRA regional excise office to report the change. A list of the offices is available at Contact Information – Excise Duty, Excise Taxes, Fuel Charge and Air Travellers Security Charge.

Physical address

Provide the address of the physical location of the premises for which the return is being filed. If the return being filed is a consolidated return for more than one premises, provide the physical location of the filing account. If the physical address of the business has changed, you need to contact your CRA regional excise office to report the change.

Type of return

If you are filing a return for a reporting period for which you already have submitted a return, select "Amended." Otherwise, select "Original."

Reporting period

Identify the start and end dates of the calendar month for which the return is being filed. If the return does not cover a full calendar month because you received or cancelled your licence partway through a calendar month, enter the start and end dates that cover your operations for that particular calendar month.

Instructions for Section 2: Cannabis product inventory – Unpackaged

Details for each unpackaged product should be reported in this section in the unit of measure (kg/units/mg). The ending inventory reported should match the physical ending inventory. There may be situations where a cannabis licensee owns the cannabis and it is reported in inventory, but it is not actually in their possession. The licensee's books and records should support these situations for verification, for example, cannabis products that have been transferred to a third party for sterilization purposes.

Inventories of all cannabis products are shown in each column and are broken down by the type of cannabis product as follows:

Dried/Fresh cannabis – Flowering material

Flowering material means the whole or any part (other than viable seeds) of an inflorescence of a cannabis plant at any stage of development, including the infructescence stage of development. Inflorescence is commonly defined as a combination of the flowers and the ultimate small twigs of the branching system subtending the flowers. This includes what is commonly known in the industry as the bud and the small sugar leaves or other materials (bracts, stems, etc.). Inventories are to be reported in kilograms (kg).

Dried/Fresh cannabis – Non-flowering material

Non-flowering material means any part of a cannabis plant other than the flowering material, viable seeds and a part of the plant referred to in Schedule 2 to the Cannabis Act. Inventories are to be reported in kilograms (kg). Industrial hemp by-product is deemed to be non-flowering material and should therefore, be reported under this heading.

Note 

The reporting of unpackaged flowering material and non-flowering material inventory comprises both fresh cannabis (freshly harvested cannabis buds and leaves, not including plant materials that can be used to propagate cannabis) and dried cannabis (any part of the cannabis plant that has been subject to a drying process, other than seeds).

Whole cannabis plant

A whole cannabis plant is a cannabis plant that has begun producing reproductive structures, including flowers, fruits or seeds. Inventories are to be reported in units.

Viable seed

A viable seed means a viable seed of a cannabis plant that is not an industrial hemp plant. Inventories are to be reported in units.

Vegetative cannabis plant

A vegetative cannabis plant means a cannabis plant, including a seedling that has not yet produced reproductive structures, including flowers, fruits or seeds. This would include mother plants, clones, and micro-tissue cultures. Inventories are to be reported in units.

Pure intermediates

Pure intermediates are concentrates or resins produced by the extraction or other processing of flowering or non-flowering materials, that are then further processed into a cannabis extract, edible cannabis or cannabis topical product. Inventories of pure intermediates are to be reported in kilograms (kg).

Finished cannabis extracts

Cannabis extracts means cannabis products that are produced using extraction processing or other methods of synthesizing cannabinoids, and may contain carrier or stabilizing substances or flavouring agents. Inventories are to be reported in mg of total THC (mg) contained in the finished (i.e. ready for packaging) product.

Note 

Transactions that were previously reported as cannabis oil should now be reported as pure intermediates (when the resin used to produce the oil is taken for further processing into finished cannabis oil) or finished cannabis extracts (when the cannabis oil product that will be packaged has been produced and would be ready for packaging).

Finished edible cannabis

Edible cannabis means products containing cannabis that are intended to be consumed in the same manner as food (i.e. eaten or drunk). Inventories are to be reported in mg of total THC (mg) contained in the finished (i.e. ready for packaging) product.

Finished cannabis topicals

Cannabis topicals are products that include cannabis as an ingredient, which are intended to be used on external body surfaces (i.e. skin, nails and hair). Inventories are to be reported in mg of total THC (mg) contained in the finished (i.e. ready for packaging) product.

Opening inventory (line A)

The opening inventory of unpackaged cannabis products on the return must equal the last calendar month's closing inventory for each respective product. Enter amounts for "Opening inventory" under the applicable columns of line A.

Additions to unpackaged inventory

Total production

Enter the total quantity of cannabis products produced during the reporting period for each applicable category of product and in the corresponding unit of measure (kg/units/mg).

Flowering material

All flowering material that has been harvested should be included as an addition to inventory under "Total production." For example, 1 kg of fresh flowering material is harvested from whole cannabis plants and introduced to the drying process. You should enter 1.000 kg as an addition to the inventory of total production under flowering material.

Non-flowering material

All non-flowering material that has been harvested from a whole or vegetative cannabis plant for further processing or packaging is to be included as "Total production."

Viable seed

All viable seeds that are produced during a calendar month should be reported as "Total production."

Vegetative cannabis plant

All vegetative cannabis plants, including clones, root cuttings, tissue cultures and seedlings produced during the calendar month should be reported as "Total production."

Pure intermediates

All pure intermediates produced during the calendar month through extraction or other processes from the cannabis plant, including industrial hemp by-product, should be reported as "Total production." Inventories should not include any carrier, stabilizing or flavouring agents added to the amounts of pure intermediates produced.

Finished cannabis extracts

All finished cannabis extracts that are produced during a calendar month should be reported as "Total Production."

Finished edible cannabis

All finished edible cannabis products that are produced during a calendar month should be reported as "Total Production."

Finished cannabis topicals

All finished cannabis topicals that are produced during a calendar month should be reported as "Total Production."

Quantity received in Canada

Enter the total quantity of cannabis products received in Canada from other cannabis licensees or industrial hemp by-product received from an industrial hemp grower during the reporting period for each applicable category of product and in the corresponding unit of measure (kg/units/mg). Industrial hemp by-product should be reported as non-flowering material.

Quantity imported into Canada

Enter the total quantity of cannabis products imported into Canada during the reporting period for each applicable category of product and in the corresponding unit of measure (kg/units/mg).

Quantity transferred from vegetative cannabis plant

Enter the total quantity of additions to the "Whole cannabis plant" category during the reporting period from the "Vegetative cannabis plant" category, in units. These would be the plants that are ready to enter into the flowering phase of the cultivation process. For example, 50 vegetative cannabis plants are either physically moved to a separate flowering room, or the light cycle is changed to promote flowering. You would add 50 plants as an addition to inventory on the "Quantity transferred from vegetative cannabis plant" line, with a similar reduction to inventory of 50 plants on the "Quantity transferred to whole cannabis plant" under the vegetative cannabis plant column.

Note

This addition will only apply to the "Whole cannabis plant" category and should equal the reduction to the Vegetative cannabis plant category in "Quantity transferred to whole cannabis plant."

Total additions to unpackaged inventory (line B)

Add the quantities in each column (that is, under "Additions to inventory") and enter the sums on line B.

Reductions to unpackaged inventory

Quantity packaged

Enter the total quantity of cannabis products packaged during the reporting period for each applicable category of product in the corresponding unit of measure (kg/units/mg). Cannabis products are considered to be packaged when they are placed in the smallest consumer package (including any outer wrapper, package, box or other container) with all required labels affixed, and that are ready for sale to a consumer. Products do not require application of the cannabis excise stamp to be considered packaged.

For example, 50 kg of dried cannabis produced from flowering material is packaged into 1 g containers that are ready for sale to a consumer (with or without the cannabis excise stamp applied). This would be reported as a 50.000 kg reduction to flowering material on this line. Similarly, 200 containers of cannabis extract each containing 200 milligrams (mg) of total THC packaged for sale would be reported as a 40,000 mg reduction to finished cannabis extracts on this line.

Cannabis products that are in any intermediate stage of the packaging process (until placed into the final consumer container, fully labelled) are considered to be unpackaged, and will not be reported as quantity packaged until such time they are fully packaged and labelled for consumer sale.

Quantity taken for further processing or planted

Enter the total quantity of cannabis products taken for further production or planting during the reporting period for each applicable category of product and in the corresponding unit of measure (kg/units/mg).

Flowering material

All flowering material taken for use in the production process would be included as a reduction on this line. This would include flowering material taken to produce a pure intermediate that will be further processed into another cannabis product, for example edible cannabis. It would not include flowering material taken to produce a product that will be reported in the same category, for example milled product.

Non-flowering material

All non-flowering material taken for use in the production process would be included as a reduction on this line. This would include industrial hemp by-product taken to produce a pure intermediate that will be further processed into another cannabis product, for example edible cannabis. It would not include non-flowering material taken to produce a product that will be reported in the same category, for example milled product.

If the distinction between flowering and non-flowering material cannot be made, the product should be included as flowering material.

Viable seed

All seeds taken and planted should be reported as an inventory reduction under viable seeds on this line. For example, if 100 seeds are planted, 100 units should be reported under viable seeds on the "Quantity taken for further processing or planted" line.

Pure intermediates

All quantities of pure intermediates taken for use to produce cannabis extracts, edible cannabis or cannabis topicals would be included as a reduction on this line. For example, if 10 kg of cannabis resin are taken and mixed with carrier oil and flavouring to produce a cannabis extract, 10 kg should be reported under pure intermediates on the "Quantity taken for further processing or planted" line.

Plant harvested

Enter the total quantity of "Whole cannabis plants" harvested during the reporting period in units. For example, if 500 plants are harvested, a reduction of 500 should be reported as a reduction under "Whole cannabis plants" on the "Plant harvested" line.

Quantity delivered in Canada

Enter the total quantity of unpackaged cannabis products sold or delivered to other cannabis licensees during the reporting period for each applicable category of product and in the corresponding unit of measure (kg/units/mg).

Quantity exported outside Canada

Enter the total quantity of unpackaged cannabis products exported from Canada during the reporting period for each applicable category of product and in the corresponding unit of measure (kg/units/mg).

Note

Health Canada approvals/permits are required before any exportations can take place.

Quantity incurred as drying or processing loss

Enter, in kg or mg, the volume decreases for flowering and non-flowering material that are the direct result of any losses that occurred throughout the drying process or other processing (such as packaging) during the reporting period.

For example, if 1 kg of flowering material is harvested, and after drying, 100 g of flowering material remains, report 0.900 kg as a "Quantity incurred as drying or processing loss" under the flowering material category.

Quantity destroyed

Enter the total quantity of cannabis products destroyed during the reporting period for each applicable category of product and in the corresponding unit of measure (kg/units/mg).

Note

In accordance with subparagraph 158.3(a)(iv), the destruction of any cannabis product must be done in a manner that has been approved by the Minister.

Quantity sent for analysis

Enter the total quantity of cannabis products sent for analysis during the reporting period for each applicable category of product and in the corresponding unit of measure (kg/units/mg).

Note

Pursuant to subparagraph 158.3(a)(iii), any cannabis product sent for analysis must be done in a manner that has been approved by the Minister.

Quantity transferred to whole cannabis plant

Enter, in units, the total quantity of "Vegetative cannabis plants" that have entered the flowering phase of cultivation and have consequently been transferred to the "Whole cannabis plant" category during the reporting period. For example, 50 vegetative cannabis plants are either physically moved to a separate flowering room, or the light cycle is changed to promote flowering. You would add 50 plants as an addition to inventory on the "Quantity transferred from vegetative cannabis plant" line with a similar reduction to inventory of 50 plants on the "Quantity transferred to whole cannabis plant" under the vegetative cannabis plant column.

Note

This reduction would only apply to the "Vegetative cannabis plant" category and should equal the addition to the Whole cannabis plant category in "Quantity transferred from vegetative cannabis plant."

Quantity taken to produce low-THC cannabis products and prescription cannabis drugs

Enter the total quantity of cannabis products taken to produce low-THC products or prescription cannabis drugs during the reporting period for each applicable category of product and in the corresponding unit of measure (kg/units/mg).

Low-THC cannabis product means a cannabis product that consists entirely of fresh cannabis, dried cannabis or oil that contains anything referred to in item 1 or 3 of Schedule 3 to the Cannabis Act and that is in liquid form at a temperature of 22 degrees Celsius +/- 2 degrees Celsius, and any part of which does not have a maximum yield of more than 0.3% THC w/w, taking into account the potential to convert delta-9-tetrahydrocannabinolic acid into THC, as determined in accordance with the Cannabis Act.

Prescription cannabis drug means a cannabis product that is a drug that has been assigned a drug identification number under the Food and Drug Regulations, other than a drug or mixture of drugs that may, under the Food and Drugs Act or the Controlled Drugs and Substances Act, be sold to a consumer, as defined in subsection 123(1) of the Excise Tax Act (ETA), without a prescription, as defined in section 1 of Part I of Schedule VI to the ETA.

For example, 1 kg of industrial hemp by-product is taken to produce cannabis oil with 0.3% THC. You should report 1.000 kg as a reduction of non-flowering material on the "Quantity taken to produce low-THC cannabis products and prescription cannabis drugs" line.

Other

Enter the total quantity for reductions that do not fall into any of the above categories for reductions to unpackaged inventory that occurred in the reporting period for each applicable category of product and in the corresponding unit of measure (kg/units/mg).

Total reductions to unpackaged inventory (line C)

Add the quantities in each column (that is, under "Reductions to inventory") and enter the sums on line C.

Inventory adjustments (line D)

Adjustments may be necessary to balance the physical inventory with the book inventory. The closing or book inventory must agree with the physical inventory for the reporting period. All adjusting entries are subject to audit and must be entered as "Inventory adjustments" on line D.

Closing inventory

The closing inventory is the sum of lines A and B, minus line C, plus or minus any adjustments on line D, and the result is entered on this line:

(A + B) – C ± D

The closing inventory of unpackaged cannabis products will become the opening inventory for the following reporting period.

Instructions for Section 3: Cannabis product inventory – Packaged

This section is to be completed only by licensees who are packaging cannabis products for sale to consumers. Cannabis products are considered packaged when they are placed in the smallest consumer package (including any outer wrapper, package, box or other container) containing all required labels, and that are ready for sale to a consumer. Products do not require application of the cannabis excise stamp to be considered packaged.

This does not include licensees who are packaging low-THC cannabis products and prescription cannabis drugs. If you are not packaging cannabis products for sale to consumers you can proceed to section 6 on page 12 of the return.

Opening inventory (line E)

The opening inventory of packaged cannabis products on the return must equal the last calendar month's closing inventory for each respective cannabis product. Enter amounts for "Opening inventory" in the applicable columns of line E.

Additions to packaged inventory (line F)

Enter the total quantity of cannabis products packaged into final fully labelled consumer packaging that is ready for sale during the reporting period for each applicable category of product and in the corresponding unit of measure (kg/units/mg). Packaged flowering material and non-flowering material amounts are combined and reported as "Additions to inventory" under Dried/Fresh cannabis, while "Additions to inventory" for cannabis extracts, edible cannabis and cannabis topicals should be equal to the amounts reported as "Quantity packaged" in section 2 of the return.

For example, 200 bottles of cannabis oil, each containing 200 milligrams (mg) of total THC are packaged. On the "Additions to inventory" line, 40,000 mg should be reported under "Cannabis extracts". Similarly, if 50 kg of dried cannabis produced from flowering material is packaged in 2 g containers, then 50.000 kg should be reported under "Dried/Fresh cannabis" on the "Additions to inventory" line.

Reductions to packaged inventory

Quantity delivered to a purchaser in Canada

Enter the total quantity of packaged cannabis products that have been stamped and delivered to a purchaser in Canada during the reporting period for each applicable category of product and in the corresponding unit of measure (kg/units/mg).

For example, if 500 packages of an edible cannabis product, each with 6 mg of total THC, are delivered to a purchaser, then 3,000 mg should be reported as a reduction under "Edible cannabis" on the "Quantity delivered to a purchaser in Canada" line.

Quantity destroyed

Enter the total quantity of packaged cannabis products destroyed during the reporting period for each applicable category of product and in the corresponding unit of measure (kg/units/mg).

For example, if 10 containers of a cannabis topical, each containing 600 mg of total THC, are found to be subject to a recall and the cannabis topical in the 10 containers is destroyed, then 6,000 mg should be reported as a reduction under "Cannabis topicals" on the "Quantity destroyed" line.

Note

The destruction of any cannabis product must be done in a manner that has been approved by the Minister.

Other

Enter the total quantity of reductions that do not fall into any of the above categories for reductions to packaged inventory that occurred in the reporting period for each applicable category of product and in the corresponding unit of measure (kg/units/mg).

Total reductions to packaged inventory (line G)

Add the quantities in each column (that is, under "Reductions to inventory") and enter the sums on line G.

Inventory adjustments (line H)

Adjustments may be necessary to balance the physical inventory with the book inventory. The closing or book inventory must agree with the physical inventory for the reporting period. All adjusting entries are subject to audit and must be entered as "Inventory adjustments" on line H.

Closing inventory

The closing inventory is the sum of lines E and F, minus line G, plus or minus any adjustments on line H, and the result is entered on this line:

(E + F) – G ± H

This closing inventory of packaged cannabis products will become the opening inventory for the following reporting period.

Instructions for Section 4: Cannabis excise stamp inventory

This section requires an inventory reconciliation of the cannabis excise stamps for each reporting period. Inventory reporting is required to be conducted based on the jurisdiction of the stamp (that is, the province/territory). For more information regarding cannabis excise stamps, see Excise Duty Notice EDN54, General Overview of the Cannabis Excise Stamps.

Opening inventory (column A)

The opening stamp inventory on the return must equal the last calendar month's closing inventory for each jurisdiction. Enter amounts for "Opening inventory" for each jurisdiction.

Stamps received (column B)

Enter the quantity of cannabis excise stamps issued to you by the authorized cannabis excise stamp provider in this column, for each applicable jurisdiction.

Stamps used for products (column C)

Enter the quantity of stamps affixed to cannabis products during the reporting period in this column for each jurisdiction.

Unusable stamps (column D)

Enter the quantity of stamps that became unusable during the reporting period in the column, for each jurisdiction. These stamps must be retained in order to be verified by an excise duty officer. This could include stamps that became unusable as a result of the application of adhesive by either the licensee or a third-party provider.

Inventory adjustments (column E)

Adjustments may be necessary to balance the physical inventory with the book inventory. The closing or book inventory must agree with the physical inventory for the reporting period. All adjusting entries are subject to audit and must be entered as "Inventory adjustments" in column E.

Closing inventory (column F)

The closing inventory is the sum of columns A and B, minus columns C and D, plus or minus any adjustments in column E, and the results for each respective jurisdiction are entered in this column F:

A + B – C – D ± E

This closing inventory of cannabis excise stamps will become the opening inventory for the following reporting period, for each respective jurisdiction.

Instructions for Section 5: Calculation of the sales and duty payable

This section consists of subsections that must be completed for each category of cannabis product as detailed below. For each category of cannabis product sold in the reporting period, enter the following amounts in the applicable column for each jurisdiction:

  • total sales in dollars, quantity (kg/units/mg) and packages
  • the total amount of duty, additional duty and adjustment to the additional duty (if applicable) payable

For additional information on the imposition and payment of excise duty on cannabis products, see Excise Duty Notice EDN53, General Information for Cultivators, Producers and Packagers of Cannabis Products, Excise Duty Notice EDN55, Calculation of Cannabis Duty and Additional Cannabis Duty on Cannabis Products and Excise Duty Notice EDN60 Calculation of Cannabis Duty and Additional Cannabis Duty on Cannabis Oil, Edible Cannabis, Cannabis Extracts and Cannabis Topicals.

Calculation of total net amount

Cannabis duty payable (line 19)

The cannabis duty payable for all cannabis products sold and delivered during the reporting period is the sum of lines 1 to 6, and this amount is entered on line 19.

Additional cannabis duty payable (line 20)

The total additional cannabis duty payable for all cannabis products sold and delivered during the reporting period is the sum of lines 7 to 12, and this amount is entered on line 20.

Adjustment to the additional cannabis duty payable (line 21)

The total adjustment to the additional cannabis duty payable for all cannabis products sold and delivered during the reporting period is the sum of lines 13 to 18, and this amount is entered on line 21.

Total (line 22)

The total is the sum of the cannabis duty payable (line 19), additional cannabis duty payable (line 20), and adjustment to the additional cannabis duty payable (line 21) during the reporting period:

line 19 + line 20 + line 21 = line 22

Refund (line 23)

Enter the amount reported on line 4 of Form B301, Application for a Refund of Cannabis Duty on line 23. Form B301 must be attached to Form B300.

Net amount (line 24)

Enter the net amount due by subtracting line 23 from line 22.

Instructions for Section 6: Certification

An authorized person must print their name and title, sign and date the return, and provide a current telephone number. Enter the complete name and telephone number of a person who may be contacted about the cannabis duty and information return.

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