The HST Is Imminent!
Posted by Dee Dutton on Wed, May 19, 2010 @ 11:34 AM
The BC HST is imminent! Are you prepared? Do you know the supply and transition rules for your business? Do you know the reporting requirements, especially in relation to the transition period?
I participated in an HST Webinar presented by the CRA today. There was a lot of valuable information and they covered many of these important topics. The CRA also provided a slide show document as well as a reference document that links to specific documents on their website. All the pertinent information can be found on CRA's website at http://www.cra-arc.gc.ca/gncy/hrmnztn/menu-eng.html but I have mentioned some of the topics covered during the webinar below;
Key Dates
- May 1, 2010
- Date that HST would generally apply to amounts that become due or are paid, without having become due for property and services, supplied on or after July 1, 2010
- July 1, 2010-Implementation Date
- Date that HST would generally begin to apply
- November 1, 2010
- Date relevant to exchanges, returns and self-assessment
Changes to Place of Supply
- There is now less reliance on the suppliers' location and a greater reliance on where the consumer of the intangible personal property or service is located
Transitional Rules
- HST would apply when goods are delivered and ownership is transferred on or after July 1, 2010 and consideration becomes due or is paid without having become due on or after May 1, 2010.
- HST would not apply when ownership is transferred or the good is delivered before July 1, 2010 regardless of when consideration becomes due or is paid without having become due.
Exchanges & Returns of Goods
- Special rules apply to exchanges made on or after July 1, 2010 and before November 1, 2010 for goods purchased before July 1, 2010.
- Exchanged good exceeds what was paid for the original good, then the HST would apply to the difference; and
- Exchanged good is less than or equal to that paid for the original good, then the HST would not apply.
- HST would apply to all exchanges on or after November 1, 2010.
Services - General Rule
- HST would apply to any consideration due or paid on or after May 1, 2010, for a supply of a service, when the consideration relates to the portion of the service performed on or after July 1, 2010.
- For Example: A landscaping service for June and July 2010. 40% of the service is performed in June 2010. It was invoiced in August 2010.
- HST would apply to 60% -the July portion
- GST would apply to 40% -the June portion
- If 90% or more of the service is performed before July 2010, no HST would be payable on the amount for the service.
Other topics covered include:
- Intangible Personal Property
- Sales to Government
- Indian/Indian Bands
- Leases & Licenses
- Services - Special Rules
- Reporting
You can sign up for these webinars (there are 3 left) yourself or view webcasts at: http://www.cra-arc.gc.ca/gncy/hrmnztn/menu-eng.html