New Proposed HST Place of Supply Rules

I am not a fan of GST.  Not because I don't like tax - but because it is not logical.  How and when you charge GST does not always make sense - you have to confirm everything to be sure.

Well, now BC and Ontario are moving to the HST on July 1, 2010 (which will likely happen regardless of Mr. VanderZalm's efforts).

So the Minister of Finance has come out with some tentative rules on place of supply for HST to make things "easier" for GST registrants.

Remember that these rules are tentative - MOF is awaiting comments. . . but here's what at stake so far for consulting services.

If the supplier of the services has obtained a recipient's address in Canada, the supply will be considered to be at that address.

If there is no address in Canada, it will be where the services are primarily (more than 50%) performed.  If performed equally in two or more provinces it will be considered to be in the one with the higher rate of HST.

If the services are location specific (i.e. at a convention centre) - then they will be considered to be supplied at that location.

Of course, computer-related services are slightly different.  Those are considered to be supplied where the person who acquires the service is ordinarily located.

The main thing that was removed in all of the proposed new rules is the negotiation aspect.  That is good news  - if these rules go forward, it is the services themselves that matter not where the contract was signed.


And, of course, all of the above might be overridden if the services are supplied with tangible or intangible personal property - this is why the GST/HST drives me crazy.