- The ruling concerns the application of GST/HST to amounts paid to a distributor and the eligibility to claim input tax credits (ITCs)
- The HST applies at different rates in different provinces, while the GST applies at a standard rate in the rest of Canada
- Company A is a retailer that sells products to Company B, a distributor, who then sells to consumers
- Company A pays Company B a specified amount annually for marketing and promotional services
- Company B did not charge GST/HST on these payments initially, but later requested payment after a CRA audit
- The ruling requested clarification on whether Company A is required to pay GST/HST to Company B and if they are eligible to claim ITCs for retroactively billed amounts
- The ruling given by the CRA is not specified in the text provided
Source: taxinterpretations.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
