Heather Weber

Will HST Legislation Changes Impact My Credit Union?

Wednesday, February 09, 2011 by Heather Weber


If you are considered as a Selected Listed Financial Institution (SLFI), you will be required to file a form known as the Special Attribution Method (form GST 494) for your upcoming fiscal year end. This form allocates the non recoverable GST / HST paid to the provinces where the SLFI has a Permanent Establishment, and determines if any additional tax is owing or recoverable.

This form is required to be filed once per year within three months of your fiscal year end, commencing for all fiscal year-ends after July 1, 2010.

Who is a Selected Financial Institution?

“Selected Listed Financial Institutions" (SLFIs), are defined as financial institutions which have operations in jurisdictions with different tax rates; participating provinces (HST Provinces) and non participating provinces.

Financial Institutions include:

  • Banks
  • Public Trustees
  • Credit Unions
  • Segregated Funds of an Insurer
  • A person whose principal business is lending money or purchase of securities or a combination of the two, trader or broker, insurer, an investment plan

To determine if you fit the above criteria, ask yourself the following?

Banks, Credit Unions, lending institutions
Do you have locations in an HST province and a non HST province?
Do you have account holders in more than one province? (HST and non HST)?
Do you have security in more than one province?

Do you have a Permanent Establishment in more than one province?
Is the Insurance Company a reinsurer? If so does it provide coverage of a risk in respect of property or persons in more than one province?

Trust and Loan Corporations
Do you have a Permanent Establishment in more than one province?
Do you have security (land) in more than one province?
Do you have loan recipients residing in more than one province (other than loans secured by land)?

Investment plans and Segregated Funds
Can contracts of the Segregated Fund be sold in more than one province?
If a Mutual Fund Trust, can you sell or distribute shares or units in more than one province?
If a pension entity, do you have members that reside in more than one province?

Specified Investors
An institutional Investor that is not a segregated fund is a specified investor if the value of their investments is less than 10 million on the attribution date - point in time when the fund determines its value.

Small Investment Plan
A RPP or employee benefit plan is a small investment plan if it has unrecoverable GST/HST of less than $10,000 and has not elected to be a SLFI.

If you answered yes to any of the above, you will be affected by the changes.

Next steps

The impact of the above is that many more financial institutions will be required to file Special Attribution Method (form GST 494) returns and those that were already required to file may be affected by the new calculation and options available. This area is very complicated and will vary depending on your unique circumstances.

If you are affected by these changes and require assistance, please contact a member of MNP’s Indirect Tax team as follows:

British Columbia
Heather Weber
Mitch LaBuick
Patty Hnidy
John Jeninga
Kal Ruprai

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