GST/HST rates and place-of-supply rules

Example 1

A store in Ontario agrees to sell goods to a purchaser in Prince Edward Island. Based on the terms of delivery in the agreement for the sale of the goods, legal delivery of the goods to the purchaser occurs in Prince Edward Island. The place of supply is Prince Edward Island (a participating province) and the HST will apply at the Prince Edward Island rate.

Example 2

A store in Alberta agrees to sell goods to a purchaser in Ontario. Based on the terms of delivery in the agreement for the sale of the goods, legal delivery of the goods to the purchaser occurs in Alberta. However, the supplier agrees to have the goods shipped to the purchaser in Ontario. Although legal delivery of the goods to the purchaser occurs in Alberta, delivery of the goods to the purchaser is considered to occur in Ontario because the supplier ships the goods to an address in Ontario. The place of supply is Ontario (a participating province) and the HST will apply at the Ontario rate.

An individual rents a video camera from a store in Truro, Nova Scotia, to use while traveling across Canada. The rental agreement is for 6 weeks. The place of supply is Nova Scotia (a participating province) and the HST will apply on the rental price at the Nova Scotia rate.

A national leasing company leases a photocopier to a consulting firm in New Brunswick for a four-year period. Under the lease agreement, monthly lease payments are required. At first, the photocopier is located at the firm's office in New Brunswick. At the end of the third monthly lease interval, the firm, with the agreement of the leasing company, moves the photocopier to their new office in Manitoba. The place of supply is New Brunswick (a participating province) during the first 3 lease intervals and Manitoba (a non-participating province) during the fourth lease interval, therefore the HST will apply at the New Brunswick rate for the first 3 lease intervals and the GST will apply for the fourth lease interval.

A car leasing company in Nova Scotia leases a vehicle to an individual according to a two-year lease requiring monthly lease payments. The lessee picks up the vehicle at the supplier's location in Nova Scotia and the vehicle is required to be registered in Nova Scotia throughout the lease. The place of supply of the vehicle for each separate lease interval is Nova Scotia (a participating province) and the HST will apply at the Nova Scotia rate to each lease payment since the car is required to be registered in Nova Scotia throughout the lease.

A supplier in Quebec agrees to design the website of a company in Ontario. The service is performed entirely in Quebec. The business address of the recipient obtained by the supplier is in Ontario. Since the business address of the recipient is in Ontario, the place of supply is Ontario (a participating province) and the HST will apply at the Ontario rate.

Example 1 – Rule 2a – Canadian part not performed primarily in participating provinces

A business in Alberta specializes in website production and marketing services. Employees perform these services from the business address in Alberta. They receive and send all documents through email. They do not obtain an address for their clients.

Since the Canadian element of the service is not performed primarily in participating provinces, the place of supply will be that non-participating province (Alberta) and the GST will apply to the services.

Example 2 – Rule 2b – Participating province of largest proportion

A business in Nova Scotia specializes in providing online editing and translation services. Employees perform these services from the business address in Nova Scotia. They receive and send all documents through email. They do not obtain an address for their clients.

Since the Canadian element of the service is performed primarily in participating provinces, and the participating province where the largest proportion of that service is performed is Nova Scotia, the place of supply is Nova Scotia (a participating province) and the HST will apply at the Nova Scotia rate.

Example 1 – Personal service rule 1 – Primarily in participating provinces

An individual gets his hair cut at a salon in Fredericton, New Brunswick. The place of supply is New Brunswick (a participating province) and the HST will apply at the New Brunswick rate.

Example 2 – Personal service rule 2 – Not primarily in a participating provinces

An individual gets a pedicure at a spa in Regina, Saskatchewan. The place of supply is Saskatchewan (a non-participating province) and the GST will apply to the service.

You hire a repair person to fix a washing machine at your home in Cornwall, Ontario. The place of supply is Ontario (a participating province) and the HST will apply to the service at the Ontario rate.

You hire a national company to provide appliance repair services for a flat fee, for appliances located in 3 provinces as follows:

• 40% in Ontario
• 40% in New Brunswick
• 20% in Alberta  

The appliances are located primarily in participating provinces (80%) and the largest proportions of those appliances are located in Ontario and New Brunswick. Since the HST rate in New Brunswick is the highest, the place of supply is New Brunswick (a participating province) and the company will charge the HST at the New Brunswick rate.

You are a company and you hire another company to conduct tests on a vehicle. The service is performed as follows:

• 60% in Ontario
• 40% in Manitoba

The vehicle is located in Ontario when the Ontario part of the service is performed and in Manitoba when the Manitoba part of the service is performed. The vehicle is moved from Ontario to Manitoba after the Ontario part of the service is performed. The vehicle is located primarily in participating provinces when the Ontario part of the service is performed and the service as a whole is performed primarily in participating provinces, the largest proportion of which is performed in Ontario. The place of supply is Ontario (a participating province) and the HST will apply at the Ontario rate.

You are a company and you hire another company to conduct tests on a vehicle. The service is performed as follows:

• 60% in Manitoba
• 40% in Ontario

The vehicle is located in Manitoba when the Manitoba part of the service is performed and in Ontario when the Ontario part of the service is performed. The vehicle is moved from Manitoba to Ontario after the Manitoba part of the service is performed. While the vehicle is located primarily in participating provinces when the Ontario part of the service is performed, the service as a whole is not performed primarily in participating provinces. The place of supply is Manitoba (a non-participating province) and the GST will apply to the service.

You hire a Quebec company to paint your warehouse in Ontario. The place of supply is Ontario (a participating province) because the real property located in Canada to which the service relates is 100% in Ontario. The Quebec company will charge the HST at the Ontario rate on its supply of painting services.

You have a contract to supply window cleaning services for real property located in 2 provinces as follows:

•     25% in Nova Scotia
•     75% in Alberta

The real property is not located primarily in participating provinces. The place of supply is Alberta (a non-participating province). The GST will apply to your window cleaning services.

You have a contract to supply landscaping services for real property located in 3 provinces as follows:

•    40% in Alberta
•    35% in Prince Edward Island
•    25% in Ontario

Even though the highest single percentage of the real property is located in a non-participating province (Alberta), the combined percentages of the 2 participating provinces make the real property located primarily in participating provinces. Of those participating provinces, the largest proportion of the real property is located in Prince Edward Island. The place of supply is Prince Edward Island (a participating province) and the HST will apply at the Prince Edward Island rate.

You supply property management services in relation to real property located in 3 provinces as follows:

•    40% in New Brunswick
•    40% in Prince Edward Island
•    20% in Alberta

The real property is located primarily in participating provinces. There is no participating province with the largest proportion of the real property since the largest proportions in those provinces are located equally in New Brunswick and Prince Edward Island. Since New Brunswick and Prince Edward Island (both participating provinces) have the same HST rate, you will charge that rate for your property management services.

The place of supply for air navigation services (as defined in subsection 2(1) of the Civil Air Navigation Services Commercialization Act) is a province if the leg of the flight during which the services are performed originates in that province.

For this place-of-supply rule, leg means a part of a flight of an aircraft that begins where passengers embark or disembark the aircraft, where freight is loaded on (or unloaded from) the aircraft, or where the aircraft is stopped to allow for its servicing or refuelling, and that ends where it is next stopped for any of those purposes.

The place of supply for computer-related services and internet access depends on whether the supply is made to a single final recipient or multiple final recipients.

These rules override other place-of-supply rules that could otherwise apply to the supplies of computer-related services and internet access. For example, a supply of internet access is a supply of a telecommunication service. However, the place-of-supply rules explained in this "Computer-related services and internet access" section override the place-of-supply rules for telecommunication services (for the supply of internet access).

Single final recipient

If the supplier supplies a computer-related service or internet access to a single final recipient who acquires the supply under an agreement (with that supplier or another supplier), the place of supply is the province where the final recipient avails itself of the service or access at a single ordinary location, if either of the following conditions are met:

• The supplier has sufficient information to determine that location.
• It is the supplier's normal business practice to obtain sufficient information to determine that location.

In any other case where there is to be a single final recipient, the place of supply is the province of the mailing address of the recipient of the supply.

Multiple final recipients

Computer-related services

If the following 3 conditions are met, the supplier uses the general place-of-supply rules for services as if the service were performed in each province in which, and to the same extent to which, the final recipients avail themselves of the service.

1. There are to be multiple final recipients of the service.
2. Each final recipient acquires the supply under an agreement (with either that supplier or another supplier).
3. In the case of each final recipient, there is a single location at which the final recipient avails itself of the service, and either the supplier has sufficient information to determine that location, or it is their normal business practice to obtain that information.

In any other case where there are to be multiple final recipients of the supply, the place of supply for the computer-related service would be the province of the mailing address of the recipient.

Internet access

If the following 3 conditions are met, the supplier uses the place-of-supply rules for intangible personal property as if the internet access were accessible in each province in which, and to the same extent to which, the final recipients avail themselves of the internet access.

1. There are to be multiple final recipients of the internet access.
2. Each final recipient acquires the supply under an agreement (with either that supplier or another supplier).
3. In the case of each final recipient, there is a single location at which the final recipient avails itself of the access, and either the supplier has sufficient information to determine that location, or it is their normal business practice to obtain that information.

In any other case where there are to be multiple final recipients of the supply, the place of supply for the internet access will be the province of the mailing address of the recipient.

A customs brokerage service means a service of arranging for the release of imported goods or of fulfilling, for the importation, any requirement under the Customs Act or the Customs Tariff to account for the goods, to report, to provide information or to remit any amount.

The place of supply for a customs brokerage service for imported commercial goods is the province where the goods are located at the time of their release.

However, the place of supply for a customs brokerage service for imported non-commercial goods is a participating province if the provincial part of the HST meets either of the following conditions:

• It is imposed on the importation of the goods at the rate for that participating province.
• It would be imposed if various provisions did not apply to relieve certain types of importations from the imposition of the provincial part of the HST.

Relieving provisions apply to:

• imported goods accounted for as commercial goods, imported specified motor vehicles or imported mobile homes or floating homes that have been used or occupied in Canada by any individual
• certain goods imported by or on behalf of persons who are resident in the Nova Scotia offshore area or the Newfoundland offshore area
• imported goods that qualify as non-taxable importations from the imposition of the GST or federal part of the HST

In any other case, the place of supply for the customs brokerage service is a non-participating province.

The above rules do not apply to the supply of, or request for, any service related to:

• an objection
• an appeal
• a re-determination
• a re-appraisal
• a review
• a refund
• an abatement
• a remission
• a drawback

The place of supply for a freight transportation service is a province if the destination of the service is in that province. This rule does not apply to most supplies of mail services supplied by the Canada Post Corporation which are subject to the place-of-supply rules that are explained in the section dealing with postage and mail delivery services. For more information, see Find out how the GST/HST applies to freight transportation services.

The place of supply for a passenger transportation service is a participating province if that service is provided as part of a continuous journey, a ticket or voucher is issued for the particular passenger transportation service provided first in that continuous journey, and either of the following conditions are met:

• The ticket or voucher specifies the origin of the continuous journey, which is a place in the participating province, and the termination of, and all stopovers during, the continuous journey are in Canada.
• The ticket or voucher does not specify the origin of the continuous journey, but the particular passenger transportation service cannot begin otherwise than in that participating province, and the termination of, and all stopovers during, the continuous journey are in Canada.

The place of supply for a passenger transportation service is also a participating province if that service is not part of the continuous journey, but it begins in that participating province and ends in Canada.

The place of supply for a passenger transportation service is a non-participating province if that service is provided as part of a continuous journey, a ticket or voucher is issued for the particular passenger transportation service provided first in that continuous journey, and any of the following conditions are met:

• The ticket or voucher specifies the origin of the continuous journey, which is a place outside the participating provinces.
• The ticket or voucher does not specify the origin of the continuous journey, but the particular passenger transportation service cannot begin in a participating province.
• The termination of (or a stopover during) the continuous journey is outside Canada.

The place of supply for the passenger transportation service is also a non-participating province if that service is not part of a continuous journey, but it begins outside the participating provinces or ends outside Canada.

Supplies made during passenger transportation services

Supplies made during an international flight or international voyage

If a supply of tangible personal property or a service (other than a passenger transportation service) is made to an individual on board an aircraft on an international flight or a vessel on an international voyage and physical possession of the property is transferred to the individual (or the service is wholly performed) on board the aircraft or vessel, the place of supply is considered to be outside Canada and is therefore not subject to GST/HST.

Supplies made other than during an international flight or international voyage

If a supply of property or a service (other than a passenger transportation service) is made to an individual on board a conveyance in the course of supplying passenger transportation services and the property or service is delivered, performed, or made available on board the conveyance during any leg of a journey that begins in any province and ends in any province, the place of supply is the province where that leg of the journey begins.

Services related to the supply of passenger transportation services

Baggage charges

The place of supply for the service of transporting an individual's baggage in connection with a passenger transportation service is, if made by the supplier of the passenger transportation service, the same province in which the supply of the passenger transportation service is made.

Child supervision

The place of supply for the service of supervising an unaccompanied child in connection with a passenger transportation service is, if made by the supplier of the passenger transportation service, the same province in which the supply of the passenger transportation service is made.

Services related to a ticket, voucher or reservation

The place of supply for the service of issuing, delivering, amending, replacing or cancelling a ticket, voucher or reservation for a passenger transportation service, made by the supplier of the passenger transportation service, is the same province in which the supply of the passenger transportation service is made, if the passenger transportation service had been completed in accordance with the agreement for that supply.

The place of supply for a right to a mail delivery service, as evidenced by a postage stamp or a postage-paid card, package or similar item (other than an item bearing a "business reply" indicia) that is authorized by the Canada Post Corporation, is the province in which the supplier delivers the stamp or item to the recipient.

The place of supply for a mail delivery service, for which the postage stamp, postage-paid card, package or similar item is used as evidence of the payment of postage for the mail delivery service, is the province in which the stamp or item is delivered. However, this rule does not apply in circumstances where either of the following conditions are met:

• The supply of the service is made under a bill of lading.
• The consideration for the supply of the service is $5 or more and the address to which the mail is sent is not in a participating province.

In either of these circumstances, the place-of-supply rules as explained in the freight transportation services section determine the place of supply for the mail delivery service. As a result, the place of supply for the mail delivery service in these circumstances would be a province if the destination of the service is in that province.

There is a separate place-of-supply rule that applies to the goods that are delivered and to which the mail delivery service relates. For more information, see Goods and other tangible personal property.

Postage meter

If the payment of postage for a mail delivery service supplied by the Canada Post Corporation, otherwise than under a bill of lading, is evidenced by a postage meter impression printed by a meter, the place of supply for the service is a province if the ordinary location of the meter is in that province when the recipient of the supply pays an amount to the Corporation for that postage. The ordinary location of the meter at a particular time is the location the supplier and the recipient mutually agree is the ordinary location of the meter at that time. The ordinary location may change from time to time.

If the supply is made under a bill of lading, the general place-of-supply rule for freight transportation services applies. As a result, the place of supply would be a province if the destination of the service is in that province.

Permit imprint

If the payment of postage for a mail delivery service supplied by the Canada Post Corporation, otherwise than under a bill of lading, is evidenced by a permit imprint, the place of supply is the province in which the recipient of the supply deposits the mail with the Corporation in accordance with the agreement between the recipient and the Corporation authorizing the use of the permit imprint.

If the supply is made under a bill of lading, the general place-of-supply rule for freight transportation services applies. As a result, the place of supply would be a province if the destination of the service is in that province.

Business indicia

If an item bearing a "business reply" indicia is used, the place-of-supply rule for freight transportation services applies. As a result, the place of supply would be a province if the destination of the service is in that province.

The place of supply for a service provided by telephone and accessed by calling a number beginning with 1-900 or 976 is the province in which the telephone call originates.

The general rules for supplies of services will not apply to the supply of a service that relates to a location-specific event (for example, a performance, festival, ceremony, convention, conference, symposium, or other similar event) if the service is performed primarily (more than 50%) at a location of the event in a province. The place of supply of such a service will be the province in which the service is primarily performed.

The place of supply for a service for a trust governed by an RRSP, an RRIF, an RESP, an RDSP or a TFSA provided by a trustee of the trust is a province if the mailing address of the annuitant of the RRSP or RRIF, of the subscriber of the RESP or of the holder of the RDSP or TFSA is in that province.

For purposes of this place-of-supply rule, the following are as defined in subsection 248(1) of the Income Tax Act:

• RRSP means a registered retirement savings plan
• RRIF means a registered retirement income fund
• RESP means a registered education savings plan
• RDSP means a registered disability savings plan
• TFSA means a tax free savings account

The general place-of-supply rules for services will not apply to a service rendered in connection with criminal, civil or administrative litigation in a province. The place of supply for a service that is rendered in connection with criminal, civil or administrative litigation in a province (other than a service rendered before the commencement of such litigation), is that province. A supply of such a service rendered before the commencement of such litigation is subject to the general place-of-supply rules for services.

The place of supply for a telecommunication service of making telecommunications facilities available (other than a service of granting sole access to a telecommunications channel) is the province where all of the facilities are ordinarily located. Where not all of the facilities are ordinarily located in that province, the place of supply is a province if the invoice for the supply is sent to an address in that province.

For other types of supplies of telecommunication services (other than a service of granting sole access to a telecommunications channel), the place of supply is a province if the telecommunication:

• is both emitted and received in that province
• is either emitted or received in that province and the billing location for the service is located in that province
• is emitted in that province and received outside that province and the billing location for the service is not in the province where the telecommunication is emitted or received

Billing location

For purposes of the place-of-supply rules that determine the province in which a supply of a telecommunication service is made, the billing location for a telecommunication service is in a province if the fee for the service is charged or applied to an account that the recipient has with the supplier of the service, the account relates to telecommunications facilities that are used or are available for use by the recipient to obtain telecommunication services, and all of those facilities are ordinarily located in that province. Where, from time to time, the supplier and the recipient mutually agree on the ordinary location of the telecommunications facilities at a particular time, that location is considered to be the ordinary location of the telecommunication facilities at the particular time.

If the fee for the service is not charged or applied to an account that the recipient has with the supplier of the telecommunication service, the billing location is considered to be in a province if the telecommunications facility used to initiate the service is located in that province.

Dedicated telecommunications channel

A supply of a telecommunication service of granting sole access to a telecommunications channel for transmitting telecommunications between 2 provinces is considered to be a separate supply of the service made in each of those provinces as well as a separate supply in any province between them. The amount of consideration for the supply in each province is calculated based on the part of the overall distance over which the telecommunication will be transmitted that will occur in the particular province if the telecommunication were transmitted solely by means of cable and related facilities located in Canada that connected, in a direct line, the transmitters for emitting and receiving the telecommunications.

Where the relevant conditions have been met, this place-of-supply rule overrides the place-of-supply rule for supplies of services in relation to tangible personal property and the general place-of-supply rules for supplies of tangible personal property.

These specific place-of-supply rules apply where a person receives goods of another person for any of the following purposes:

• supplying a service of repairing, maintaining, cleaning, adjusting or altering the property
• producing a negative, transparency, photographic print or other photographic-related good

The place of supply for the service (and for any property supplied in connection with it) or for the photographic-related good is the province where the supplier delivers the property to the recipient after the service or production of the photographic-related good is completed.

For purposes of this rule, property is considered to be delivered in a particular province, and not in any other province, if the supplier does either of the following:

• ships the property to a destination in the province that is specified in the contract for carriage of the good or transfers possession of the property to a common carrier or consignee that the supplier has retained on behalf of the recipient to ship the property to such a destination
• sends the property by mail or courier to an address in the particular province

An individual buys a theatre pass in Quebec. The pass gives the individual the right to attend 7 plays in Quebec and 3 plays in New Brunswick. The place of supply is Quebec (a non-participating province) since the IPP can only be used primarily in Quebec. The GST will apply to the sale of the pass.

Company A company licences software to Company B in Ontario. The software is downloaded over the internet. The licence provides that the software can only be used from Company B's head office in Ontario.

The place of supply is Ontario (a participating province) because the Canadian rights for the software can only be used primarily in participating provinces and an equal or larger proportion of the Canadian rights cannot be used in a participating province other than Ontario. The HST will apply at the Ontario rate.

An individual buys a movie pass that provides 10 admissions to any of a movie chain's 5 theatres in Nova Scotia and New Brunswick. They pay less than $300 for the pass at one of the chain's New Brunswick locations.

The place of supply for the IPP is New Brunswick (a participating province) because the Canadian rights for the pass can only be used primarily in the participating provinces, the supply is made through a permanent establishment of the supplier in New Brunswick in the presence of an individual who is the recipient and the pass can be used in New Brunswick. The HST will apply at the New Brunswick rate.

Company A in New Brunswick licences software to Company B in Newfoundland and Labrador. The software is downloaded over the internet. The licence provides that the software can only be used from Company B's offices in Newfoundland and Labrador and New Brunswick. In the ordinary course of its business, the supplier only obtains a business address of the recipient that is in Newfoundland and Labrador. That address is also the billing address for the supply.

The place of supply is Newfoundland and Labrador (a participating province) because the Canadian rights for the software can only be used primarily in the participating provinces and, in the ordinary course of its business, the supplier only obtains a business address of the recipient that is in Newfoundland and Labrador. The HST will apply at the Newfoundland and Labrador rate.

A company in Nova Scotia supplies a Quebec business with intellectual property rights that can only be used in Nova Scotia and Ontario. The business address of the recipient obtained by the Nova Scotia company in the ordinary course of business is in Quebec. The Canadian rights for the IPP can only be used primarily in participating provinces. Although the supplier obtains the recipient's business address, that address is in Quebec which is a province where the IPP cannot be used.

The place of supply is Nova Scotia since it’s the participating province that has the highest tax rate of the participating provinces where the IPP can be used. The HST will apply at the Nova Scotia rate.

An individual bought a movie pass that provides 10 admissions to any of a popular movie chain's locations. The chain has at least 1 location in every Canadian province. The individual paid less than $300 for the pass at one of the chain's Ontario locations.

The place of supply for the IPP is Ontario (a participating province) because the Canadian rights for the pass are not limited to being used primarily (more than 50%) in participating provinces or primarily in non-participating provinces, the supply is made in the presence of the recipient through a permanent establishment of the supplier in Ontario and the IPP can be used in Ontario. The HST will apply at the Ontario rate.

A company in New Brunswick licences software to a business in New Brunswick. The software is downloaded over the internet. There are no restrictions on where the software can be used. In the ordinary course of its business, the supplier only obtains a business address of the recipient that is in New Brunswick. That address is also the billing address for the supply.

The place of supply is New Brunswick (a participating province) because the Canadian rights for the software are not limited to being used primarily in a participating province or a non-participating province. In the ordinary course of its business, the supplier only obtains a business address of the recipient in New Brunswick, and the IPP can be used in New Brunswick. The HST will apply at the New Brunswick rate.

An individual buys an air transportation pass in Ontario. The pass gives them unlimited travel between Ontario, Manitoba, Saskatchewan and Alberta. The supplier in Ontario does not obtain the individual's address.

The place of supply is Ontario because it’s the participating province that has the highest tax rate of the provinces where the IPP can be used, and the Canadian rights for the pass are not limited to being used primarily in a participating province or a non-participating province. The HST will apply at the Ontario rate.

For the topic of "IPP that relates to goods or other tangible personal property", we use the word goods to refer to all tangible personal property.

The previous general rules do not apply to supplies of IPP that relate to goods (such as the right to buy goods). For these supplies, the following place-of-supply rules apply.

For purposes of these rules, the ordinary location of the goods is considered to be the place the supplier and the recipient mutually agree on, even if the goods are actually located at a different place. The ordinary location would change if the supplier and recipient mutually agree on a different location. The ordinary location would be that new location.

Rule 1 – Ordinary location not primarily in participating provinces

The place of supply for IPP that relates to goods that are ordinarily located in Canada is a non-participating province if those goods are not ordinarily located primarily (more than 50%) in participating provinces.

Rule 2 – Ordinary location primarily in participating provinces

The place of supply for IPP that relates to goods is a participating province if the goods ordinarily located in Canada are ordinarily located primarily (more than 50%) in participating provinces, and an equal or larger proportion of the goods are not ordinarily located in any other participating province.

Rule 3 – Higher tax rate

If rule 2 does not determine the place of supply because the goods are ordinarily located in equal proportions in 2 or more participating provinces, the place of supply is the participating province out of those provinces where the tax rate is the highest. If 2 or more of those participating provinces have the same highest tax rate, the place of supply is one of those provinces.

The previous general rules do not apply to supplies of IPP that relate to real property. For these supplies, the following place-of-supply rules apply.

The place of supply for IPP that relates to real property is in Canada if that real property is located in Canada. The place of supply for IPP that relates to real property is outside Canada if the real property is located outside Canada. If the real property is located both in Canada and outside Canada, only the proportion of the supply that relates to the real property located in Canada is considered to be made in Canada.

To find out if a supply is considered to be a supply of real property instead of a supply of IPP that relates to real property, see GST/HST Technical Information Bulletin B-103, Harmonized Sales Tax – Place-of-supply rules for determining whether a supply is made in a province.

Rule 1 – Real property not located primarily in participating provinces

The place of supply for IPP that relates to real property is a non-participating province if the real property that’s located in Canada is not located primarily (more than 50%) in participating provinces. 

Rule 2 – Real property located primarily in participating provinces

The place of supply for IPP that relates to real property is a participating province if the real property located in Canada is located primarily (more than 50%) in participating provinces, and an equal or larger proportion of the real property is not located in any other participating province.

Rule 3 – Higher tax rate

If Rule 2 does not determine the place of supply because the real property is located in equal proportions in 2 or more participating provinces, the place of supply is the participating province out of those provinces where the tax rate is the highest. If 2 or more of those participating provinces have the same highest tax rate, the place of supply is one of those provinces.

These place-of-supply rules apply to a supply of IPP that is, or is similar to, a passenger transportation pass that gives an individual the right to one or more passenger transportation services.

The place of supply is a participating province if, at the time the supply is made, the supplier can determine that each passenger transportation service covered by the pass could only begin in that participating province and would terminate in Canada.

The place of supply is a non-participating province if, at the time the supply is made, the supplier can determine that each passenger transportation service covered by the pass could only begin in a non-participating province or would terminate outside Canada.

If the place of supply of the pass cannot be determined under these rules, the general place-of-supply rules for IPP would determine the place of supply of the pass.