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Newfoundland and Labrador
Regulation 2016


NEWFOUNDLAND AND LABRADOR REGULATION 34/16

NEWFOUNDLAND AND LABRADOR
REGULATION 34/16

Revenue Administration Regulations (Amendment)
under the
Revenue Administration Act
(O.C. 2016-101)

(Filed June 30, 2016)

Under the authority of sections 107 and 111 of the Revenue Administration Act, the Lieutenant-Governor in Council makes the following regulations.

Dated at St. John’s, June 30, 2016.

Julia Mullaley
Clerk of the Executive Council

REGULATIONS

Analysis


        1.   S.2 Amdt.
Interpretation

        2.   S.5.1 Added
Tax to be paid over-RST on insurance premiums

        3.   Ss.64.1 to 64.7 Added
64.1 Change of seller's
circumstances
64.2 Entries to be
distinguishable
64.3 Tax shown separately
64.4 Exemptions
64.5 Insurance exemptions
64.6 Surety bond - RST on
insurance premiums
64.7 Tax avoidance

        4.   Commencement


NLR 73/11
as amended

        1. Section 2 of the Revenue Administration Regulations is amended by adding immediately after subsection (2) the following:

             (3)  In Part X, "accident insurance", "sickness insurance", "life insurance" and "marine insurance" have the same meanings as in the Insurance Companies Act.

 

        2. The regulations are amended by adding immediately after section 5 the following:

Tax to be paid over- RST on insurance premiums

      5.1 (1) A retail purchaser shall pay tax on premiums in respect of contracts of insurance at the time the premium is paid.

             (2)  A seller shall collect tax on premiums in respect of contracts of insurance at the time the premium is paid.

             (3)  A seller who collects tax on premiums in respect of contracts of insurance shall remit the tax to the minister on or before the twentieth day of the calendar month immediately following the month in which the tax was collected.

             (4)  A retail purchaser referred to in subsection 91.1(10) of the Act shall compute the tax payable by him or her and shall, on or before the twentieth day of the calendar month immediately following that in which the tax became payable, pay the tax over to the minister.

 

        3. The regulations are amended by adding immediately after section 64 the following:

Change of seller's circumstances

   64.1 (1) Where a seller changes the name or address of his or her business, he or she shall immediately return his or her registration certificate to the minister for amendment.

             (2)  When a seller disposes of or discontinues his or her business, he or she shall, not later than 15 days after that, inform the minister of the disposition or discontinuance giving details of the transaction and submit his or her registration certificate for cancellation and make a return for a period unreported.

             (3)  Where a registration certificate is lost or destroyed, application shall immediately be made to the minister for a copy of it.

Entries to be distinguishable

   64.2 All entries concerning the tax in books and records required under section 9 of the Act, shall be separate and distinguishable from other entries made in it.

Tax shown separately

   64.3 Where a receipt, bill, invoice or other document is issued by a person selling tangible personal property at a retail sale, the following shall be shown as separate items on the document: 

             (a)  the registration certificate number; and

             (b)  the tax.

Exemptions

   64.4 Tangible personal property purchased by persons engaged in interprovincial transportation operations as common carriers and utilized for the purpose of the movement of goods or passengers by road but only to the extent that the total of kilometres travelled outside the province bears to the total of kilometres travelled for a stated period of time is exempt from the tax.

Insurance exemptions

   64.5 The following forms of insurance shall be excluded from the application of section 91.1 of the Act:

             (a)  accident insurance;

             (b)  sickness insurance;

             (c)  life insurance;

             (d)  marine insurance, other than marine insurance on sport watercraft, when the sport watercraft are 20 tons gross or less;

             (e)  surety, guarantee or fidelity insurance;

             (f)  residential mortgage default insurance;

             (g) tangible personal property purchased by diplomatic and consular agents, officers or employees, including spouses of those persons, who are so accredited by the Department of Global Affairs (Canada) and who have been issued identity cards authorizing the exemption in the province, provided that the person is not a Canadian citizen, nor a permanent resident of Canada, and is assigned to duty from the state he or she represents and is not engaged in another occupation; and

             (h)  endorsements on contracts of insurance with an effective date before July 1, 2016.

Surety bond - RST on insurance premiums

   64.6 (1) The minister may require a collector or other person to post a bond by way of cash or other security satisfactory to the minister in an amount that may be determined by the minister, which shall not be greater than the amount equal to 3 times the amount of tax estimated by the minister as the amount normally collected by the collector or other person each month in compliance with the Act.

             (2)  Notwithstanding subsection (1), the amount posted shall not be less than $1,000.

Tax avoidance

   64.7 Where, on June 7, 2016 a retail purchaser held an insurance policy that, according to its terms, expired or renewed on or after July 1, 2016, and the retail purchaser cancelled that policy of insurance between June 7, 2016 and July 1, 2016 and entered into a new contract of insurance before July 1, 2016 for the purpose of tax avoidance, 

             (a)  the new contract of insurance shall be considered to have been entered into on or after July 1, 2016; and

             (b)  the tax imposed in section 91.1 of the Act shall apply to premiums in respect of that contract of insurance.

Commencement

        4. These regulations come into force on July 1, 2016.