T-0.1 - Act respecting the Québec sales tax

Updated to 8 June 2002

This document has official status.

chapter T-0.1

Act respecting the Québec sales tax

TITLE I QUÉBEC SALES TAX

CHAPTER I DEFINITIONS AND INTERPRETATION

DIVISION I DEFINITIONS

1. For the purposes of this title and the regulations made under it, unless the context indicates otherwise,

“admission” means a right of entry or access to, or attendance at, a place of amusement, a seminar, an activity or an event;

“amount” means money, property or a service, expressed in terms of the amount of money or the value in terms of money of the property or service;

“bank” means a bank or an authorized foreign bank within the meaning of section 2 of the Bank Act (Revised Statutes of Canada, 1985, chapter B-1);

“basic tax content”, at a particular time, of property of a person means the amount determined by the formula

(A − B) × C,

where

(1)  A is the total of

(a)  the tax that was payable by the person in respect of the last acquisition or bringing into Québec of the property by the person,

(b)  the tax that would have been payable by the person in respect of the last bringing into Québec of the property by the person but for the fact that the person was a registrant, that the property was brought into Québec by the person for consumption or use exclusively in the course of commercial activities of the person and that the person would have been entitled to claim an input tax refund had the person paid the tax in respect of the bringing in,

(c)  the tax that would have been payable by the person in respect of the last bringing into Québec of the property by the person but for the fact that the property was brought into Québec for supply,

(d)  the tax that was payable by the person in respect of an improvement to the property acquired, or brought into Québec, by the person after the property was last acquired or brought into Québec by the person,

(e)  the tax that would have been payable by the person in respect of the bringing into Québec of an improvement to the property but for the fact that the person was a registrant, that the improvement was brought into Québec by the person for consumption or use exclusively in the course of commercial activities of the person and that the person would have been entitled to claim an input tax refund had the person paid the tax in respect of the bringing in after the property was last acquired or brought into Québec by the person,

(f)  the tax under section 16 that would have been payable by the person in respect of the last acquisition of the property by the person or in respect of an improvement to the property acquired by the person after the property was last acquired or brought into Québec by the person, but for sections 54.1, 75.1 and 80 or the fact that the property or improvement was acquired by the person for consumption, use or supply exclusively in the course of commercial activities, and

(g)  the tax under section 18 or section 18.0.1 that would have been payable by the person in respect of the last acquisition of the property by the person, and the tax under section 18 or section 18.0.1 that would have been payable by the person in respect of an improvement to the property acquired by the person after the property was last acquired or brought into Québec by the person, but for the fact that the person had acquired the property or improvement for consumption, use or supply exclusively in the course of commercial activities of the person;

(2)  B is the total of

(a)  all taxes referred to in paragraph 1 that the person was exempt from payment under any other Act or law,

(b)  all amounts, other than input tax refunds and amounts referred to in subparagraph a, in respect of tax referred to in subparagraphs a and d of paragraph 1 that the person was entitled to recover by way of rebate, refund or otherwise under this or any other Act or law or would have been entitled to so recover if the property or improvement had been acquired for use exclusively in activities that are not commercial activities, and

(c)  all amounts, other than input tax refunds and amounts referred to in subparagraph a, in respect of tax referred to in subparagraphs b, c and e to g of paragraph 1 that the person would have been entitled to recover by way of rebate, refund or otherwise under this or any other Act or law or would have been entitled to so recover if that tax had been payable and the property or improvement had been acquired for use exclusively in activities that are not commercial activities; and

(3)  C is the lesser of 1 and

   D
  --- ,
   E                                                                                                    

where

(1)  D is the fair market value of the property at the particular time, and

(2)  E is the total of

(a)  the value of the consideration for the last supply of the property to the person or, where the property was last brought into Québec by the person, the value of the property within the meaning of section 17, and

(b)  where the person acquires, or brings into Québec, an improvement to the property after the property was last acquired or brought in, the total of all amounts each of which is the value of the consideration for the supply to the person of such an improvement or, if the improvement is property that was brought into Québec by the person, the value of the property within the meaning of section 17;

“builder” of a residential complex or of an addition to a multiple unit residential complex means a person who

(1)  at a time when the person has an interest in the immovable on which the complex is situated, carries on or engages another person to carry on for the person

(a)  in the case of an addition to a multiple unit residential complex, the construction of the addition,

(b)  in the case of a residential unit held in co-ownership, the construction of the complex held in co-ownership in which the unit is situated, and

(c)  in any other case, the construction or substantial renovation of the complex,

(2)  acquires an interest in the complex at a time when

(a)  in the case of an addition to a multiple unit residential complex, the addition is under construction, and

(b)  in any other case, the complex is under construction or substantial renovation,

(3)  in the case of a mobile home or floating home, makes a supply of the home before the home has been used or occupied by any individual as a place of residence,

(4)  acquires an interest in the complex for the primary purpose of making one or more supplies of the complex or parts thereof or interests therein by way of sale, or making one or more supplies of the complex or parts thereof by way of lease, licence or similar arrangement to persons other than to individuals who are acquiring the complex or parts otherwise than in the course of a business or an adventure or concern in the nature of trade

(a)  in the case of a complex held in co-ownership or residential unit held in co-ownership at a time when the declaration of co-ownership relating to the residential complex is not yet entered in the land register, or

(b)  in any case, before the complex has been occupied by an individual as a place of residence or lodging, or

(5)  in any case, is deemed under section 220 to be a builder of the complex;

however, “builder” does not include

(6)  an individual described in paragraph 1, 2 or 4 who otherwise than in the course of a business or an adventure or concern in the nature of trade,

(a)  carries on the construction or substantial renovation of the complex,

(b)  engages another person to carry on the construction or substantial renovation of the complex for the individual, or

(c)  acquires the complex or an interest in it,

(7)  an individual described in paragraph 3 who makes a supply of a mobile home or floating home otherwise than in the course of a business or an adventure or concern in the nature of trade, or

(8)  a person described in any of paragraphs 1 to 3 whose only interest in the complex is a right to purchase the complex or an interest in it from a builder of the complex;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatever, whether the activity or undertaking is engaged in for profit or not, and any activity engaged in on a regular or continuous basis that involves the supply of property by way of lease, licence or similar arrangement, but does not include an office or employment;

“calendar quarter” means a period of three months beginning on the first day of January, April, July or October in each calendar year;

“capital property”, in respect of a person, means property that is, or that would be if the person were a taxpayer under the Taxation Act (chapter I-3), capital property of the person within the meaning of that Act, other than property described in Class 12, 14 or 44 of Schedule B to the Regulation respecting the Taxation Act (R.R.Q., 1981, chapter I-3, r.1) and any present or future amendment thereto;

“carrier” means a person who supplies a freight transportation service within the meaning of section 193;

“charity” means a registered charity within the meaning assigned by section 1 of the Taxation Act or a registered Canadian amateur athletic association within the meaning of that Act, but does not include a public institution;

“commercial activity” of a person means

(1)  a business carried on by the person, other than a business carried on without a reasonable expectation of profit by an individual, a personal trust or a partnership, all of the members of which are individuals, except to the extent to which the business involves the making of exempt supplies by the person,

(2)  an adventure or concern of the person in the nature of trade, other than an adventure or concern engaged in without a reasonable expectation of profit by an individual, a personal trust or a partnership, all of the members of which are individuals, except to the extent to which the adventure or concern involves the making of exempt supplies by the person, and

(3)  the making of a supply, other than an exempt supply, by the person of an immovable of the person, including anything done by the person in the course of or in connection with the making of the supply;

“commercial service”, in respect of corporeal movable property, means any service in respect of the property other than a service of shipping the property supplied by a carrier and a financial service;

“complex held in co-ownership” means a residential complex that contains more than one residential unit held in co-ownership;

“consideration” includes any amount that is payable for a supply by operation of law;

“consumer” of property or a service means an individual who acquires, or brings into Québec, the property or service at his expense for his personal consumption, use or enjoyment or the personal consumption, use or enjoyment of any other individual, but does not include an individual who acquires, or brings into Québec, the property or service for consumption, use or supply in the course of the commercial activities of the individual or other activities in the course of which the individual makes exempt supplies;

“continuous transmission commodity” means electricity, crude oil, natural gas, or any corporeal movable property, that is transportable by means of a wire, pipeline or other conduit;

“convention” means a formal meeting or assembly that is not open to the general public, but does not include a meeting or assembly the principal purpose of which is

(1)  to provide any type of amusement, entertainment or recreation,

(2)  to conduct contests or games of chance, or

(3)  to transact the business of the convenor or attendees

(a)  in the course of a trade show that is open to the general public, or

(b)  otherwise than in the course of a trade show;

“convention facility” means an immovable that is acquired by way of lease, licence or similar arrangement by the sponsor or organizer of a convention for use exclusively as the site for the convention;

“cooperative corporation” means a cooperative housing corporation and any other cooperative corporation within the meaning of subsection 2 of section 136 of the Income Tax Act (Revised Statutes of Canada, 1985, chapter 1, 5th Supplement);

“cooperative housing corporation” means a corporation that was incorporated, by or under the laws of Québec, another province, the Northwest Territories, the Yukon Territory, or Canada, providing for the establishment of the corporation or respecting the establishment of cooperative corporations, for the purpose of making supplies by way of lease, licence or similar arrangement of residential units to its members for the purpose of their occupancy as places of residence for individuals where

(1)  the statutes by or under which it was incorporated, its charter, articles of association or by-laws or its contracts with its members require that the activities of the corporation be engaged in at or near cost after providing for reasonable reserves and hold forth the prospect that surplus funds arising from those activities will be distributed among its members in proportion to patronage,

(2)  none of its members, except other cooperative corporations, have more than one vote in the conduct of the affairs of the corporation, and

(3)  at least 90 % of its members are individuals or other cooperative corporations and at least 90 % of its shares are held by such persons;

“credit note” means a credit note issued under section 449;

“credit union” has the meaning assigned by section 797 of the Taxation Act to the expression “savings and credit union” and also includes a deposit insurance corporation described in paragraph b of section 804 of that Act;

“debit note” means a debit note issued under section 449;

“debt security” means a right to be paid money and includes a deposit of money, but does not include a lease, licence or similar arrangement for the use of, or the right to use, property other than a financial instrument;

“direct cost” of a supply of corporeal movable property or a service means the total of all amounts each of which is the consideration paid or payable by the supplier

(1)  for the property or service if it was purchased by the supplier for the purpose of making a supply by way of sale of the property or service, or

(2)  for an article or material, other than capital property of the supplier, that was purchased by the supplier, to the extent that the article or material is to be incorporated into or is to form a constituent or component part of the property, or is to be consumed or expended directly in the process of manufacturing, producing, processing or packaging the property;

and, for the purposes of this definition, the following rules apply:

(1)  the consideration paid or payable by the supplier for property or a service is deemed to include any tax imposed under this Title that is payable by the supplier in respect of the acquisition or bringing into Québec of the property or service by the supplier, excluding the portion of tax, other than tax that became payable by the supplier at a time when the supplier was a registrant that is recovered or recoverable by the supplier; and

(2)  that consideration is determined without taking into account the portion of the duty, fee or tax referred to in section 52, other than tax imposed under Part IX of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15), that is recovered or recoverable by the supplier;

“document” includes money, a security, a record and a supporting document;

“employee” includes an officer;

“employer”, in relation to an officer, means the person from whom the officer receives remuneration;

“equity security” means a share of the capital stock of a corporation or any interest in or right to such a share;

“exclusive” means all or substantially all of the consumption, use or supply of property or a service;

“exempt supply” means a supply described in Chapter III;

“financial institution” throughout a taxation year means a person who is

(1)  a listed financial institution at any time in that taxation year, or

(2)  a financial institution, within the meaning of paragraph b or paragraph c of subsection 1 of section 149 of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15);

“financial instrument” means

(1)  a debt security,

(2)  an equity security,

(3)  an insurance policy,

(4)  an interest in a trust, a partnership or a succession, or any right in respect of such an interest,

(5)  a precious metal,

(6)  a contract or an option for the future supply of a commodity, where the contract or option is traded on a recognized commodity exchange,

(7)  a prescribed instrument,

(8)  an acceptance, a guarantee or an indemnity in respect of an instrument described in paragraph 1, 2, 4, 5 or 7, or

(9)  a contract or an option for the future supply of money or of an instrument described in any of paragraphs 1 to 8;

“financial service”, which does not include the operations and services described in paragraphs 14 to 20, means

(1)  the exchange, issue, payment, receipt or transfer of money, whether effected by the exchange of currency, by crediting or debiting accounts or otherwise;

(2)  the operation or maintenance of a charge, chequing, deposit, savings, loan or other account;

(3)  the borrowing or lending of a financial instrument;

(4)  the acceptance, allotment, issue, endorsement, variation, granting, repayment, renewal, processing or transfer of ownership of a financial instrument;

(5)  the variation, provision, receipt or release of an acceptance, a guarantee or an indemnity in respect of a financial instrument;

(6)  the payment or receipt of money as benefits, principal, dividends, other than patronage dividends, interest or any similar payment or receipt of money in respect of a financial instrument;

(6.1)  the payment or receipt of an amount in full or partial satisfaction of a claim arising under an insurance policy;

(7)  the making of any advance, the granting of any credit or the lending of money;

(8)  the underwriting of a financial instrument;

(9)  any service provided pursuant to the terms and conditions of any agreement relating to the payment of amounts for which a credit card voucher or charge card voucher has been issued;

(10)   the service of investigating and recommending the compensation in satisfaction of a claim where

(a)  the claim is made under a marine insurance policy, or

(b)  the claim is made under an insurance policy that is not in the nature of accident or sickness or life insurance and

i.  the service is supplied by an insurer or by a person who is licensed under the laws of Québec, another province, the Northwest Territories or the Yukon Territory to provide such a service, or

ii.  the service is supplied to an insurer or a group of insurers by a person who would be required to be so licensed but for the fact that the person is relieved from that requirement under the laws of Québec, another province, the Northwest Territories or the Yukon Territory;

(10.1)  the service of providing an insurer or a person who supplies a service referred to in paragraph 10 with an appraisal of the damage caused to property, or in the case of a loss of property, the value of the property, where the supplier of the appraisal inspects the property, or in the case of a loss of the property, the last-known place where the property was situated before the loss;

(11)  any supply deemed under section 39 to be a supply of a financial service;

(12)  the agreeing to provide, or the arranging for, a service referred to in any of paragraphs 1 to 9; or

(13)  a prescribed service;

(14)  the payment or receipt of money as consideration for the supply of property other than a financial instrument or of a service other than a financial service;

(15)  the payment or receipt of money in settlement of a claim (other than a claim under an insurance policy) under a warranty, guarantee or similar arrangement in respect of property other than a financial instrument or a service other than a financial service;

(16)  the service of providing advice, other than a service referred to in paragraph 10 or 10.1;

(17)  where the supplier is a person who provides management or administrative services to an investment plan, a corporation, partnership or trust the principal activity of which is the investing of funds, the provision to the investment plan, corporation, partnership or trust of

(a)  a management or administrative service, or

(b)  any other service, other than a prescribed service;

(18)  a professional service provided by an actuary, advocate, accountant or notary in the course of a professional practice;

(18.1)  the arranging for the transfer of ownership of shares of a cooperative housing corporation;

(19)  any service the supply of which is deemed under this title to be a taxable supply;

(20)  a prescribed service;

“floating home” means a structure that is composed of a floating platform and a building designed to be occupied as a place of residence for individuals that is permanently affixed to the platform, but does not include any freestanding appliances or furniture sold with the structure or any structure that has means of, or is capable of being readily adapted for, self-propulsion;

“foreign convention” means a convention

(1)  at least 75 % of the admissions to which are, at the time the sponsor of the convention determines the amount to be charged as consideration therefor, reasonably expected to be supplied to persons not resident in Canada, and

(2)  the sponsor of which is an organization whose head office is situated outside Canada or, where the organization has no head office, the member, or majority of members, of which having management and control of the organization is or are not resident in Canada;

“game of chance” means a lottery or other scheme under which prizes or winnings are awarded by way of chance only or by way of a mixture of chance and other factors where the result depends more on chance than on the other factors;

“government” means the government of Québec, another province, the Northwest Territories, the Yukon Territory or Canada;

“hospital authority” means a public institution, within the meaning of the Act respecting health services and social services (chapter S-4.2) or within the meaning of the Act respecting health services and social services for Cree Native persons (chapter S-5), that operates a hospital centre, or an organization that operates a public hospital located in Québec and that is designated by the Minister of National Revenue as a hospital authority;

“immovable” includes

(1)  a lease pertaining to an immovable;

(2)  a mobile home;

(3)  a floating home; and

(4)  a leasehold or other proprietary interest in a mobile home or a floating home;

“improvement”, in respect of property of a person, means any property or service supplied to, or property brought into Québec by, the person for the purpose of improving the property, to the extent that the consideration paid or payable by the person for the property or service or the value of the property brought in is, or would be if the person were a taxpayer within the meaning of the Taxation Act, included in determining the cost or, in the case of property that is capital property of the person, the adjusted cost base to the person of the property for the purposes of that Act;

“individual” means a natural person;

“insurance policy” means a policy of insurance that is issued, or a contract of insurance that is entered into, by an insurer and a policy or contract in the nature of accident or sickness insurance, whether or not the policy is issued, or the contract is entered into, by an insurer, and also includes

(1)  a policy of reinsurance issued by an insurer,

(2)  an annuity contract entered into by an insurer, or a contract entered into by an insurer that would be an annuity contract except that the payments under the contract

(a)  are payable on a periodic basis at intervals that are shorter or longer than one year, or

(b)  vary in amount depending on the value of a specified group of assets or on changes in interest rates, and

(3)  a contract entered into by an insurer all or part of the insurer’s reserves for which vary in amount depending on the value of a specified group of assets;

however, “insurance policy” does not include a warranty in respect of the quality, fitness or performance of corporeal property, where the warranty is supplied to a person who acquires the property otherwise than for resale;

(4)  a bid, performance, maintenance or payment bond issued in respect of a construction contract;

“insurer” means a person who is authorized under the laws of Québec, another province, the Northwest Territories, the Yukon Territory or Canada to carry on an insurance business in Canada or under the laws of another jurisdiction to carry on an insurance business in that other jurisdiction;

“inter vivos trust” means a trust other than a testamentary trust;

“investment plan” means

(1)  a trust governed by any of the following plans, trusts, arrangement or fund, within the meaning of the Taxation Act or the Regulation respecting the Taxation Act and any present or future amendment thereto:

(a)  a registered pension plan,

(b)  a profit sharing plan,

(c)  a registered supplementary unemployment benefit plan,

(d)  a registered retirement savings plan,

(e)  a deferred profit sharing plan,

(f)  a registered education savings plan,

(g)  an employee benefit plan,

(h)  an employee trust,

(i)  a mutual fund trust,

(j)  a unit trust,

(k)  a retirement compensation arrangement, or

(l)  a registered income fund;

(2)  the following corporations within the meaning of the said Act:

(a)  an investment corporation,

(b)  a mortgage investment corporation,

(c)  a mutual fund corporation, or

(d)  a non-resident owned investment corporation;

(3)  a corporation exempt from tax under the said Act by reason of paragraphs c.1 and c.2 of section 998 and section 998.1 of the said Act; and

(4)  a pooled fund trust within the meaning of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15);

“invoice” includes a statement of account, a bill and any other similar record or supporting document, regardless of its form or characteristics, and a cash register slip or receipt;

“listed financial institution” means a person who is

(1)  a bank,

(2)  a corporation that is authorized under the laws of Québec, another province, the Northwest Territories, the Yukon Territory or Canada to carry on in Canada the business of offering to the public its services as a trustee,

(3)  a person whose principal business is as a dealer or trader in, or as a broker or salesperson of, financial instruments or money,

(4)  a credit union,

(5)  an insurer or any other person whose principal business is providing insurance under insurance policies,

(6)  a segregated fund of an insurer,

(7)  the Régie de l’assurance-dépôts du Québec or the Canada Deposit Insurance Corporation,

(8)  a person whose principal business is the lending of money or the purchasing of debt securities or a combination thereof,

(9)  an investment plan,

(10)  a person providing services referred to in section 39;

“membership” includes a right granted by a particular person that entitles another person to services that are provided by, or to the use of facilities that are operated by, the particular person and that are not available, or are not available to the same extent or for the same charge, to a person to whom such a right has not been granted, and also includes such a right that is conditional on the acquisition or ownership of a share, bond or other security;

“mineral” includes petroleum, natural gas and related hydrocarbons, sand, gravel, ammonite gemstone, bituminous sands, calcium chloride, coal, kaolin, oil shale and silica;

“mobile home” means a building, the manufacture and assembly of which is completed or substantially completed, that is equipped with complete heating, electrical and plumbing facilities and that is designed to be moved to a site for installation on a foundation and connection to service facilities and to be occupied as a place of residence, but does not include any travel trailer, motor home, camping trailer or other vehicle or trailer designed for recreational use;

“money” includes any currency, cheque, promissory note, letter of credit, draft, traveller’s cheque, bill of exchange, postal note, money order, postal remittance and other similar instrument, whether Canadian or foreign, but does not include currency the fair market value of which exceeds its stated value as legal tender in the country of issuance or currency that is supplied or held for its numismatic value;

“month” means a period beginning on a particular day in a calendar month and ending

(1)  on the day immediately before the day in the next calendar month that has the same calendar number as the particular day, or

(2)  where the next calendar month does not have a day that has the same calendar number as the particular day, the last day of that next calendar month;

“motor vehicle” means a self-propelled road vehicle having a net mass of less than 4,000 kg, with four or more wheels and designed essentially for transporting persons or property by road;

“multiple unit residential complex” means a residential complex that contains more than one residential unit, but does not include a complex held in co-ownership;

“municipality” includes

(1)  a metropolitan community, the Kativik Regional Government or any other incorporated municipal body however designated, and

(2)  such other local authority as the Minister of Revenue may determine to be a municipality for the purposes of this title;

“mutual insurance federation” means a corporation each member of which is a mutual insurance corporation that is required, under an Act of the legislature of Québec, to be a member of the corporation, but does not include a corporation the main purpose of which is

(1)  related to automobile insurance,

(2)  to provide compensation to insurance policy holders of, or claimants on, insolvent insurers, or

(3)  to establish and manage a guarantee fund, cash reserve fund, mutual aid fund or similar fund for the benefit of its members and to provide financial assistance with regard to losses sustained on the winding-up or dissolution of its members;

“mutual insurance group” means a group that consists of

(1)  a mutual insurance federation and its members,

(2)  where the members of the mutual insurance federation are the sole investors in an investment fund, that fund, and

(3)  where there exists a mutual reinsurance corporation each member of which is a member of the mutual insurance federation and is not entitled to obtain reinsurance from any other reinsurance corporation, that mutual reinsurance corporation;

“net mass” means

(1)  in the case of a new motor vehicle, the mass of the vehicle indicated by the manufacturer at the time of shipping;

(2)  in the case of a used motor vehicle, the mass indicated on the last registration certificate issued in respect of the vehicle;

“non-profit organization” means a person, other than an individual, a succession, a trust, a charity, a public institution, a municipality or a government, that was organized and is operated solely for a purpose other than profit, no part of the income of which is payable to, or otherwise available for the personal benefit of, any proprietor, member or shareholder thereof unless the proprietor, member or shareholder is a club or an association the primary purpose of which is the promotion of amateur athletics in Canada;

“office” has the meaning assigned by section 1 of the Taxation Act, but does not include

(1)  the position of trustee in bankruptcy,

(2)  the position of receiver, including the position of a receiver within the meaning assigned by the second paragraph of section 310, or

(3)  the position of trustee of a trust or personal representative of a deceased individual where the person who acts in that capacity is entitled to an amount for doing so that is included, for the purposes of that Act, in computing the person’s income or, where the person is an individual, the person’s income from a business;

“officer” means a person who holds an office;

“organizer” of a convention means a person who acquires the convention facility or related convention supplies and who organizes the convention for another person who is the sponsor of the convention;

“passenger vehicle” has the meaning assigned by section 1 of the Taxation Act;

“patronage dividend” means an amount that is deductible under sections 786 to 796 of the Taxation Act in computing, for the purposes of that Act, the income of the person paying the amount;

“permanent establishment”, in respect of a particular person, means

(1)  a fixed place of business of the particular person, including a place of management, a branch, an office, a factory, a workshop, a mine, an oil or gas well, timberland, a quarry or any other place of extraction of natural resources, through which the particular person makes supplies, or

(2)  a fixed place of business of another person, other than a broker, general commission agent or other independent agent acting in the ordinary course of business, who is acting in Québec on behalf of the particular person and through whom the particular person makes supplies in the ordinary course of business;

“person” means a corporation, trust, individual, partnership or succession or a body that is an association, club, commission, union or other organization of any kind;

“personal representative”, of a deceased individual or the succession of a deceased individual, means the liquidator of the individual’s succession or any person who is responsible under the appropriate law for the proper collection, administration, disposition and distribution of the assets of the succession;

“personal trust” means

(1)  a testamentary trust, or

(2)  an inter vivos trust that is a personal trust, within the meaning of section 1 of the Taxation Act, all the beneficiaries, other than contingent beneficiaries, of which are individuals and all the contingent beneficiaries, if any, of which are individuals, charities or public institutions;

“place of amusement” means any premises or place, whether or not enclosed, at or in any part of which is staged or held any slide show, film, sound and light or similar presentation, any artistic, literary, musical, theatrical or other exhibition, performance or entertainment, any circus, fair, menagerie, rodeo or similar event, or any race, game of chance, athletic contest or other contest or game, and also includes a museum, historical site, zoo, wildlife or other park, place where bets are placed and any place, structure, apparatus, machine or device the purpose of which is to provide any type of amusement or recreation;

“pleasure vehicle” has the meaning assigned by section 1 of the Fuel Tax Act (chapter T-1);

“precious metal” means a bar, ingot, coin or wafer that is composed of gold, silver or platinum the purity level of which is at least 99.5 % in the case of gold and platinum and at least 99.9 % in the case of silver;

“property” does not include money;

“public college” means

(1)  a college governed by the General and Vocational Colleges Act (chapter C-29);

(2)  an institution that is accredited for purposes of subsidies for providing educational services at the college level under the Act respecting private education (chapter E-9.1);

(3)  an organization that operates a post-secondary college or post-secondary technical institute, situated in Québec,

(a)  that receives from a government or a municipality funds that are paid for the purpose of assisting the organization in ongoing provision of educational services to the general public, and

(b)  the primary purpose of which is to provide programs of instruction in one or more fields of vocational, technical or general education;

“public institution” means a registered charity, within the meaning of section 1 of the Taxation Act, that is a school authority, a public college, a university, a hospital authority or a local authority determined under paragraph 2 of the definition of “municipality” in this section to be a municipality;

“public sector body” means a government or a public service body;

“public service body” means a non-profit organization, a charity, a municipality, a school authority, a hospital authority, a public college or a university;

“recipient” of a supply of property or a service means

(1)  where consideration for the supply is payable under an agreement for the supply, the person who is liable under the agreement to pay that consideration,

(2)  where paragraph 1 does not apply and consideration is payable for the supply, the person who is liable to pay that consideration, and

(3)  where no consideration is payable for the supply,

(a)  in the case of a supply of property by way of sale, the person to whom the property is delivered or made available,

(b)  in the case of a supply of property otherwise than by way of sale, the person to whom possession or use of the property is given or made available, and

(c)  in the case of a supply of a service, the person to whom the service is rendered,

and any reference to a person to whom a supply is made shall be read as a reference to the recipient of the supply;

“registrant” means a person who is registered, or who is required to be registered, under Division I of Chapter VIII;

“related convention supplies” means property or services acquired or brought into Québec by a person exclusively for consumption, use or supply by the person in connection with a convention, but does not include

(1)  transportation services, other than a chartered service acquired by the person solely for the purpose of transporting attendees of the convention between any of the convention facilities, places of lodging of the attendees or transportation terminals,

(2)  entertainment,

(3)  except for the purposes of sections 357.2 to 357.5, property or services that are food or beverages or are supplied to the person under a contract for catering, or

(4)  property or services supplied by the person in connection with the convention for consideration that is separate from the consideration for the admission to the convention, unless the recipient of the supply is acquiring the property or service exclusively for consumption or use in the course of promoting, at the convention, property or services supplied by, or a business of, the recipient;

“reporting period” of a person means the reporting period of the person as determined under sections 458.6 to 467;

“residential complex” means

(1)  that part of a building in which one or more residential units are located, together with

(a)  that part of any common areas and other appurtenances to the building and the land contiguous to the building that is reasonably necessary for the use and enjoyment of the building as a place of residence for individuals, and

(b)  that proportion of the land subjacent to the building that that part of the building in which one or more residential units are located is of the whole building,

(2)  that part of a building, together with that proportion of any common areas and other appurtenances to the building and the land subjacent or contiguous to the building that is attributable to the unit and that is reasonably necessary for its use and enjoyment as a place of residence for individuals, that is

(a)  the whole or part of a semi-detached house, rowhouse unit, residential unit held in co-ownership or other similar premises that is, or is intended to be, a separate parcel or other division of an immovable owned, or intended to be owned, apart from any other unit in the building, and

(b)  a residential unit, and

(3)  the whole of a building described in paragraph 1, or the whole of a premises described in subparagraph a of paragraph 2, that is owned by or has been supplied by way of sale to an individual and that is used primarily as a place of residence of the individual, an individual related to the individual or a former spouse of the individual, together with

(a)  in the case of a building described in paragraph 1, any appurtenances to the building, the land subjacent to the building and that part of the land contiguous to the building, that are reasonably necessary for the use and enjoyment of the building, and

(b)  in the case of a premises described in subparagraph a of paragraph 2, that part of any common areas and other appurtenances to the building and the land subjacent or contiguous to the building that is attributable to the unit and that is reasonably necessary for the use and enjoyment of the unit,

(4)  a mobile home, together with any appurtenances to the home and, where the home is affixed to land, other than a site in a residential trailer park, for the purpose of its use and enjoyment as a place of residence for individuals, the land subjacent or contiguous to the home that is attributable to the home and is reasonably necessary for that purpose, and

(5)  a floating home;

however, “residential complex” does not include

(6)  a building, or that part of a building, that is an inn, a hotel, a motel, a boarding house or other similar premises, or the land and appurtenances attributable to the building or part, where

(a)  the building or part is not described in paragraph 3, and

(b)  all or substantially all of the supplies of residential units in the building or part by way of lease, licence or similar arrangement are, or are expected to be, for periods of continuous possession or use of less than 60 days;

“residential trailer park” of a person means

(1)  the land that is included in a trailer park of the person or, where the person has two or more trailer parks that are immediately contiguous to each other, the land that is included in those contiguous trailer parks, and any buildings, fixtures and other appurtenances to the land that are reasonably necessary

(a)  for the use and enjoyment of sites in the trailer parks by individuals

i.  residing in mobile homes, or travel trailers, motor homes or similar vehicles or trailers, situated or to be situated on those sites, or

ii.  occupying mobile homes, or travel trailers, motor homes or similar vehicles or trailers, situated or to be situated on those sites, or

(b)  for the purpose of engaging in the business of supplying those sites by way of lease, licence or similar arrangement;

however, “residential trailer park” does not include such land and appurtenances or any part of them unless the land encompasses at least two sites and

(2)  all or substantially all of the sites in the trailer parks are supplied, or are intended to be supplied, by way of lease, licence or similar arrangement under which continuous possession or use of a site is provided

(a)  for a period of at least one month, in the case of a mobile home or other residential unit, and

(b)  for a period of at least 12 months, in the case of a travel trailer, motor home or similar vehicle or trailer that is not a residential unit, and

(3)  if the sites were occupied by mobile homes, they would be suitable for use by individuals as places of residence throughout the year;

“residential unit” means the whole or part of a residential unit held in co-ownership, detached house, semi-detached house, rowhouse unit, mobile home, floating home, apartment, a room or suite in an inn, a hotel, a motel, a boarding house or a lodging house or in a residence for students, seniors, individuals with a disability or other individuals, or the whole or part of any other similar premises, that

(1)  is occupied by an individual as a place of residence or lodging,

(2)  is supplied by way of lease, licence or similar arrangement for the occupancy thereof as a place of residence or lodging for individuals,

(3)  is vacant, but was last occupied or supplied as a place of residence or lodging for individuals, or

(4)  has never been used or occupied for any purpose, but is intended to be used as a place of residence or lodging for individuals;

“residential unit held in co-ownership” means a residential complex that is, or is intended to be, a bounded space in a building described as a distinct entity on the declaration of co-ownership entered in the land register and includes any interest in land pertaining to ownership of the entity;

“retail sale” of a motor vehicle means

(1)  the sale of a motor vehicle to a person who receives it for any other purpose than to again make a supply of it by way of sale, otherwise than by way of gift, or by way of lease under an agreement under which continuous possession or use of the vehicle is provided to a person for a period of at least one year;

(2)  the sale of a new motor vehicle to a person who receives it to again make a supply of it by way of sale, otherwise than by way of gift, and who acquires it through a mandatary for the purpose of shipping the vehicle outside Québec;

“road vehicle” has the meaning assigned by section 4 of the Highway Safety Code (chapter C-24.2);

“sale”, in respect of property, includes, but for the purposes of subparagraph 2 of the second paragraph of section 17, any transfer of the ownership of the property and any transfer of the possession of the property under an agreement to transfer ownership of the property;

“school authority” means a school board or an institution providing educational services at the elementary or secondary level that is governed by the Act respecting private education;

“secured creditor” means

(1)  a particular person who has a security interest in the property of another person; or

(2)  a person who acts on behalf of the particular person with respect to the security interest and includes

(a)  a trustee appointed under a trust deed relating to a security interest,

(b)  a receiver or receiver-manager appointed by the particular person or appointed by a court on the application of the particular person,

(c)  a sequestrator, or

(d)  any other person performing a function similar to that of a person referred to in any of subparagraphs a to c;

“security interest” means any interest in property that secures payment or performance of an obligation, and includes an interest created by or arising out of a security, hypothec, mortgage, lien, pledge, charge, deemed or actual trust, assignment or encumbrance of any kind whatever, however or whenever arising, created, deemed to arise or otherwise provided for;

“segregated fund” of an insurer means a specified group of properties that are held in respect of insurance policies all or part of the reserves for which vary in amount depending on the fair market value of the properties;

“self-contained domestic establishment” has the meaning assigned by section 1 of the Taxation Act;

“service” means anything other than property, money and anything that is supplied to an employer by a person who is or agrees to become an employee of the employer in the course of or in relation to his office or employment;

“short-term accommodation” means a residential complex or a residential unit that is supplied to a recipient by way of lease, licence or other similar arrangement for the purpose of its occupancy by an individual as a place of residence or lodging, where the period throughout which the individual is given continuous occupancy of the complex or unit is less than one month and, for the purposes of sections 357.2 to 357.5,

(1)  includes any type of overnight shelter (other than shelter on a train, trailer, boat or structure that has means of, or is capable of being readily adapted for, self-propulsion) when supplied as part of a tour package, within the meaning assigned by section 63, that also includes food and the services of a guide, and

(2)  does not include a residential complex or unit when it

(a)  is supplied to the recipient under a timeshare arrangement, or

(b)  is included in that part of a tour package that is not the taxable portion of the tour package, within the meaning assigned to those expressions by section 63;

“single unit residential complex” means a residential complex that contains only one residential unit, but does not include a residential unit held in co-ownership;

“small supplier” means a person who, at any time, is a small supplier

(1)  under sections 294 to 297, unless the person is not, at that time, a small supplier under section 148 of the Excise Tax Act, or

(2)  under sections 297.0.1 and 297.0.2, unless the person is not, at that time, a small supplier under section 148.1 of the Excise Tax Act;

“specified corporeal movable property” means property that is, or is an interest in,

(1)  a drawing, a print, an etching, a sculpture, a painting or other similar work of art,

(2)  jewellery,

(3)  a rare folio, manuscript or book,

(4)  a stamp,

(5)  a coin, or

(6)  prescribed movable property;

“sponsor” of a convention means the person who convenes the convention and supplies admissions to it;

“spouse” of a particular individual at any time means an individual who is the spouse of the particular individual at that time for the purposes of the Income Tax Act;

“straddle plant” means a natural gas processing plant devoted primarily to the recovery of natural gas liquids or ethane from natural gas that is transported by pipeline to the plant by a common carrier of natural gas;

“substantial renovation” of a residential complex means the renovation or alteration of a building to such an extent that all or substantially all of the building that existed immediately before the renovation or alteration was begun, other than the foundation, external walls, interior supporting walls, floors, roof and staircases, has been removed or replaced where, after completion of the renovation or alteration, the building is, or forms part of, a residential complex;

“supplier”, in respect of a supply, means the person making the supply;

“supply” means the provision of property or a service in any manner, including sale, transfer, barter, exchange, licence, lease, gift or alienation;

“tax” means tax payable under this title;

“taxable supply” means a supply that is made in the course of a commercial activity;

“taxation year” of a person means

(1)  where the person is a taxpayer within the meaning of the Taxation Act, other than an unincorporated person exempt in accordance with Book VIII of that Act from tax under Part I of that Act, the taxation year of the person for the purposes of that Act,

(1.1)  where the person is a partnership described in subparagraph ii of subparagraph b of the second paragraph of section 7 of that Act, the fiscal period of the person’s business, determined under section 7 of that Act, and

(2)  in any other case, the period that would be the taxation year of the person for the purposes of that Act if the person were a corporation other than a professional corporation within the meaning of section 1 of that Act;

“taxi business” means a business carried on in Québec of transporting passengers by taxi for fares that are regulated by the Act respecting transportation by taxi (chapter T-11.1);

“telecommunication” means any transmission, emission or reception of signs, signals, writing, images, sounds or intelligence of any nature by any wire, cable, radio, optical or other electromagnetic system, or by any similar technical system;

“telecommunication service” means

(1)  the service of emitting, transmitting or receiving signs, signals, writing, images or sounds or intelligence of any nature by wire, cable, radio, optical or other electromagnetic system, or by any similar technical system, or

(2)  making available for such emission, transmission or reception telecommunications facilities of a person who carries on the business of supplying services referred to in paragraph 1;

“telecommunications facility” means any facility, apparatus or other thing, including any wire, cable, radio, optical or other electromagnetic system, or any similar technical system, or any part thereof, that is used or is capable of being used for telecommunications;

“testamentary trust” has the meaning assigned by section 1 of the Taxation Act;

“trailer park” of a person means a piece of land that is owned by or leased to the person and that is exclusively composed of

(1)  one or more sites each of which is, or is intended to be, supplied by the person by way of lease, licence or similar arrangement to the owner, lessee or person in occupation or possession of a mobile home, or a travel trailer, motor home or similar vehicle or trailer, situated or to be situated on the site, and

(2)  other land that is reasonably necessary

(a)  for the use and enjoyment of the sites by individuals

i.  residing in mobile homes, or travel trailers, motor homes or similar vehicles or trailers, situated or to be situated on those sites, or

ii.  occupying mobile homes, or travel trailers, motor homes or similar vehicles or trailers, situated or to be situated on those sites, or

(b)  for the purpose of engaging in the business of supplying the sites by way of lease, licence or similar arrangement;

“university” means

(1)  an educational institution at the university level within the meaning of the Act respecting educational institutions at the university level (chapter E-14.1), or

(2)  a recognized degree-granting institution situated in Québec or an organization situated in Québec that operates a research body of, or a college affiliated with, such an institution;

“used corporeal movable property” means corporeal movable property that has been used in Québec;

“zero-rated supply” means a supply described in Chapter IV.

1991, c. 67, s. 1; 1992, c. 21, s. 372; 1993, c. 19, s. 167; 1992, c. 68, s. 156, s. 157; 1994, c. 22, s. 364; 1995, c. 1, s. 247; 1994, c. 23, s. 23; 1995, c. 63, s. 299; 1997, c. 3, s. 115; 1997, c. 14, s. 329; 1997, c. 31, s. 146; 1997, c. 85, s. 418; 1998, c. 16, s. 309; 1999, c. 83, s. 333; 1999, c. 14, s. 30; 2000, c. 25, s. 26; 2000, c. 56, s. 218; 2001, c. 51, s. 258; 2001, c. 53, s. 272; 2002, c. 9, s. 151.

DIVISION II INTERPRETATION

1.1. For the purposes of this Title and the regulations, a legal person, whether or not established for pecuniary gain, is designated by the word “corporation”.

1997, c. 3, s. 116.

2. Except as otherwise provided in this Title, where an amount or a number is required under this Title to be determined or calculated by or in accordance with an algebraic formula, if the amount or number when so determined or calculated would, but for this section, be a negative amount or number, it is deemed to be nil.

1991, c. 67, s. 2.

3. Related persons are deemed not to deal with each other at arm’s length and it is a question of fact whether persons not related to each other were, at any particular time, dealing with each other at arm’s length.

Persons are related to each other if, by reason of sections 17 and 19 to 21 of the Taxation Act (chapter I-3), they are related to each other for the purposes of that Act.

1991, c. 67, s. 3.

4. A member of a partnership is deemed to be related to the partnership.

1991, c. 67, s. 4.

5. A corporation is associated with another corporation if, by reason of sections 21.4 and 21.20 to 21.25 of the Taxation Act (chapter I-3), the corporation is associated with the other corporation for the purposes of that Act.

1991, c. 67, s. 5.

6. A person other than a corporation is associated with a corporation if the latter is controlled by the person or by a group of persons of which the person is a member and each of whom is associated with the others.

1991, c. 67, s. 6.

7. A person is associated with a partnership if the total of the shares of the profits of the partnership to which the person and all other persons who are associated with the person are entitled is more than half of the total profits of the partnership, or would be if the partnership had profits.

1991, c. 67, s. 7.

8. A person is associated with a trust if the total of the values of the interests in the trust of the person and all other persons who are associated with the person is more than half of the total value of all interests in the trust.

1991, c. 67, s. 8.

9. A person is associated with another person if each of them is associated with the same third person.

1991, c. 67, s. 9.

10. The following rules apply in respect of a segregated fund of an insurer:

(1)  the segregated fund is deemed to be a trust that is a separate person from the insurer and that does not deal at arm’s length with the insurer;

(2)  the insurer is deemed to be a trustee of the trust;

(3)  the activities of the segregated fund are deemed to be activities of the trust and not activities of the insurer.

1991, c. 67, s. 10.

10.1. Where, at any time, an amount, other than an amount in respect of tax under this Title, is deducted from the segregated fund of an insurer, the following rules apply:

(1)  if the amount is in respect of property or a service that the fund is, because of the application of this Title other than this section, considered to have acquired from the insurer, that supply shall be deemed to be a taxable supply, other than a zero-rated supply, and the amount shall be deemed to be consideration for that supply that becomes due at that time; and

(2)  if the amount is not in respect of property or a service that the fund is, because of the application of this Title other than this section, considered to have acquired either from the insurer or another person, the insurer shall be deemed to have made, and the fund shall be deemed to have received, at that time, a taxable supply, other than a zero-rated supply, of a service, and the amount shall be deemed to be consideration for the supply that becomes due at that time.

The first paragraph does not apply to an amount deducted from a segregated fund of an insurer if

(1)  the amount is a distribution of income, a payment of a benefit, or the amount of a redemption, in respect of an interest of another person in the fund; or

(2)  the amount is a prescribed amount.

2001, c. 53, s. 273.

11. A person is deemed to be resident in Québec at any time if,

(1)  in the case of a corporation, the corporation is incorporated or continued in Québec and not continued elsewhere;

(2)  in the case of an association, a club, a body or a partnership, or a branch thereof, the member, or a majority of the members, having management and control thereof is or are resident in Québec at that time;

(3)  in the case of an association of employees, it is carrying on activities as such in Québec and has a local union or branch in Québec at that time;

(4)  in the case of an individual, the individual is deemed under any of paragraphs b to f of section 8 of the Taxation Act (chapter I-3) to be resident in Québec at that time.

1991, c. 67, s. 11; 1997, c. 85, s. 419.

11.1. Except for the purpose of determining the place of residence of an individual in the individual’s capacity as a consumer and except for the purposes of Division V of Chapter IV, a person is deemed to be resident in Québec if the person is resident in Canada and has a permanent establishment in Québec.

For the purposes of Division V of Chapter IV, a person who is not resident in Québec but who is resident in Canada and has a permanent establishment in Québec is deemed to be resident in Québec, but only in respect of activities carried on by the person through that establishment.

1997, c. 85, s. 420; 1999, c. 83, s. 306; 2001, c. 51, s. 259.

11.1.1. A person resident in Québec who has a permanent establishment outside Québec but within Canada is deemed not to be resident in Québec, but only in respect of activities carried on by the person through that establishment.

1999, c. 83, s. 307.

11.2. For the purposes of sections 11.1, 11.1.1 and 22.2 to 22.30, “permanent establishment” of a person means

(1)  in the case of an individual, the succession of a deceased individual or a trust that carries on a business, within the meaning of section 1 of the Taxation Act (chapter I-3), an establishment, within the meaning of the first paragraph of section 12 or section 13 or 15 of the Taxation Act, of the person;

(2)  in the case of a corporation that carries on a business, within the meaning of section 1 of the Taxation Act, an establishment, within the meaning of the first paragraph of section 12 or any of sections 13 to 16 of the Taxation Act;

(3)  in the case of a particular partnership,

(a)  an establishment, within the meaning of the first paragraph of section 12 or section 13 or 15 of the Taxation Act, of a member that is an individual, the succession of a deceased individual or a trust where the establishment relates to a business, within the meaning of section 1 of the Taxation Act, carried on through the partnership,

(b)  an establishment, within the meaning of the first paragraph of section 12 or any of sections 13 to 16 of the Taxation Act, of a member that is a corporation where the establishment relates to a business, within the meaning of section 1 of the Taxation Act, carried on by the particular partnership, or

(c)  a permanent establishment, within the meaning of this section, of a member that is a partnership where the establishment relates to a business, within the meaning of section 1 of the Taxation Act, carried on by the particular partnership; and

(d)  in any other case, a place that would be an establishment, within the meaning of the first paragraph of section 12 or any of sections 13 to 16 of the Taxation Act, of the person if the person were a corporation and its activities were a business for the purposes of that Act.

1997, c. 85, s. 420; 1999, c. 83, s. 308.

12. A person not resident in Canada who has a permanent establishment in Québec is deemed to be resident in Québec, but only in respect of activities carried on by the person through that establishment.

1991, c. 67, s. 12; 1997, c. 85, s. 421.

12.1. Subject to section 12, where, under section 11.1.1 of the Taxation Act (chapter I-3), a corporation is deemed for the purposes of that Act to be resident in a country other than Canada throughout a taxation year of the corporation and not to be resident in Canada at any time in the year, the corporation is deemed to be resident in that other country throughout the year and not to be resident in Canada at any time in the year.

1994, c. 22, s. 365.

13. A person resident in Québec who has a permanent establishment outside Canada is deemed not to be resident in Québec, but only in respect of activities carried on by the person through that establishment.

1991, c. 67, s. 13; 1997, c. 85, s. 421.

14. For the purposes of section 351, a person resident in Canada who has a permanent establishment outside Canada is deemed not to be resident in Canada, but only in respect of activities carried on by the person through that establishment.

1991, c. 67, s. 14.

14.1. A person not resident in Québec is deemed to be resident in Canada at any time if the person is deemed to be resident in Canada at that time under the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15).

1995, c. 63, s. 300.

15. The fair market value of property or a service supplied to a person is determined without reference to any tax excluded by section 52 from the consideration for the supply.

1991, c. 67, s. 15.

CHAPTER II TAXATION

DIVISION I IMPOSITION OF TAX

§ 1 . — Taxable supply made in Québec

1994, c. 22, s. 366.

16. Every recipient of a taxable supply made in Québec shall pay to the Minister of Revenue a tax in respect of the supply calculated at the rate of 7.5% on the value of the consideration for the supply.

However, the rate of the tax in respect of a taxable supply that is a zero-rated supply is 0%.

1991, c. 67, s. 16; 1993, c. 19, s. 168; 1994, c. 22, s. 367; 1995, c. 1, s. 248; 1997, c. 85, s. 422.

16.1. Every recipient of a zero-rated supply of a product mentioned in paragraph 1.1 of section 177 who begins, at any time, to use the product to make wine or beer shall, immediately after that time, pay to the Minister a tax in respect of the product calculated at the rate of 7.5% of the value of the consideration for the supply.

This section does not apply in respect of a product that a registrant begins to use exclusively in the course of his commercial activities and in respect of which the registrant would be entitled to claim an input tax refund had he paid the tax provided for in the first paragraph in respect of the product.

1997, c. 14, s. 330; 1997, c. 85, s. 423.

§ 2 . — Bringing into Québec of corporeal property

1994, c. 22, s. 368.

17. Every person who brings into Québec corporeal property for consumption or use in Québec by the person or at the person’s expense by another person or for supply in Québec for consideration where the person is a small supplier who is not a registrant or, in the case of a road vehicle, a person who is not registered under Division I of Chapter VIII shall, immediately after the bringing into Québec of the property, pay to the Minister a tax in respect of that property, calculated at the rate of 7.5% on the value of the property.

For the purposes of the first paragraph, the value of the property means

(1)  in the case of property produced by the person outside Québec but in Canada and brought into Québec within 12 months after it is produced, the cost price of the property, including the tax paid or payable by the person under Part IX of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15) in respect of the elements of the cost price;

(2)  in the case of property, other than a road vehicle referred to in subparagraph 2.1, supplied to the person outside Québec by way of sale and consumed or used in Québec within 12 months after it is supplied, the value of the consideration for the supply;

(2.1)  in the case of a used road vehicle supplied to the person outside Québec by way of sale that must be registered under the Highway Safety Code (chapter C-24.2) following an application by the person,

(a)  where the vehicle is used in Québec within 12 months after the supply, the value of the consideration for the supply or, if the supply is made for no consideration or for consideration less than the estimated value of the vehicle, that estimated value, and

(b)  where the vehicle is not used in Québec within 12 months after the supply, the estimated value of the vehicle;

(2.2)  in the case of property supplied by way of sale outside Québec to a person who is a small supplier, other than a registrant, and who brings the property into Québec for supply in Québec for consideration,

(a)  if the property is property other than a used road vehicle referred to in subparagraph b, the value of the consideration, and

(b)  if the property is a used road vehicle that must be registered under the Highway Safety Code following an application by the person, the value of the consideration for the supply to the person or, where the supply is made without consideration or for consideration less than the estimated value of the vehicle, that estimated value;

(3)  in the case of property supplied to the person by way of lease, licence or similar arrangement outside Québec, the value of the consideration for the supply that can reasonably be attributed to the right of enjoyment of the property in Québec;

(4)  in any other case, the fair market value of the property.

Notwithstanding the second paragraph, the value of property brought into Québec in prescribed circumstances shall be determined in the prescribed manner.

The first paragraph does not apply in respect of

(1)  corporeal property, where tax under section 16 is payable in respect of the supply of the property;

(2)  goods to which section 81 applies;

(3)  (subparagraph repealed);

(4)  corporeal property brought into Québec by a registrant for exclusive consumption or use in the course of the commercial activities of the registrant and in respect of which the registrant would, if he had paid tax under the first paragraph in respect of the property, be entitled to apply for an input tax refund.

A person who brings corporeal property into Québec includes any person who causes such property to be brought into Québec.

1991, c. 67, s. 17; 1993, c. 19, s. 169; 1995, c. 1, s. 249; 1995, c. 63, s. 301; 1997, c. 85, s. 424; 2001, c. 51, s. 260.

17.0.1. For the purposes of subparagraph 2.1 and subparagraph b of subparagraph 2.2 of the second paragraph of section 17, the estimated value of a road vehicle is

(1)  in the case of a vehicle for which the average wholesale price is listed in the most recent edition, on the first day of the month in which the vehicle is brought into Québec, of the Guide d’Évaluation Hebdo (Automobiles et Camions Légers) published by Hebdo Mag Inc., that price less an amount of $500;

(1.1)  (paragraph repealed);

(2)  in the case of a vehicle for which an average wholesale price is listed in the most recent edition, on the first day of the month preceding the month in which the vehicle is brought into Québec, of the Canadian Motorcycle Dealers Blue Book published by All Seasons Publications Ltd., that price less an amount of $500;

(3)  in the case of a vehicle for which an average wholesale price is listed in the most recent edition, on the first day of the month preceding the month in which the vehicle is brought into Québec, of the Canadian ATV, Snowmobile & Watercraft Dealers Blue Book published by All Seasons Publications Ltd., that price less an amount of $500; and

(4)  in any other case, the value of the vehicle prescribed by the Minister.

1995, c. 1, s. 250; 1995, c. 63, s. 302; 1997, c. 14, s. 331; 2000, c. 39, s. 280.

17.0.2. Where subparagraph a of subparagraph 2.1 or subparagraph b of subparagraph 2.2 of the second paragraph of section 17 applies in respect of a road vehicle that is damaged or that shows unusual wear at the time it is supplied to a person, that is brought into Québec by the person immediately after that time and immediately after the bringing of the vehicle into Québec, the person provides the Minister or a person prescribed for the purposes of section 473 with a written estimate of the vehicle or of the repairs to be carried out in respect of the vehicle, made by the person referred to in the second paragraph of section 55.0.3, the value of the vehicle that corresponds to the estimated value of the vehicle described in section 17.0.1 may be reduced by an amount equal to

(1)  the amount by which that value exceeds the value of the vehicle stated in the written estimate; or

(2)  the amount by which the value stated in the written estimate of the repairs to be carried out in respect of the vehicle exceeds $500.

1995, c. 1, s. 250; 1995, c. 63, s. 303.

17.1. For the purposes of section 17, where a person brings into Québec a road vehicle (in this section referred to as the “road vehicle brought”) that must be registered under the Highway Safety Code (chapter C-24.2) following an application by the person and which the person acquired by way of a supply made outside Québec by a supplier of another jurisdiction, the value of the vehicle on which the tax under the said section must be calculated shall be reduced by any credit granted by the supplier for another road vehicle he accepted in full or partial consideration for the supply of the road vehicle brought, where the following conditions are met:

(1)  the person owned the road vehicle thus given in exchange and paid, in respect of the vehicle, tax under this Act or the tax prescribed by Chapter II of the Retail Sales Tax Act (chapter I-1), or any tax of the same nature levied by another jurisdiction, other than the tax payable under Part IX of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15);

(2)  the road vehicle thus given in exchange was a used vehicle and, where tax was paid in respect of that vehicle, the person is not entitled to a rebate of the tax so paid;

(3)  the jurisdiction in which the supply of the road vehicle brought was made grants the same tax abatement to persons resident or carrying on a business in its territory;

(4)  (paragraph repealed);

(5)  the person is a large business or is not required to collect the tax payable under Part IX of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15) in respect of a road vehicle so given in exchange.

For the purposes of this section, “large business” has the meaning assigned by sections 551 to 551.4 of the Act to amend the Taxation Act, the Act respecting the Québec sales tax and other legislative provisions (1995, chapter 63).

1993, c. 19, s. 170; 1995, c. 63, s. 304; 1999, c. 83, s. 309; 2002, c. 9, s. 152.

17.2. (Repealed).

1993, c. 19, s. 170; 1995, c. 63, s. 305.

17.3. (Repealed).

1993, c. 19, s. 170; 1995, c. 1, s. 251; 1995, c. 63, s. 306.

17.4. Notwithstanding section 17, no tax is payable in respect of corporeal property brought into Québec for consumption, use or supply as supplies related to a convention where the property is brought into Québec by the sponsor of a foreign convention or the organizer of such a convention who is not registered under Division I of Chapter VIII.

1994, c. 22, s. 369.

17.5. Subject to section 404, a person is entitled to a rebate of tax paid under section 17 in respect of the bringing into Québec of corporeal property from outside Canada where

(1)  the person paid tax in respect of the property acquired by the person on consignment, approval or other similar terms;

(2)  the property is, within 60 days after its release within the meaning of the Customs Act (Revised Statutes of Canada, 1985, chapter 1, 2nd Supplement) but before it is used or consumed otherwise than on a trial basis, shipped outside Québec by the person for the purpose of returning it to the supplier and is not damaged after its release and before its shipping; and

(3)  within two years after the day the tax was paid, the person files with the Minister an application, in prescribed form containing prescribed information, for a rebate of the tax.

1994, c. 22, s. 369; 1997, c. 85, s. 425.

17.6. Subject to section 404, a person is entitled to a rebate of tax paid under section 17 in respect of the bringing into Québec of corporeal property from Canada but outside Québec where

(1)  the person paid tax in respect of the property acquired by the person on consignment, approval or other similar terms;

(2)  the property is, within 60 days after its being brought into Québec but before it is used or consumed otherwise than on a trial basis, shipped outside Québec by the person for the purpose of returning it to the supplier and is not damaged after its being brought into Québec and before its shipping; and

(3)  within two years after the day the tax was paid, the person files with the Minister an application, in prescribed form containing prescribed information, for a rebate of the tax.

1994, c. 22, s. 369; 1997, c. 85, s. 426.

17.7. Subject to section 404, an individual is entitled to a rebate of tax paid under section 17 in respect of the bringing into Québec of a pleasure boat for the purpose of storing it during the winter where

(1)  the individual paid tax in respect of the bringing into Québec of the pleasure boat;

(2)  the pleasure boat is taken or shipped outside Québec within a reasonable period of time after the winter storage;

(3)  within four years after the date on which the pleasure boat was taken or shipped outside Québec, the individual files with the Minister an application, in prescribed form containing prescribed information, for a rebate of the tax; and

(4)  the application for a rebate is filed with proof establishing that the individual paid tax in respect of the pleasure boat and that the pleasure boat was shipped or taken outside Québec after the winter storage.

1997, c. 14, s. 332.

§ 3 . — Taxable supply made outside Québec or by a non-resident person who is not registered

1994, c. 22, s. 369; 1995, c. 1, s. 252.

18. Every recipient of a taxable supply, except a zero-rated supply, other than the zero-rated supply included in section 191.3.2, or a supply included in section 18.0.1, shall pay to the Minister a tax in respect of the supply calculated at the rate of 7.5 % on the value of the consideration for the supply if the supply is

(1)  a supply, other than a prescribed supply, of a service made outside Québec to a person who is resident in Québec, other than a supply of a service that is

(a)  acquired for consumption, use or supply exclusively in the course of commercial activities of the person or activities that are engaged in exclusively outside Québec by the person and that are not part of a business or an adventure or concern in the nature of trade engaged in by the person in Québec,

(b)  consumed by an individual exclusively outside Québec, other than a training service the supply of which is made to a person who is not a consumer,

(c)  in respect of an immovable situated outside Québec,

(d)  a service (other than a custodial or nominee service in respect of securities or precious metals of the person) in respect of corporeal movable property that is

i.  situated outside Québec at the time the service is performed, or

ii.  shipped outside Québec as soon after the service is performed as is reasonable having regard to the circumstances surrounding the shipping outside Québec and is not consumed, used or supplied in Québec after the service is performed and before the shipping outside Québec of the property,

(e)  a transportation service, other than a freight transportation service the supply of which is referred to in section 24.2, or

(f)  a service rendered in connection with criminal, civil or administrative litigation outside Québec, other than a service rendered before the commencement of such litigation;

(2)  a supply, other than a prescribed supply, of incorporeal movable property made outside Québec to a person who is resident in Québec, other than a supply of property that

(a)  is acquired for consumption, use or supply exclusively in the course of commercial activities of the person or activities that are engaged in exclusively outside Québec by the person and that are not part of a business or an adventure or concern in the nature of trade engaged in by the person in Québec,

(b)  may not be used in Québec, or

(c)  relates to an immovable situated outside Québec, to a service to be performed wholly outside Québec or to corporeal movable property situated outside Québec;

(3)  a supply, other than a prescribed supply, of corporeal movable property made by a person not resident in Québec who is not registered under Division I of Chapter VIII to a recipient who is a registrant where

(a)  physical possession of the property is transferred to the recipient in Québec by another registrant who has

i.  made in Québec a supply by way of sale of the property or a supply of a service of manufacturing or producing the property to a person not resident in Québec, or

ii.  acquired physical possession of the property in order to make a supply of a commercial service in respect of the property to a person not resident in Québec,

(b)  the recipient gives to the other registrant a certificate of the recipient referred to in subparagraph 3 of the first paragraph of section 327.2,

(c)  the property

i.  is not acquired by the recipient for consumption, use or supply exclusively in the course of commercial activities of the recipient, or

ii.  (subparagraph repealed);

iii.  is a passenger vehicle which the recipient acquires for use in Québec as capital property in the course of commercial activities of the recipient and in respect of which the capital cost to the recipient exceeds the amount deemed under paragraph d.3 or d.4 of section 99 of the Taxation Act (chapter I-3) to be the capital cost of the passenger vehicle to the recipient for the purposes of the said Act;

(4)  a supply, other than a prescribed supply, of corporeal movable property made at a particular time by a person not resident in Québec who is not registered under Division I of Chapter VIII to a particular recipient resident in Québec where

(a)  the property is delivered or made available, in Québec, to the particular recipient and the particular recipient is not a registrant who is acquiring the property for consumption, use or supply exclusively in the course of commercial activities of the particular recipient, and

(b)  the person not resident in Québec has previously made a taxable supply of the property by way of lease, licence or similar arrangement to a registrant with whom the person was not dealing at arm’s length or who was related to the particular recipient, and

i.  the property was delivered or made available, in Québec, to the registrant,

ii.  the registrant was entitled to claim an input tax refund in respect of the property or was not required to pay tax under this section in respect of the supply solely because he had acquired the property for consumption, use or supply exclusively in the course of commercial activities of the registrant, and

iii.  the supply was the last supply made by the person not resident in Québec to a registrant before the particular time;

(5)  a supply of a continuous transmission commodity, if the supply is deemed under section 23 to be made outside Québec to a registrant by a person who was the recipient of a supply of the commodity that was a zero-rated supply included in section 191.3.1 or that would, but for subparagraph e of paragraph 1 of that section, have been included in that section, and the registrant is not acquiring the commodity for consumption, use or supply exclusively in the course of commercial activities of the registrant; or

(6)  a supply, included in section 191.3.2, of a continuous transmission commodity that is neither shipped outside Québec, as described in subparagraph 1 of the first paragraph of that section, nor supplied, as described in subparagraph 2 of the first paragraph of that section, by the recipient and the recipient is not acquiring the commodity for consumption, use or supply exclusively in the course of commercial activities of the recipient.

1991, c. 67, s. 18; 1993, c. 19, s. 171; 1994, c. 22, s. 370; 1995, c. 1, s. 357; 1995, c. 1, s. 253; 1995, c. 63, s. 307; 1997, c. 85, s. 427; 2001, c. 53, s. 274.

18.0.1. Every person who is resident in Québec and is the recipient of a taxable supply of incorporeal movable property or a service made outside Québec, otherwise than by reason of section 23 or 24.2, but within Canada that is acquired by the person for consumption, use or supply primarily in Québec shall pay to the Minister, each time consideration, or a part thereof, for the supply becomes due or is paid without having become due, a tax in respect of the supply equal to the amount determined by the formula

A × B × C.

For the purposes of this formula,

(1)  A is 7.5%;

(2)  B is the value of the consideration or a part thereof that is paid or becomes due at that time; and

(3)  C is the extent, expressed as a percentage, to which the person acquired the property or service for consumption, use or supply in Québec.

No tax is payable in respect of

(1)  a supply of property or a service to a registrant, other than a registrant whose net tax is determined under sections 433.1 to 433.15 or under a regulatory provision made under section 434, who acquired the property or service for consumption, use or supply exclusively in the course of commercial activities of the registrant;

(2)  a zero-rated supply;

(3)  a supply of a service, other than a custodial or nominee service in respect of securities or precious metals of the person, in respect of corporeal movable property that is shipped outside Québec as soon after the service is performed as is reasonable having regard to the circumstances surrounding the shipment outside Québec and is not consumed, used or supplied in Québec after the service is performed and before the property is shipped outside Québec;

(4)  a supply of a service rendered in connection with criminal, civil or administrative litigation outside Québec, other than a service rendered before the commencement of such litigation;

(5)  a supply of a transportation service;

(6)  a supply of a telecommunication service; or

(7)  a prescribed supply of property or a service where the property or service is acquired by the recipient of the supply in prescribed circumstances, in accordance with such terms and conditions as may be prescribed.

For the purposes of the first paragraph, a supply is made in Canada if it is deemed to be made in Canada under Part IX of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15).

1997, c. 85, s. 428; 2001, c. 53, s. 275.

18.0.2. Tax under sections 18 and 18.0.1 that is calculated on consideration, or a part thereof, for a supply that becomes payable at any time, or is paid at any time without having become due, becomes payable at that time.

1997, c. 85, s. 428.

§ 4 . —

Repealed, 1995, c. 63, s. 308.

1995, c. 1, s. 254; 1995, c. 63, s. 308.

18.1. (Repealed).

1995, c. 1, s. 254; 1995, c. 63, s. 308.

DIVISION II SUPPLY AND COMMERCIAL ACTIVITY

§ 1 . — Supply

I.  — Rules relating to a supply

19. (Repealed).

1991, c. 67, s. 19; 1995, c. 63, s. 309.

20. (Repealed).

1991, c. 67, s. 20; 1995, c. 63, s. 310.

20.1. A supply made otherwise than in the course of a commercial activity of a road vehicle that must be registered under the Highway Safety Code (chapter C-24.2) following an application by the recipient of the supply is deemed to be a taxable supply.

1993, c. 19, s. 172; 1995, c. 63, s. 311.

II.  — Presumptions respecting place of supply

21. (Repealed).

1991, c. 67, s. 21; 1994, c. 22, s. 371; 1995, c. 1, s. 255; 1997, c. 85, s. 429.

22. (Repealed).

1991, c. 67, s. 22; 1997, c. 85, s. 429.

22.1. (Repealed).

1994, c. 22, s. 372; 1997, c. 85, s. 429.

1.  — Definitions and interpretation

1997, c. 85, s. 430.

22.2. For the purposes of sections 22.2 to 22.30,

“lease interval”, in respect of a supply by way of lease, licence or similar arrangement, has the meaning assigned by section 32.2;

“place of negotiation” of a supply means the location of the supplier’s permanent establishment at which the individual principally involved in negotiating for the supplier the agreement for the supply ordinarily works, or to which that individual ordinarily reports, in the performance of the individual’s duties in relation to the activities of the supplier in the course of which the supply is made and, for the purposes of this definition, “negotiating” includes the making or acceptance of an offer;

“province” means a province of Canada and includes

(1)  the Northwest Territories;

(2)  the Yukon Territory;

(3)  the Nova Scotia offshore area within the meaning of the Canada — Nova Scotia Offshore Petroleum Resources Accord Implementation Act (Statutes of Canada, 1988, chapter 28), to the extent that that area is a participating province within the meaning assigned by subsection 1 of section 123 of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15);

(4)  the Newfoundland offshore area, within the meaning of the Canada — Newfoundland Atlantic Accord Implementation Act (Statutes of Canada, 1987, chapter 3), to the extent that that area is a participating province within the meaning assigned by subsection 1 of section 123 of the Excise Tax Act.

1997, c. 85, s. 430.

22.3. For the purposes of sections 22.2 to 22.30, a floating home, and a mobile home that is not affixed to land are each deemed to be corporeal movable property and not immovables.

1997, c. 85, s. 430.

22.4. For the purposes of sections 22.2 to 22.30, where an agreement for the supply of property or a service is entered into but the property is not delivered to the recipient or the service is not performed, the property is deemed to have been delivered, or the service is deemed to have been performed, where the property or service was to be delivered or performed, as the case may be, under the terms of the agreement.

1997, c. 85, s. 430.

22.5. Where, for the purpose of determining, under sections 22.2 to 22.30, if a supply is made in Québec, reference is made to the ordinary location of property and, from time to time, the supplier and the recipient mutually agree upon what is to be the ordinary location of the property at a particular time, that location is deemed, for the purposes of sections 22.2 to 22.30, to be the ordinary location of that property at the particular time.

1997, c. 85, s. 430.

22.6. Sections 22.7 to 22.30 apply subject to sections 23, 24.2, 327.2 and 327.3.

1997, c. 85, s. 430.

2.  — Corporeal movable property

1997, c. 85, s. 430.

22.7. A supply of corporeal movable property by way of sale is deemed to be made in Québec if the property is delivered in Québec to the recipient of the supply.

1997, c. 85, s. 430.

22.8. A supply of corporeal movable property otherwise than by way of sale is deemed to be made in Québec if

(1)  in the case of a supply made under an agreement under which continuous possession or use of the property is provided for a period of not more than three months, the property is delivered in Québec to the recipient of the supply; and

(2)  in any other case,

(a)  where the property is a road vehicle, it is required, at the time the supply is made, to be registered under the Highway Safety Code (chapter C-24.2),

(b)  where the property is not a road vehicle, the ordinary location of the property, as determined at the time the supply is made, is in Québec, and

(c)  where the possession or use of the property is given or made available in Québec to the recipient and the property is neither property referred to in subparagraph a or b nor

i.  property that is a specified motor vehicle within the meaning of subsection 1 of section 123 of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15) that is required, at the time the supply is made, to be registered under the laws of another province relating to the registration of motor vehicles, or

ii.  property, other than a specified motor vehicle referred to in subparagraph i, the ordinary location of which, as determined at the time the supply is made, is in another province.

Notwithstanding the first paragraph, a supply of corporeal movable property otherwise than by way of sale is deemed to be made outside Québec if possession or use of the property is given or made available outside Canada to the recipient.

1997, c. 85, s. 430; 1998, c. 16, s. 310.

22.9. Property is deemed to be delivered

(1)  in Québec where the supplier

(a)  ships the property to a destination in Québec that is specified in the contract for carriage of the property or transfers possession of the property to a common carrier or consignee that the supplier has retained on behalf of the recipient to ship the property to such a destination, or

(b)  sends the property by mail or courier to an address in Québec; and

(2)  outside Québec where the supplier

(a)  ships the property to a destination in another province that is specified in the contract for carriage of the property or transfers possession of the property to a common carrier or consignee that the supplier has retained on behalf of the recipient to ship the property to such a destination, or

(b)  sends the property by mail or courier to an address in another province.

The first paragraph does not apply where the property is corporeal movable property supplied by way of sale that is, or is to be, delivered outside Canada to the recipient.

1997, c. 85, s. 430; 2001, c. 51, s. 261.

22.9.1. For the purposes of section 22.8, if a supply of corporeal movable property is made by way of lease, licence or similar arrangement,

(1)  where the supply is made under an arrangement under which continuous possession or use of the property is provided for a period of not more than three months and the property is delivered in Québec to the recipient, the property is deemed to be delivered in Québec for each of the supplies which, because of section 32.2, is deemed to be made;

(2)  where the supply is not referred to in paragraph 1 and continuous possession or use of the property is given or made available in Québec to the recipient, possession or use of the property is deemed to be given or made available in Québec to the recipient for each of the supplies which, because of section 32.2, is deemed to be made; and

(3)  where possession or use of the property is given or made available outside Canada to the recipient, possession or use of the property is deemed to be given or made available outside Canada to the recipient for each of the supplies which, because of section 32.2, is deemed to be made.

2001, c. 53, s. 276.

3.  — Incorporeal movable property

1997, c. 85, s. 430.

22.10. For the purposes of section 22.11, “Canadian rights” in respect of incorporeal movable property means that part of the property that can be used in Canada.

1997, c. 85, s. 430.

22.11. A supply of incorporeal movable property is deemed to be made in Québec if

(1)   in the case of property that relates to an immovable,

(a)  that part of the immovable that is situated in Canada is all or substantially all situated in Québec,

(b)  the place of negotiation of the supply is in Québec and it is not the case that all or substantially all of the immovable is situated outside Québec, or

(c)  that part of the immovable that is situated in Canada is situated primarily in Québec and

i.  where the place of negotiation of the supply is outside Canada, all or substantially all of the immovable is situated in Canada, and

ii.  where the place of negotiation of the supply is situated in another province, all or substantially all of the immovable is situated outside that province;

(2)  in the case of property that relates to corporeal movable property,

(a)  that part of the corporeal movable property that is ordinarily located in Canada is all or substantially all ordinarily located in Québec,

(b)  the place of negotiation of the supply is in Québec and it is not the case that all or substantially all of the corporeal movable property is ordinarily located outside Québec, or

(c)  that part of the corporeal movable property that is ordinarily located in Canada is ordinarily located primarily in Québec and

i.  where the place of negotiation of the supply is outside Canada, all or substantially all of the movable property is ordinarily located in Canada, and

ii.  where the place of negotiation of the supply is in another province, all or substantially all of the movable property is ordinarily located outside that province;

(3)  in the case of property that relates to services that are to be performed,

(a)  all or substantially all of the services that are to be performed in Canada are to be performed in Québec,

(b)  the place of negotiation of the supply is in Québec and it is not the case that all or substantially all of the services are to be performed outside Québec, or

(c)   the services that are to be performed in Canada are to be performed primarily in Québec and

i.  where the place of negotiation of the supply is outside Canada, all or substantially all of the services are to be performed in Canada, and

ii.  where the place of negotiation of the supply is in another province, all or substantially all of the services are to be performed outside that province; and

(4)  in any other case,

(a)  all or substantially all of the Canadian rights in respect of the property can be used only in Québec,

(b)  the place of negotiation of the supply is in Québec and the property can be used otherwise than exclusively outside Québec, or

(c)  the Canadian rights in respect of the incorporeal movable property cannot be used otherwise than primarily in Québec and

i.  where the place of negotiation of the supply is outside Canada, the property cannot be used otherwise than exclusively in Canada, and

ii.  where the place of negotiation of the supply is in another province, the property cannot be used otherwise than exclusively outside that province.

1997, c. 85, s. 430.

4.  — Immovable

1997, c. 85, s. 430.

22.12. A supply of an immovable is deemed to be made in Québec if the immovable is situated in Québec.

1997, c. 85, s. 430.

22.13. A supply of a service in relation to an immovable is deemed to be made in Québec if

(1)  all or substantially all of the immovable that is situated in Canada is situated in Québec;

(2)  the place of negotiation of the supply is in Québec and it is not the case that all or substantially all of the immovable is situated outside Québec; or

(3)  all or substantially all of the immovable that is situated in Canada is situated primarily in Québec, unless

(a)  the place of negotiation of the supply is outside Canada and it is not the case that all or substantially all of the immovable is situated in Canada, or

(b)  the place of negotiation of the supply is in another province and it is not the case that all or substantially all of the immovable is situated outside that province.

1997, c. 85, s. 430.

5.  — Service

1997, c. 85, s. 430.

22.14. For the purposes of section 22.15, “Canadian element” of a service means the portion of the service that is performed in Canada.

1997, c. 85, s. 430.

22.15. A supply of a service, other than a service referred to in sections 22.13 and 22.16 to 22.27, is deemed to be made in Québec if

(1)  all or substantially all of the Canadian element of the service is performed in Québec;

(2)  the place of negotiation of the supply is in Québec and it is not the case that all or substantially all of the service is performed outside Québec; or

(3)  the Canadian element of the service is performed primarily in Québec, unless

(a)  the place of negotiation of the supply is outside Canada and it is not the case that all or substantially all of the service is performed in Canada, or

(b)  the place of negotiation of the supply is in another province and it is not the case that all or substantially all of the service is performed outside that province.

1997, c. 85, s. 430; 1998, c. 16, s. 310.

22.15.1. For the purposes of this subdivision, if section 32.3 applies in respect of the supply of a service and the service is performed in part in Québec and in part outside Canada, the part of the service that is performed outside Canada is deemed to be performed in Québec.

2001, c. 53, s. 277.

6.  — Transportation service

1997, c. 85, s. 430.

22.16. For the purposes of this section and sections 22.17 to 22.20,

“continuous journey” has the meaning assigned by section 193;

“destination” of a freight transportation service means the place specified by the shipper of the property where possession of the property is transferred to the person to whom the property is consigned or addressed by the shipper;

“freight transportation service” has the meaning assigned by section 193;

“origin” of a continuous journey has the meaning assigned by section 193;

“stopover”, in respect of a continuous journey, has the meaning assigned by section 193 except that it does not include, in the case of a continuous journey of an individual or group of individuals that does not include transportation by air and the origin and termination of which are in Canada, any place outside Canada where, at the time the journey begins, the individual or group is not scheduled to be outside Canada for an uninterrupted period of at least 24 hours during the course of the journey;

“termination” of a continuous journey has the meaning assigned by section 193.

1997, c. 85, s. 430.

22.17. A supply of a passenger transportation service that is part of a continuous journey is deemed to be made in Québec if

(1)  where the ticket or voucher issued in respect of the passenger transportation service included in the continuous journey that is provided first specifies the origin of the continuous journey, the origin is a place in Québec and the termination, and all stopovers, in respect of the continuous journey are in Canada; or

(2)  in any other case, the place of negotiation of the supply is in Québec.

1997, c. 85, s. 430.

22.18. A supply of any of the following services by a person, in connection with the supply by that person of a passenger transportation service, is deemed to be made in Québec if the supply of the passenger transportation service is made in Québec:

(1)  a service of transporting an individual’s baggage; and

(2)  a service of supervising an unaccompanied child.

1997, c. 85, s. 430; 2001, c. 53, s. 278.

22.18.1. A supply by a person of a service of issuing, delivering, amending, replacing or cancelling a ticket, voucher or reservation for a supply by that person of a passenger transportation service is deemed to be made in Québec if the supply of the passenger transportation service would be made in Québec if it were completed in accordance with the agreement relating to that supply.

2001, c. 53, s. 279.

22.19. Subject to sections 22.21 to 22.24, a supply of a freight transportation service is deemed to be made in Québec if the destination of the service is in Québec.

1997, c. 85, s. 430.

22.20. A supply of a freight transportation service made from a place in Québec to a place outside Canada is deemed to be made in Québec.

1997, c. 85, s. 430.

7.  — Postal service

1997, c. 85, s. 430.

22.21. For the purposes of this section and sections 22.22 to 22.24,

“permit imprint” means an indicia the use of which as evidence of the payment of postage exclusively by a person is authorized under an agreement between the Canada Post Corporation and the person, but does not include a postage meter impression or any “business reply” indicia or item bearing that indicia;

“postage stamp” means a stamp authorized by the Canada Post Corporation for use as evidence of the payment of postage, but does not include a postage meter impression, a permit imprint or any “business reply” indicia or item bearing that indicia.

1997, c. 85, s. 430.

22.22. A supply of a postage stamp or a postage-paid card, package or similar item, other than an item bearing a “business reply” indicia, that is authorized by the Canada Post Corporation is deemed to be made in Québec if the supplier delivers the stamp or item in Québec to the recipient of the supply and, where the stamp or item is used as evidence of the payment of postage for a mail delivery service, the supply of the service is deemed to be made in Québec, unless

(1)  the supply of the service is made pursuant to a bill of lading; or

(2)  the consideration for the supply of the service is $5 or more, without reference to tax paid or payable under Part IX of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15), and the address to which the mail is sent is not in Québec.

1997, c. 85, s. 430.

22.23. Where the payment of postage for a mail delivery service supplied by the Canada Post Corporation is evidenced by a postage meter impression printed by a meter, the supply of the service is deemed to be made in Québec if the ordinary location of the meter, as determined at the time the recipient of the supply pays an amount to the Corporation for the purpose of paying that postage, is in Québec, unless the supply is made pursuant to a bill of lading.

1997, c. 85, s. 430.

22.24. Where the payment of postage for a mail delivery service supplied by the Canada Post Corporation otherwise than pursuant to a bill of lading is evidenced by a permit imprint, the supply of the service is deemed to be made in Québec if the recipient of the supply deposits the mail in Québec with the Corporation in accordance with the agreement between the recipient and the Corporation authorizing the use of the permit imprint.

1997, c. 85, s. 430.

8.  — Telecommunication service

1997, c. 85, s. 430.

22.25. For the purposes of section 22.26, the billing location for a telecommunication service supplied to a recipient is in Québec if

(1)  where the consideration paid or payable for the service is charged or applied to an account that the recipient has with a person who carries on the business of supplying telecommunication services and the account relates to a telecommunications facility that is used or is available for use by the recipient to obtain telecommunication services, that telecommunications facility is ordinarily located in Québec; and

(2)  in any other case, the telecommunications facility used to initiate the service is located in Québec.

1997, c. 85, s. 430.

22.26. A supply of a telecommunication service, other than a service referred to in section 22.27, is deemed to be made in Québec if,

(1)  in the case of a telecommunication service of making telecommunications facilities available to a person,

(a)  all of those facilities are ordinarily located in Québec,

(b)  part of the facilities is ordinarily located in Québec and the other part thereof is ordinarily located outside Canada, or

(c)  where not all of the telecommunications facilities are ordinarily located in Québec, any part of the facilities is ordinarily located in another province and

i.  the invoice for the supply of the service is sent to an address in Québec, or

ii.  in any other case, no tax of the same nature as the tax payable under this Title is imposed on the person by the other province in respect of the supply of the service or, if such tax is imposed by that province, the person is entitled to obtain a rebate thereof; or

(2)  in any other case,

(a)  the telecommunication is emitted and received in Québec,

(b)  the telecommunication is emitted or received in Québec and the billing location for the service is in Québec, or

(c)  the telecommunication is emitted in Québec and is received outside Québec and

i.  where the telecommunication is received outside Canada, the billing location is in another province, or

ii.  where the telecommunication is received in another province, the billing location is not in that province.

1997, c. 85, s. 430; 2002, c. 9, s. 153.

22.27. A supply of a telecommunication service of granting to the recipient of the supply sole access to a telecommunications channel, within the meaning of section 32.6, for transmitting telecommunications between a place in Québec and a place outside Québec but within Canada is deemed to be made in Québec.

1997, c. 85, s. 430.

9.  — Deemed supply and prescribed supply

1997, c. 85, s. 430.

22.28. Notwithstanding sections 22.7 to 22.27, a supply of property that is deemed under any of sections 207 to 210.4, 238.1, 285 to 287.3, 298, 300, 320, 323.1, 325 and 337.2 to 341.9 to have been made or received at any time is deemed to be made in Québec if the property is situated in Québec at that time.

1997, c. 85, s. 430; 2001, c. 51, s. 262.

22.29. Notwithstanding sections 22.7 to 22.27, a supply of property or a service is deemed to be made in Québec if the supply is deemed to be made in Québec under another provision of this Title or a provision of the Regulation respecting the Québec sales tax (Order in Council 1607-92 (1992, G.O. 2, 4952)) with amendments and future amendments.

1997, c. 85, s. 430.

22.30. Notwithstanding sections 22.7 to 22.27, a prescribed supply of property or a service is deemed to be made in Québec.

1997, c. 85, s. 430.

22.31. Notwithstanding sections 22.13 to 22.27, a supply of a service is deemed to be made outside Québec if it is a supply of a prescribed service.

1997, c. 85, s. 430.

10.  — Special rules

1997, c. 85, s. 430.

22.32. A supply that is not deemed to be made in Québec under sections 22.7 to 22.24 and 22.28 to 22.30 is deemed to be made outside Québec.

1997, c. 85, s. 430.

23. A supply of movable property or a service made in Québec by a person who is not resident in Québec is deemed to be made outside Québec, unless

(1)  the supply is made in the course of a business carried on in Québec;

(2)  at the time the supply is made, the person is registered under Division I of Chapter VIII; or

(3)  the supply is the supply of an admission in respect of an activity, a seminar, an event or a place of amusement where the non-resident person did not acquire the admission from another person.

1991, c. 67, s. 23.

24. (Repealed).

1991, c. 67, s. 24; 1994, c. 22, s. 373.

24.1. Notwithstanding sections 22.32 and 23, a supply of prescribed corporeal movable property made by a person who is registered under Division I of Chapter VIII is deemed to be made in Québec if the property is sent, by mail or courier, to the recipient of the supply at an address in Québec.

1994, c. 22, s. 374; 1997, c. 85, s. 431.

24.2. The following are deemed made outside Québec:

(1)  a supply of a freight transportation service in respect of the transportation of corporeal movable property from a place in Canada outside Québec to a place in Québec;

(2)  a supply of a freight transportation service in respect of the transportation of corporeal movable property between two places in Québec where the service is part of a continuous freight movement, within the meaning of section 193, from a place in Canada outside Québec to a place in Québec and where the supplier of the service maintains documentary evidence satisfactory to the Minister that the service is part of a continuous freight movement from a place in Canada outside Québec to a place in Québec.

1994, c. 22, s. 374; 1997, c. 85, s. 432.

24.3. Except for the purposes of sections 182, 191.3.3 and 191.3.4, a continuous transmission commodity that is transported by means of a wire, pipeline or other conduit is deemed not to be shipped outside Québec or brought into Québec in the course of that transportation or further transportation if the commodity is transported

(1)  outside Québec in the course of, and solely for the purpose of, being delivered by that means from a place in Québec to another place in Québec;

(2)  in Québec in the course of, and solely for the purpose of, being delivered by that means from a place outside Québec to another place outside Québec;

(3)  from a place in Québec to a place outside Québec where it is stored or taken up as surplus for a period until further transported by that means to a place in Québec in the same measure and state except to the extent of any consumption or alteration necessary or incidental to its transportation; or

(4)  from a place outside Québec to a place in Québec where it is stored or taken up as surplus for a period until further transported by that means to a place outside Québec in the same measure and state except to the extent of any consumption or alteration necessary or incidental to its transportation.

2001, c. 53, s. 280.

III.  — Other presumptions

1.  — General provisions

1994, c. 22, s. 375.

25. Where a person carries on a business through a permanent establishment of the person in Québec and through another permanent establishment of the person outside Québec,

(1)  any transfer of movable property or rendering of a service by the permanent establishment in Québec to the permanent establishment outside Québec is deemed to be a supply of the property or service; and

(2)  in respect of that supply, the permanent establishments are deemed to be separate persons who deal with each other at arm’s length.

1991, c. 67, s. 25.

26. For the purposes of sections 18 and 18.0.1, where a person carries on a business through a permanent establishment of the person in Québec and through another permanent establishment outside Québec,

(1)  any transfer of movable property or rendering of a service by one permanent establishment to the other permanent establishment is deemed to be a supply of the property or service;

(2)  in respect of that supply, the permanent establishments are deemed to be separate persons who deal with each other at arm’s length;

(3)  the value of the consideration for that supply is deemed to be equal to the fair market value of the supply at the time the property is so transferred or the service is so rendered; and

(4)  the consideration for that supply is deemed to have become due and to have been paid, by the permanent establishment (in this paragraph referred to as “the recipient”) to which the property was transferred or the service was rendered, to the other permanent establishment at the end of the taxation year of the recipient in which the property was transferred or the service was rendered.

1991, c. 67, s. 26; 1994, c. 22, s. 376; 1997, c. 85, s. 433.

26.1. For the purposes of sections 25 and 26, “permanent establishment” has the meaning assigned by section 11.2 where a person is resident in Québec otherwise than by reason of section 12.

1997, c. 85, s. 434.

27. Where an agreement is entered into to provide property or a service,

(1)  the entering into of the agreement is deemed to be a supply of the property or service made at the time the agreement is entered into; and

(2)  any provision of property or a service under the agreement is deemed to be part of the supply referred to in paragraph 1 and not a separate supply.

1991, c. 67, s. 27.

28. Where, under an agreement entered into in respect of a debt or obligation, a person transfers property or an interest in property for the purpose of securing payment of the debt or performance of the obligation, the transfer is deemed not to be a supply.

Where, on payment of the debt or performance of the obligation or the extinguishing of the debt or obligation, the property or interest is retransferred, the retransfer of the property or interest is deemed not to be a supply.

1991, c. 67, s. 28.

29. Where a public sector body makes a supply of a service, or a supply of the use by way of licence of a copyright, trade-mark, trade-name or other similar property of the body, to a person who is the sponsor of an activity of the body for use by the person exclusively in publicizing the person’s business, the supply by the body of the service or the use of the property is deemed not to be a supply.

This section does not apply where it may reasonably be regarded that the consideration for the supply is primarily for a service of advertising by means of radio or television or in a newspaper, magazine or other publication published periodically, or for a prescribed service.

1991, c. 67, s. 29; 1997, c. 85, s. 435.

30. A supply, by way of lease, licence or similar arrangement, of the use or right to use an immovable or corporeal movable property is deemed to be a supply of an immovable or corporeal movable property, as the case may be.

1991, c. 67, s. 30.

30.0.1. A supply of movable property delivered electronically is deemed to be a supply of incorporeal movable property.

2002, c. 9, s. 154.

30.1. (Repealed).

1993, c. 19, s. 173; 1995, c. 63, s. 312.

31. Where a supply of an immovable includes the provision of a property described in subparagraph 1 of the second paragraph and a property described in subparagraph 2 of that paragraph,

(1)  the property described in subparagraph 1 of the second paragraph and the property described in subparagraph 2 of that paragraph are each deemed to be a separate property;

(2)  the provision of the property described in subparagraph 1 of the second paragraph is deemed to be a supply separate from the provision of the property described in subparagraph 2 of that paragraph; and

(3)  neither supply is incidental to the other.

The property referred to in the first paragraph is

(1)  an immovable that is

(a)  a residential complex,

(b)  land, a building or part of a building that forms or is reasonably expected to form part of a residential complex, or

(c)  a residential trailer park; or

(2)  another immovable that is not part of an immovable referred to in subparagraph 1.

1991, c. 67, s. 31; 1994, c. 22, s. 377; 1997, c. 85, s. 436.

31.1. (Repealed).

1994, c. 22, s. 378; 1997, c. 85, s. 437.

32. Where a builder of an addition to a multiple unit residential complex makes a supply of the complex or an interest in it by way of sale that, but for this section, would be a taxable supply and, but for the construction of the addition, would be an exempt supply described in section 97,

(1)  the addition and the remainder of the complex are each deemed to be a separate property;

(2)  the sale of the addition or interest in it is deemed to be a supply separate from the sale of the remainder of the complex or interest in it; and

(3)  neither supply is incidental to the other.

1991, c. 67, s. 32; 1994, c. 22, s. 379.

32.1. Where a person who has increased the area of land included in a residential trailer park of the person (in this section referred to as the “additional area”) makes a supply of the park or an interest in it that, but for this section, would be a taxable supply and, but for the additional area, would be an exempt supply described in section 97.3,

(1)  the additional area and the remainder of the park are each deemed to be a separate property;

(2)  the sale of the additional area or the interest therein is deemed to be a supply separate from the sale of the remainder of the park or the interest in the park; and

(3)  neither supply is incidental to the other.

1994, c. 22, s. 380.

32.2. Where a supply of property is made by way of lease, licence or similar arrangement to a person for consideration that includes a payment that is attributable to a period (in this section referred to as the “lease interval”) that is the whole or a part of the period during which possession or use of the property is provided under the arrangement,

(1)  the supplier is deemed to have made, and the person is deemed to have received, a separate supply of the property for the lease interval;

(2)  the supply of the property for the lease interval is deemed to be made on the earliest of

(a)  the first day of the lease interval,

(b)  the day on which the payment that is attributable to the lease interval becomes due, and

(c)  the day on which the payment that is attributable to the lease interval is made; and

(3)  the payment that is attributable to the lease interval is deemed to be consideration payable in respect of the supply of the property for the lease interval.

1997, c. 85, s. 438.

32.2.1. If a recipient of a supply by way of lease, licence or similar arrangement of corporeal movable property exercises an option to purchase the property that is provided for under the arrangement and the recipient begins to have possession of the property under the agreement of purchase and sale of the property at the same time and place as the recipient ceases to have possession of the property as lessee or licensee under the arrangement, that time and place is deemed to be the time and place at which the property is delivered to the recipient in respect of the supply by way of sale of the property to the recipient.

2001, c. 53, s. 281.

32.3. Where a supply of a service is made to a person for consideration that includes a payment that is attributable to a period (in this section referred to as the “billing period”) that is the whole or a part of the period during which the service is or is to be rendered under the agreement for the supply,

(1)  the supplier is deemed to have made, and the person is deemed to have received, a separate supply of the service for the billing period;

(2)  the supply of the service for the billing period is deemed to be made on the earliest of

(a)  the first day of the billing period,

(b)  the day on which the payment that is attributable to the billing period becomes due, and

(c)  the day on which the payment that is attributable to the billing period is made; and

(3)  the payment that is attributable to the billing period is deemed to be consideration payable in respect of the supply of the service for the billing period.

1997, c. 85, s. 438.

32.4. Where a taxable supply of an immovable includes the provision of an immovable of which part is situated in Québec and another part is situated outside Québec but within Canada, for the purpose of determining whether a taxable supply of the immovable is made in Québec and determining the tax payable, if any, under section 16 in respect of the supply,

(1)  the provision of the part of the immovable that is situated in Québec and the provision of the part of the immovable that is situated outside Québec are each deemed to be a separate taxable supply made for separate consideration; and

(2)  the supply of the part of the immovable that is situated in Québec is deemed to be made for consideration equal to the portion of the total consideration for all of the immovable that may reasonably be attributed to that part.

1997, c. 85, s. 438.

32.5. For the purpose of determining the tax payable under section 16 in respect of a supply of a freight transportation service, within the meaning of section 193, that includes the provision of a service of transporting particular corporeal movable property to a destination in Québec and other corporeal movable property to a destination outside Québec but within Canada and determining whether the supply of the service is made in Québec,

(1)  the provision of the service of transporting the particular property and the provision of the service of transporting the other property are each deemed to be a separate supply made for separate consideration; and

(2)  the supply of the service of transporting the particular property is deemed to be made for consideration equal to the portion of the total consideration that may reasonably be attributed to the transportation of the particular property.

1997, c. 85, s. 438.

32.6. For the purposes of section 32.7, “telecommunications channel” means a telecommunications circuit, line, frequency, channel, partial channel or other means of sending or receiving a telecommunication but does not include a satellite channel.

1997, c. 85, s. 438.

32.7. Where a person supplies a telecommunication service of granting to the recipient of the supply sole access to a telecommunications channel for transmitting telecommunications between a place in Québec and a place outside Québec but within Canada, the consideration for the supply of the service is deemed to be equal to the amount determined by the formula

(A / B) × C.

For the purposes of this formula,

(1)  A is the distance over which the telecommunications would be transmitted in Québec if the telecommunications were transmitted solely by means of cable and related telecommunications facilities located in Canada that connected, in a direct line, the transmitters for emitting and receiving the telecommunications;

(2)  B is the distance over which the telecommunications would be transmitted in Canada if the telecommunications were transmitted solely by such means; and

(3)  C is the total consideration paid or payable by the recipient for the sole access to the telecommunications channel.

1997, c. 85, s. 438.

33. Where corporeal movable property is supplied in a covering or container that is usual for that class of property, the covering or container is deemed to form part of the property so supplied.

1991, c. 67, s. 33.

34. Where a particular property or service is supplied together with any other property or service for a single consideration, and it may reasonably be regarded that the provision of the other property or service is incidental to the provision of the particular property or service, the other property or service is deemed to form part of the particular property or service so supplied.

1991, c. 67, s. 34; 1993, c. 19, s. 174; 1995, c. 1, s. 256.

34.1. (Repealed).

1993, c. 19, s. 175; 1995, c. 63, s. 313.

34.2. (Repealed).

1993, c. 19, s. 175; 1994, c. 22, s. 381; 1995, c. 63, s. 313.

34.3. (Repealed).

1993, c. 19, s. 175; 1995, c. 1, s. 257.

34.4. (Repealed).

1994, c. 22, s. 382; 1995, c. 1, s. 358.

35. Where a listed financial institution makes a supply of one or more financial services together with one or more other services that are not financial services, or with properties that are not capital properties of the institution, for a single consideration, the supply of each of the services and properties is deemed to be a supply of a financial service if

(1)  the financial services are related to the other services or the properties, as the case may be;

(2)  it is the usual practice of the listed financial institution to supply those or similar services, or those or similar properties and services, together in the ordinary course of the business of the institution; and

(3)  the amount which would be the consideration for the financial service so supplied if that financial service had been supplied separately, is greater than 50% of the amount which would be the consideration for a service or property so supplied if that service or property had been supplied separately.

The first paragraph applies only to a supply to which section 139 of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15) applies.

1991, c. 67, s. 35; 1994, c. 22, s. 383.

36. Where a person makes a supply of a share, bond or other security that represents capital stock or debt of a particular organization, and ownership of the security by the recipient of the supply is a condition of the recipient’s, or another person’s, obtaining a membership, or a right to acquire a membership, in the particular organization or in another organization that is related to the particular organization, the supply of the security is deemed to be a supply of a membership and not a supply of a financial service.

A share in a credit union or in a cooperative corporation the main purpose of which is not to provide recreational, sporting or dining facilities is not a security for the purposes of the first paragraph.

1991, c. 67, s. 36; 1994, c. 22, s. 384; 1997, c. 3, s. 117.

37. (Repealed).

1991, c. 67, s. 37; 1994, c. 22, s. 385.

38. (Repealed).

1991, c. 67, s. 38; 1994, c. 22, s. 385.

39. Notwithstanding section 35, where a discounter within the meaning of the Tax Rebate Discounting Act (Revised Statutes of Canada, 1985, chapter T-3) pays an amount to a person to acquire from that person a right to a refund of tax within the meaning of that Act,

(1)  the discounter is deemed to have made a taxable supply of a service for consideration equal to the lesser of $30 and 2/3 of the amount by which the amount of the refund exceeds the amount paid by the discounter to the person to acquire the right; and

(2)  the discounter is deemed to have made a separate supply of a financial service for consideration equal to the amount by which the amount of the refund exceeds the total of the amount paid by the discounter to the person to acquire the right and the amount determined under paragraph 1.

1991, c. 67, s. 39.

39.1. For the purposes of section 39.2, “feed” means

(1)  grain or seed that is described in paragraph 2 of section 178 and used as feed for farm livestock that is ordinarily raised or kept to produce, or to be used as, food for human consumption or to produce wool;

(2)  feed that is a complete feed, supplement, macro-premix, micro-premix or mineral feed, other than a trace mineral salt feed, the supply of which in bulk quantities of at least 20 kg would be a zero-rated supply included in Division IV of Chapter IV; and

(3)  by-products of the food processing industry and plant or animal products, the supply of which in bulk quantities of at least 20 kg would be a zero-rated supply included in Division IV of Chapter IV.

1994, c. 22, s. 386; 1995, c. 1, s. 258.

39.2. Where, in the course of operating a feedlot that is a farming business within the meaning of the Taxation Act (chapter I-3), a person makes a supply of a service and the consideration for the supply (in this section referred to as the “total charge”) includes a particular amount that is identified in the invoice or agreement in writing for the supply as being attributable to feed,

(1)  the provision of the feed is deemed to be a supply separate from the supply of the service and not to be incidental to the provision of any other property or service;

(2)  the portion, not exceeding 90%, of the total charge that is reasonably attributable to the feed and is included in the particular amount is deemed to be the consideration for the supply of the feed; and

(3)  the difference between the total charge and the consideration for the supply of the feed is deemed to be the consideration for the supply of the service.

1994, c. 22, s. 386.

39.3. For the purposes of sections 39.3 to 41,

“estimated reserves” of minerals means the estimated quantities of minerals that geological and engineering data demonstrate, with reasonable certainty, to be recoverable under existing economic and operating conditions;

“farm-out agreement” means an agreement referred to in section 39.4;

“natural resource right” means

(1)  a right to exploit a mineral deposit;

(2)  a right to explore for a mineral deposit;

(3)  a right of entry or user relating to a right referred to in paragraph 1 or 2; or

(4)  a right to an amount computed by reference to the production, including profit, from, or to the value of production from, a mineral deposit;

“specified mining or well-site equipment”, in relation to the exploration or development of unproven property under a farm-out agreement, means

(1)  equipment, installations and structures for use at a mine site in the production of minerals from the mine and not in the milling, smelting, refining or other processing of the minerals after production; and

(2)  equipment, installations and structures for use at a well site in the production of minerals from the well, including a heater, dehydrator or other well-site facility for the initial treatment of substances produced from the well to prepare such production for transportation but excluding

(a)  any equipment, installation, structure or facility that serves or is intended to serve a well that has not been drilled in the course of the exploration or development under that agreement, and

(b)  any equipment, installation, structure or facility for use in the refining of oil or the processing of natural gas including the separation therefrom of liquid hydrocarbons, sulphur or other joint products or by-products;

“unproven property” means an immovable for which estimated reserves of minerals have not been established.

2001, c. 53, s. 282.

39.4. If, under an agreement in writing between a person (in this section referred to as the “farmor”) and another person (in this section referred to as the “farmee”), the farmor transfers to the farmee particular natural resource rights, or portions of them, relating to unproven property in consideration or part consideration for the farmee undertaking the exploration of the property for mineral deposits, providing information, or the right to it, gathered from the exploration and, subject to any conditions that may be provided in the agreement, developing the property for the production of minerals, the following rules apply:

(1)  the value, as consideration, of any property or service given by the farmor to the farmee under the agreement is deemed to be nil to the extent that the property or service is given as consideration for any of the following (each of which is referred to in this section as the “farmee’s contribution”):

(a)  the undertaking of that exploration or development,

(b)  the provision of that information, or the right to it, and

(c)  any transfer under the agreement by the farmee to the farmor of any interest in specified mining or well-site equipment that is used by the farmee exclusively in that exploration or development;

(2)  the value of the farmee’s contribution as consideration for any property or service given by the farmor to the farmee under the agreement is deemed to be nil; and

(3)  if part of the consideration given by the farmor for the farmee’s contribution is property or a service (each of which is referred to in this paragraph as the “farmor’s additional contribution”) that is not a natural resource right relating to unproven property,

(a)  the farmee is deemed to have made, at the place at which the unproven property is situated, a taxable supply of a service to the farmor separate from any supply by the farmee under the agreement and that service is deemed to be consideration for the farmor’s additional contribution,

(b)   the value of that service and the value of the farmor’s additional contribution as consideration for the supply of that service are each deemed to be equal to the fair market value of the farmor’s additional contribution determined at the time (in this paragraph referred to as the “time of transfer”) that

i.  if the farmor’s additional contribution is a service, performance of the service commences, and

ii.  in any other case, ownership of the farmor’s additional contribution is transferred to the farmee,

(c)  all of the consideration for the farmor’s additional contribution and the consideration for the service deemed to have been supplied by the farmee are deemed to become due at the time of transfer, and

(d)  if, in addition to the farmee’s contribution, the farmee supplies to the farmor other property or services, other than the service deemed under subparagraph a to have been supplied, for which part of the consideration is the farmor’s additional contribution, the value of the consideration for the supply of the other property or services is deemed to be equal to the amount by which the value of that consideration, determined without reference to this subparagraph, exceeds the fair market value of the farmor’s additional contribution.

2001, c. 53, s. 282.

40. The supply of the following rights is deemed not to be a supply:

(1)  any right to exploit any mineral deposits, peat bogs or deposits of peat or any forestry, fishery or water resources;

(2)   any right to explore relating to the deposits, peat bogs or resources referred to in subparagraph 1;

(3)  any right of entry or user relating to a right referred to in subparagraph 1 or 2; or

(4)  any right to an amount computed by reference to the production, including profit, from, or to an amount computed by reference to the value of production from, the deposits, peat bogs or resources referred to in subparagraph 1.

Any consideration paid or due, or any fee or royalty charged or reserved, in respect of a right referred to in the first paragraph is deemed not to be consideration for the right.

1991, c. 67, s. 40; 1994, c. 22, s. 387.

41. Section 40 does not apply to a supply of a right to take or remove forestry products, products that grow in water, fishery products, minerals or peat or to any right of entry or user relating thereto, where the supply is made

(1)  to a consumer; or

(2)  to a person who is not a registrant and who acquires the right in the course of a business of the person to make supplies of the products, minerals or peat to consumers.

1991, c. 67, s. 41; 1994, c. 22, s. 387.

2.  — Mandatary

1994, c. 22, s. 388.

41.0.1. Where a registrant, in the course of a commercial activity of the registrant, acts as mandatary in making a supply, otherwise than by auction, on behalf of a person who is required to collect tax in respect of the supply otherwise than as a consequence of the application of paragraph 1 of section 41.1 and the registrant and the person jointly elect in prescribed form containing prescribed information, the following rules apply:

(1)  the tax collectible in respect of the supply shall be included in determining the net tax of the registrant and not of the person as if the tax were collectible by the registrant; and

(2)  the registrant and the person are solidarily liable for all obligations that arise upon or as a consequence of the tax becoming collectible or any failure to account for or remit the tax.

1995, c. 63, s. 314; 1997, c. 85, s. 439.

41.1. Where a person (in this section referred to as the “mandator”) makes a supply, other than an exempt or zero-rated supply, of corporeal movable property to a recipient, otherwise than by auction, in the case where the mandator is not required to collect tax in respect of the supply except as provided in this section and a registrant (in this section referred to as the “mandatary”), in the course of a commercial activity of the mandatary, acts as mandatary in making the supply on behalf of the mandator, the following rules apply:

(1)  where the mandator is a registrant and the property was last used, or acquired for consumption or use, by the mandator in an endeavour of the mandator, within the meaning of section 42.0.1, and the mandator and the mandatary jointly elect in writing, the supply of the property to the recipient is deemed to be a taxable supply for the following purposes:

(a)  all purposes of this Title, other than determining whether the mandator may claim an input tax refund in respect of property or services acquired or brought into Québec by the mandator for consumption or use in making the supply to the recipient, and

(b)  the purpose of determining whether the mandator may claim an input tax refund in respect of a service supplied by the mandatary relating to the supply of the property to the recipient; and

(2)  in any other case, the supply of the property to the recipient is deemed to be a taxable supply made by the mandatary and not by the mandator, and the mandatary is deemed, except for the purposes of section 327.7, not to have made a supply to the mandator of a service relating to the supply of the property to the recipient.

1994, c. 22, s. 388; 1995, c. 1, s. 259; 1995, c. 63, s. 315; 1997, c. 85, s. 439.

41.2. Where a registrant (in this section referred to as the “auctioneer”), acting as auctioneer and mandatary for another person (in this section referred to as the “mandator”) in the course of a commercial activity of the auctioneer, makes, on behalf of the mandator, a supply by auction of movable corporeal property to a recipient, the supply is deemed to be a taxable supply made by the auctioneer and not by the mandator, and the auctioneer is deemed, except for the purposes of section 327.7, not to have made a supply to the mandator of a service relating to the supply of the property to the recipient.

1994, c. 22, s. 388; 1995, c. 63, s. 316; 1997, c. 85, s. 439.

41.2.1. Where a registrant (in this section referred to as the “auctioneer”), on a particular day, makes a particular supply by auction of prescribed property on behalf of another registrant (in this section referred to as the “mandator”) and, but for section 41.2, that supply would be a taxable supply made by the mandator, section 41.2 does not apply to the particular supply or to any supply made by the auctioneer to the mandator of a service relating to the particular supply where

(1)  the auctioneer and the mandator jointly elect in prescribed form containing prescribed information in respect of the particular supply; and

(2)  all or substantially all of the consideration for supplies made by auction on the particular day by the auctioneer on behalf of the mandator is attributable to supplies of prescribed property in respect of which the auctioneer and the mandator have elected under this section.

1997, c. 85, s. 440.

41.3. (Repealed).

1994, c. 22, s. 388; 1995, c. 63, s. 317; 1997, c. 85, s. 441.

41.4. (Repealed).

1994, c. 22, s. 388; 1995, c. 1, s. 260; 1995, c. 63, s. 318; 1997, c. 85, s. 441.

41.5. (Repealed).

1994, c. 22, s. 388; 1995, c. 63, s. 319; 1997, c. 85, s. 441.

41.6. Except for sections 294 to 297, 462 and 462.1, where a prescribed registrant, acting in the course of a commercial activity, makes a supply on behalf of another person of incorporeal movable property in respect of a product of an author, performing artist, painter, sculptor or other artist, the following rules apply:

(1)  the other person is deemed not to have made the supply to the recipient;

(2)  the registrant is deemed to have made the supply to the recipient; and

(3)  the registrant is deemed not to have made a supply to the other person of a service in relation to the supply to the recipient.

1994, c. 22, s. 388; 1997, c. 85, s. 442.

§ 2 . — Commercial activity

42. (Repealed).

1991, c. 67, s. 42; 1994, c. 22, s. 389.

42.0.1. For the purposes of sections 42.0.2 to 42.0.9, “endeavour” of a person means

(1)  a business of the person;

(2)  an adventure or concern of the person in the nature of trade; or

(3)  the making of a supply by the person of an immovable of the person, including anything done by the person in the course of or in connection with the making of the supply.

1995, c. 1, s. 261; 1997, c. 85, s. 443.

42.0.1.1. For the purposes of sections 42.0.1.2 to 42.0.5, “consideration” does not include nominal consideration.

1997, c. 85, s. 444.

42.0.1.2. For the purposes of sections 42.0.1 to 42.0.9, where an amount is not consideration for a supply and is a grant, subsidy, forgivable loan or other assistance in the form of money and the assistance may reasonably be considered to be provided for the purpose of funding an activity of the registrant that involves the making of taxable supplies for no consideration, the amount is deemed to be consideration for those supplies where it is received by the registrant from a person who is

(1)  a government, a municipality or a band within the meaning of section 2 of the Indian Act (Revised Statutes of Canada, 1985, chapter I-5);

(2)  a corporation that is controlled by a person referred to in paragraph 1 and one of the main purposes of which is to provide such assistance; or

(3)  a trust, board, commission or other body that is established by a person referred to in paragraph 1 or 2 and one of the main purposes of which is to provide such assistance.

1997, c. 85, s. 444.

42.0.2. Where a person acquires or brings into Québec property or a service for consumption or use in the course of an endeavour of the person, the person is deemed to have acquired or brought into Québec the property or service for consumption or use in the course of commercial activities of the person, to the extent that the property or service is acquired or brought into Québec by the person for the purpose of making taxable supplies for consideration in the course of that endeavour.

1995, c. 1, s. 261; 1995, c. 63, s. 320; 1997, c. 85, s. 445.

42.0.3. Where a person acquires or brings into Québec property or a service for consumption or use in the course of an endeavour of the person, the person is deemed to have acquired or brought into Québec the property or service for consumption or use otherwise than in the course of commercial activities of the person, to the extent that the property or service is acquired or brought into Québec by the person

(1)  for the purpose of making supplies in the course of that endeavour that are not taxable supplies made for consideration; or

(2)  for a purpose other than the making of supplies in the course of that endeavour.

1995, c. 1, s. 261; 1995, c. 63, s. 321; 1997, c. 85, s. 446.

42.0.4. Where a person consumes or uses property or a service in the course of an endeavour of the person, that consumption or use is deemed to be in the course of commercial activities of the person, to the extent that the consumption or use is for the purpose of making taxable supplies for consideration in the course of that endeavour.

1995, c. 1, s. 261; 1995, c. 63, s. 322; 1997, c. 85, s. 447.

42.0.5. Where a person consumes or uses property or a service in the course of an endeavour of the person, that consumption or use is deemed to be otherwise than in the course of commercial activities of the person, to the extent that the consumption or use is

(1)  for the purpose of making supplies in the course of that endeavour that are not taxable supplies made for consideration; or

(2)  for a purpose other than the making of supplies in the course of that endeavour.

1995, c. 1, s. 261; 1995, c. 63, s. 323; 1997, c. 85, s. 448.

42.0.6. Where a supplier makes a taxable supply (in this section referred to as a “free supply”) of property or a service for no consideration or nominal consideration in the course of a particular endeavour of the supplier and it can reasonably be regarded that among the purposes (in this section referred to as the “specified purposes”) for which the free supply is made is the purpose of facilitating, furthering or promoting the acquisition, consumption or use of other property or services by any other person, or an endeavour of any person, the following rules apply:

(1)  for the purposes of sections 42.0.2 and 42.0.3, the supplier is deemed to have acquired or brought into Québec a particular property or service for use in the course of the particular endeavour, and for the specified purposes and not for the purpose of making the free supply, to the extent that the supplier acquired or brought into Québec the particular property or service for the purpose of making the free supply of that property or service or for consumption or use in the course of making the free supply; and

(2)  for the purposes of sections 42.0.4 and 42.0.5, the supplier is deemed to have consumed or used a particular property or service for the specified purposes and not for the purpose of making the free supply, to the extent that he consumed or used the particular property or service for the purpose of making the free supply.

1995, c. 1, s. 261; 1995, c. 63, s. 324.

42.0.7. The methods used by a person in a fiscal year to determine the extent to which properties or services are acquired or brought into Québec by the person for the purpose of making taxable supplies for consideration or for other purposes and the extent to which the consumption or use of properties or services is for the purpose of making taxable supplies for consideration or for other purposes shall be fair and reasonable and shall be used consistently by the person throughout the year.

For the purposes of this section, the fiscal year of a person is the person’s fiscal year within the meaning of section 458.1.

1995, c. 1, s. 261; 1995, c. 63, s. 325; 1997, c. 85, s. 449.

42.0.8. Where under a particular provision of this Title, other than sections 42.0.2 to 42.0.6, certain facts or circumstances are deemed to exist, and that deeming is dependent, in whole or in part, on the particular circumstance that property or a service is or was acquired or brought into Québec for consumption or use, or consumed or used, to a certain extent in the course of, or otherwise than in the course of, commercial activities or other activities, the following rules apply:

(1)  for the purpose of determining whether the particular circumstance exists, that certain extent shall be determined under sections 42.0.2 to 42.0.5; and

(2)  where it is determined that the particular circumstance exists and all other circumstances necessary for the particular provision to apply exist, the deeming by the particular provision applies notwithstanding sections 42.0.2 to 42.0.5.

1995, c. 1, s. 261.

42.0.9. Where under a provision of this Title, the consideration for a supply is deemed not to be consideration for the supply, a supply is deemed to be made for no consideration or a supply is deemed not to have been made by a person, that deeming does not apply for the purposes of sections 42.0.1 to 42.0.6.

1995, c. 1, s. 261.

42.1. A person is deemed to have made a supply of movable property in the course of a commercial activity where the person makes a supply, other than an exempt supply, of movable property that

(1)  was last acquired or brought into Québec by the person for consumption or use in the course of the person’s commercial activities;

(2)  was consumed or used by the person in the course of a commercial activity of the person after it was last acquired or brought into Québec by the person;

(3)  was manufactured or produced by the person in the course of a commercial activity of the person or for consumption or use in the course of a commercial activity of the person, and was not deemed to have been acquired by the person; or

(4)  was manufactured or produced by the person and consumed or used in the course of a commercial activity of the person, and was not deemed to have been acquired by the person.

1994, c. 22, s. 390.

42.2. A person is deemed to have made a supply of movable property otherwise than in the course of commercial activities where the person makes a supply, other than a supply made by way of lease, licence or similar arrangement in the course of a business of the person, of movable property that

(1)  was last acquired or brought into Québec by the person exclusively for consumption or use in the course of activities of the person that are not commercial activities and was not consumed or used by the person in the course of commercial activities of the person after it was last acquired or brought into Québec by the person; or

(2)  was manufactured or produced by the person in the course of activities of the person that are not commercial activities exclusively for consumption or use in the course of activities of the person that are not commercial activities, was not consumed or used in the course of a commercial activity of the person and was not deemed to have been acquired by the person.

1994, c. 22, s. 390.

42.3. A person is deemed to have made a supply of movable property or a service in the course of commercial activities of the person where the person makes a supply by way of sale of movable property or a service that was acquired, brought into Québec, manufactured or produced by the person exclusively for the purpose of making a supply of that property or service by way of sale in the course of a business of the person or in the course of an adventure or concern of the person in the nature of trade, except where

(1)  the supply is an exempt supply;

(2)  section 42.4 applies in respect of the supply; or

(3)  the person is an individual or a partnership, all of the members of which are individuals, who carries on the business or engages in the adventure or concern without a reasonable expectation of profit.

1994, c. 22, s. 390.

42.4. Where a person makes a supply by way of sale of movable property or a service that was acquired, brought into Québec, manufactured or produced by the person exclusively for the purpose of making an exempt supply of the property or service by way of sale, the person is deemed to have made the supply otherwise than in the course of commercial activities.

1994, c. 22, s. 390.

42.5. To the extent that a person does anything, other than make a supply, in connection with the acquisition, establishment, disposition or termination of a commercial activity of the person, the person is deemed to have done that thing in the course of commercial activities of the person.

1994, c. 22, s. 390.

42.6. To the extent that a person does anything, other than make a supply, in connection with the acquisition, establishment, disposition or termination of an activity of the person that is not a commercial activity, the person is deemed to have done that thing otherwise than in the course of commercial activities.

1994, c. 22, s. 390.

42.7. For the purposes of Division I of Chapter VIII and for the purpose of determining an input tax refund, a supply of a financial service by a person is deemed to be made otherwise than in the course of commercial activities of the person, except to the extent that the supply is made in the course of a business carried on by that person.

1995, c. 63, s. 326.

43. Where substantially all of the consumption or use of property or a service by a person is in the course of the person’s commercial activities, all of the consumption or use of the property or service by the person is deemed to be in the course of those activities.

1991, c. 67, s. 43; 1994, c. 22, s. 391.

44. Where substantially all of the consumption or use for which a person acquired or brought into Québec property or a service is in the course of the person’s commercial activities, all of the consumption or use for which the person acquired or brought the property or service is deemed to be in the course of those activities.

1991, c. 67, s. 44; 1994, c. 22, s. 391.

45. Where substantially all of the consumption or use of property or a service by a person is in the course of particular activities of the person that are not commercial activities, all of the consumption or use is deemed to be in the course of those particular activities.

1991, c. 67, s. 45; 1994, c. 22, s. 391.

46. Where substantially all of the consumption or use for which a person acquired or brought into Québec property or a service is in the course of particular activities of the person that are not commercial activities, all of the consumption or use for which the person acquired or brought the property or service is deemed to be in the course of those particular activities.

1991, c. 67, s. 46; 1994, c. 22, s. 391.

47. For the purposes of sections 43 to 46, where an immovable includes a residential complex and another part that is not part of the residential complex,

(1)  the residential complex is deemed to be a property separate from the other part; and

(2)  where property or a service is acquired or brought into Québec for consumption or use in relation to the immovable, sections 43 to 46 apply to the property or service only to the extent that it is acquired or brought into Québec for consumption or use in relation to the part that is not part of the residential complex.

1991, c. 67, s. 47; 1994, c. 22, s. 391; 1997, c. 85, s. 450.

48. The following supplies, when made for consideration by a government or municipality or a board, commission or other body established by a government or municipality are, for greater certainty, deemed to be made in the course of a commercial activity, except where the supply is an exempt supply:

(1)  a supply of a service of testing or inspecting any property for the purpose of verifying or certifying that the property meets particular standards of quality or is suitable for consumption, use or supply in a particular manner;

(2)  a supply to a consumer of a right to hunt or fish;

(3)  a supply of a right to take or remove forestry products, products that grow in water, fishery products, minerals or peat, where the supply is made to

(a)  a consumer, or

(b)  a person who is not a registrant and who acquires the right in the course of a business of the person of making supplies of the products, minerals or peat to consumers;

(4)  a supply of a licence, permit, quota or similar right in respect of the bringing into Québec of alcoholic beverages; and

(5)  a supply of a right to enter, to have access to or to use property of the government, municipality or other body.

1991, c. 67, s. 48; 1994, c. 22, s. 392.

48.1. The following supplies, when made by a sponsor of a foreign convention, are deemed to have been made otherwise than in the course of a commercial activity of the sponsor:

(1)  a supply of an admission to the convention;

(2)  a supply by way of lease, licence or similar arrangement of an immovable for use by the recipient of the supply exclusively as the site for the promotion, at the convention, of a business of, or of property or services supplied by, the recipient; and

(3)  a supply of related convention supplies to the recipient of the supply referred to in paragraph 2.

1994, c. 22, s. 393.

49. (Repealed).

1991, c. 67, s. 49; 1994, c. 22, s. 394; 1995, c. 1, s. 262.

50. (Repealed).

1991, c. 67, s. 50; 1997, c. 85, s. 451.

DIVISION III CONSIDERATION

51. The value of the consideration, or any part thereof, for a supply is deemed to be equal,

(1)  where the consideration or that part is expressed in money, to the amount of the money; and

(2)  where the consideration or that part is expressed otherwise than in money, to the fair market value of the consideration or that part at the time the supply was made.

1991, c. 67, s. 51.

51.1. (Repealed).

1994, c. 22, s. 395; 1995, c. 63, s. 327; 1997, c. 85, s. 452.

52. For the purposes of this section, “provincial levy” means a duty, fee or tax imposed under an Act of the legislature of Québec, another province, the Northwest Territories or the Yukon Territory in respect of the supply, consumption or use of property or a service.

The consideration for a supply of property or a service includes

(1)  any duty, fee or tax imposed under an Act of Canada that is payable by the recipient, or payable or collectible by the supplier, in respect of that supply or in respect of the production, importation into Canada, consumption or use of the property or service;

(2)  any provincial levy that is payable by the recipient, or payable or collectible by the supplier, in respect of that supply or in respect of the consumption or use of the property or service, other than tax payable under this Title and the prescribed duties, fees or taxes payable by the recipient;

(3)  any other amount that is collectible by the supplier under an Act of the legislature of Québec, another province, the Northwest Territories or the Yukon Territory that is equal to, or is collectible on account of or in lieu of, a provincial levy, except where the amount is payable by the recipient and the provincial levy is a prescribed duty, fee or tax.

If, under Title I, a person is deemed to be the recipient of a supply in respect of which another person would, but for that deeming, be the recipient, a reference in this section to the recipient of the supply shall be read as a reference to that other person.

1991, c. 67, s. 52; 2001, c. 53, s. 283.

52.1. (Repealed).

1993, c. 19, s. 176; 1995, c. 63, s. 328; 1997, c. 85, s. 453.

53. The second paragraph shall apply where

(1)  consideration is paid for a supply and other consideration is paid for one or more other supplies or matters; and

(2)  the consideration for one of the supplies or matters exceeds the consideration that would be reasonable if the other supply were not made or the other matter were not provided.

The consideration for each of the supplies and matters is deemed to be that part of the total of all amounts, each of which is consideration for one of those supplies or matters, that may reasonably be attributed to each of those supplies and matters.

1991, c. 67, s. 53.

54. The value of the consideration or a part of the consideration for a supply of property of a particular class or kind is deemed to be nil where

(1)  the consideration or that part of the consideration for the supply of the property is property of that class or kind; and

(2)  both the supplier and the recipient are registrants; and

(3)  the property is acquired by the recipient and the consideration or that part thereof is acquired by the supplier as inventory for use exclusively in commercial activities of the recipient or supplier, as the case may be.

1991, c. 67, s. 54.

54.1. Where, at the time a supplier makes a supply of corporeal movable property to a recipient, the supplier accepts, in full or partial consideration for the supply, other property (in this section and in section 54.2 referred to as the “trade-in”) that is used corporeal movable property or a leasehold interest therein and is acquired for consumption, use or supply in the course of a commercial activity of the supplier, and the recipient is not required to collect the tax in respect of the supply of the trade-in otherwise than by reason of the application of subparagraph 3 of the second paragraph of section 422 or the trade-in is a road vehicle in respect of which the recipient is not entitled to claim an input tax refund as a consequence of being a large business, the value of the consideration for the supply made by the supplier is deemed to be equal to the amount by which the value of the consideration for that supply, as otherwise determined, exceeds

(1)  except where paragraph 2 applies, the amount credited to the recipient in respect of the trade-in; and

(2)  where the supplier and the recipient are not dealing with each other at arm’s length at the time the supply is made and the amount credited to the recipient in respect of the trade-in exceeds the fair market value of the trade-in at the time ownership thereof is transferred to the supplier, that fair market value.

For the purposes of this section and section 54.2, “large business” has the meaning assigned by sections 551 to 551.4 of the Act to amend the Taxation Act, the Act respecting the Québec sales tax and other legislative provisions (1995, chapter 63).

1997, c. 85, s. 454; 2002, c. 9, s. 155.

54.1.1. If a person (in this section and sections 54.1.2 to 54.1.5 referred to as the “lessee”) makes a supply by way of sale of corporeal movable property to another person (in this section referred to as the “lessor”), the lessee is not required to collect tax in respect of that supply and the lessor immediately makes a taxable supply of the property by way of lease to the lessee under an agreement (in this section and sections 54.1.2 to 54.1.5 referred to as the “original leaseback agreement”), the value of the consideration for a supply of the property by way of lease that, at a particular time, becomes due or is paid without having become due under a particular agreement that is the original leaseback agreement or a subsequent lease in respect of that agreement, is deemed to be equal to the amount determined by the formula

A − B.

For the purposes of this formula,

(1)  A is the value of the consideration as otherwise determined; and

(2)  B is the amount (in this section referred to as the “purchase credit”) that is equal to the lesser of

(a)  the value of A, and

(b)  the amount determined by the formula

C / D, or

(c)  if there is no unused total purchase credit within the meaning of subparagraph 1 of the third paragraph, zero.

For the purposes of the formula in subparagraph b of subparagraph 2 of the second paragraph,

(1)  C is the amount (in this section and section 54.1.5 referred to as the “unused total purchase credit”) by which the consideration for the supply by way of sale exceeds the total of all amounts each of which is the purchase credit that was determined in calculating the amount deemed under this section to be the value of any consideration that, before the particular time, became due or was paid without having become due under the original leaseback agreement or a subsequent lease in respect of that agreement; and

(2)  D is the specified number of remaining lease payments under the particular agreement at the particular time.

2001, c. 53, s. 284.

54.1.2. For the purposes of section 54.1.1, “specified number of remaining lease payments”, at a particular time, in respect of a particular agreement for the supply of property by way of lease that is an original leaseback agreement or a subsequent lease in respect of that agreement, is the amount determined by the formula

A − B.

For the purposes of this formula,

(1)  A is the total number of payments that the lessee was obligated to make as consideration for the supplies of the property by way of lease under the particular agreement based on the terms of that agreement at the time it was entered into; and

(2)  B is the total number of payments referred to in subparagraph 1 that, before the particular time, became due or were paid by the lessee.

2001, c. 53, s. 284.

54.1.3. For the purposes of sections 54.1.1 to 54.1.5, “subsequent lease”, in respect of an original leaseback agreement for the supply of property by way of lease to a lessee, means

(1)  an agreement for the supply of the property by way of lease that constitutes a new agreement between the lessee and an assignee of the rights and obligations of the person who is the supplier under the original leaseback agreement or under an agreement referred to in this paragraph or paragraph 2; or

(2)  an agreement for the supply of the property by way of lease to the lessee that succeeds, as a new agreement, either the original leaseback agreement or a particular agreement referred to in paragraph 1 or in this paragraph upon a renewal or variation of that original leaseback agreement or particular agreement.

2001, c. 53, s. 284.

54.1.4. For the purposes of sections 54.1.1, 54.1.2 and 54.1.5, where a supplier agrees, at any time, to renew, vary, terminate, otherwise than upon the exercise of an option to purchase, or assign a particular agreement for the supply of property by way of lease that is an original leaseback agreement or a subsequent lease in respect of that agreement and the renewal, variation, termination or assignment does not constitute a novation of the particular agreement but has the effect of changing the number of payments that the lessee is obligated to make for supplies by way of lease of the property under the particular agreement, the following rules apply:

(1)  the supplier and lessee are deemed to have, at that time, entered into a subsequent lease in respect of the original leaseback agreement; and

(2)  all supplies by way of lease for which consideration becomes due, or is paid without having become due, at or after the time the renewal, variation, termination or assignment takes effect that would, but for this section, be made under the particular agreement are deemed to be made under that subsequent lease and not under the particular agreement.

2001, c. 53, s. 284.

54.1.5. Except for a purpose contemplated in paragraph 1 of section 54.2, if a supply of property by way of sale is made to a lessee on the exercise by the lessee of an option to purchase the property provided for in an original leaseback agreement entered into by the lessee in respect of the property, or in a subsequent lease in respect of that agreement, to which section 54.1.1 applied, and immediately before the earliest time at which the consideration for the supply becomes due or is paid without having become due, there is an unused total purchase credit in respect of the property, the following rules apply:

(1)  the value of the consideration for the supply is deemed to be equal to the amount determined by the formula

A − B; and

(2)  section 54.1.1 does not apply to any consideration that, after that earliest time, becomes due or is paid without having become due for any supply of the property by way of lease that was made under the original leaseback agreement or under a subsequent lease in respect of that agreement.

For the purposes of this formula,

(1)  A is the value of the consideration for the supply as otherwise determined; and

(2)   B is that unused total purchase credit.

2001, c. 53, s. 284.

54.1.6. For the purposes of sections 54.1.1 to 54.1.5, if a person makes a supply of property by way of sale to a recipient with whom the person is not dealing at arm’s length and the consideration for the supply exceeds the fair market value of the property at the time ownership of the property is transferred to the recipient, the consideration for the supply is deemed to be equal to that fair market value.

2001, c. 53, s. 284.

54.2. Section 54.1 does not apply

(1)  for the purpose of determining, for the purposes of any provision of this Title, whether the value of consideration for a supply of property equals, exceeds or is less than another amount specified in another provision;

(2)  for the purposes of sections 294, 295, 297, 462 and 462.1; or

(3)  to any supply of a trade-in that is a zero-rated supply, other than a zero-rated supply under section 197.2 made by a large business that is not entitled to claim an input tax refund in respect of the trade-in as a consequence of being a large business, a supply made outside Québec or a supply in respect of which no tax is payable because of paragraph 1 of section 75.1 or section 334;

(4)  (paragraph repealed).

1997, c. 85, s. 454; 2001, c. 51, s. 263; 2002, c. 9, s. 156.

54.3. If natural gas is transported by pipeline to a straddle plant at which natural gas liquids or ethane (each of which is referred to in this section as “natural gas liquids”) is recovered from the natural gas, the residue gas is returned to the pipeline after the recovery along with other natural gas (in this section referred to as “make-up gas”) that is supplied solely to make up for the loss of energy content due to the recovery, and the consideration or a part of the consideration for any supply of the natural gas liquids, or the right to recover the liquids, or any supply of make-up gas is, in the case of a supply of natural gas liquids or the right to recover the liquids, the make-up gas, and, in the case of a supply of make-up gas, the natural gas liquids or the right to recover the liquids, the value of that consideration or part, as the case may be, is deemed to be nil.

2001, c. 53, s. 285.

55. Where a supply of property or a service is made between persons not dealing with each other at arm’s length for no consideration or for consideration less than the fair market value of the property or service at the time the supply is made, and the recipient of the supply is not a registrant who is acquiring the property or service for consumption, use or supply exclusively in the course of commercial activities of the recipient,

(1)  if no consideration is paid for the supply, the supply is deemed to be made for consideration, paid at that time, of a value equal to the fair market value of the property or service at that time; and

(2)  if consideration is paid for the supply, the value of the consideration is deemed to be equal to the fair market value of the property or service at that time.

This section does not apply in respect of

(1)  a supply of property or a service made by a person where

(a)  an amount is deemed under section 290 to be the total consideration for the supply, or

(b)  in the absence of the first paragraph,

i.  the person, because of section 203 or 206, would not be entitled to claim an input tax refund in respect of the acquisition or bringing into Québec of the property or service by the person,

ii.  section 286 would apply to the supply, or

iii.  the supply would be an exempt supply referred to in Division V.1 or VI of Chapter III; or

(2)  a supply by way of sale, other than by way of gift, of a used road vehicle made between related individuals.

1991, c. 67, s. 55; 1993, c. 19, s. 177; 1994, c. 22, s. 396; 1995, c. 63, s. 329; 1997, c. 85, s. 455; 2002, c. 9, s. 157.

55.0.1. Where a taxable supply by way of sale of a used road vehicle that must be registered under the Highway Safety Code (chapter C-24.2) following an application by the recipient of the vehicle is made for no consideration or for consideration less than the estimated value of the vehicle, the following rules apply:

(1)  if no consideration is paid for the supply, the supply is deemed to be made for consideration, paid at that time, of a value equal to the estimated value of the vehicle; and

(2)  if the consideration for the supply is less than the estimated value of the vehicle, the value of the consideration is deemed to be equal to that estimated value.

This section does not apply in respect of

(1)  a supply of a road vehicle made following the exercise by the recipient of a right to acquire the vehicle, conferred on the recipient under an agreement in writing for the lease of the vehicle entered into by the recipient and the supplier;

(2)  a supply of a road vehicle deemed to be made or received for no consideration or for consideration equal to the fair market value of the vehicle;

(3)  a supply of a road vehicle in respect of which tax is deemed to be collected or paid; or

(4)  a supply of a road vehicle made between individuals related to each other otherwise than by way of gift.

1995, c. 1, s. 263; 2002, c. 9, s. 158.

55.0.2. For the purposes of section 55.0.1, the estimated value of a road vehicle is

(1)  in the case of a vehicle for which the average wholesale price is listed in the most recent edition, on the first day of the month in which the vehicle is supplied, of the Guide d’Évaluation Hebdo (Automobiles et Camions Légers) published by Hebdo Mag Inc., that price less an amount of $500;

(1.1)  (paragraph repealed);

(2)  in the case of a vehicle for which an average wholesale price is listed in the most recent edition, on the first day of the month preceding the month in which the vehicle is supplied, of the Canadian Motorcycle Dealers Blue Book published by All Seasons Publications Ltd., that price less an amount of $500;

(3)  in the case of a vehicle for which an average wholesale price is listed in the most recent edition, on the first day of the month preceding the month in which the vehicle is supplied, of the Canadian ATV, Snowmobile & Watercraft Dealers Blue Book published by All Seasons Publications Ltd., that price less an amount of $500; and

(4)  in any other case, the value of the vehicle prescribed by the Minister.

1995, c. 1, s. 263; 1995, c. 63, s. 330; 1997, c. 14, s. 333; 2000, c. 39, s. 281.

55.0.3. Where section 55.0.1 applies in respect of the supply of a road vehicle that is damaged or that shows unusual wear and at the time of the supply the recipient provides the supplier of the vehicle or, in the case of a supply under section 20.1 or a supply of a motor vehicle by way of retail sale, the Minister or a person prescribed for the purposes of section 473.1 or, as the case may be, section 473.1.1, with a written estimate of the vehicle or of the repairs to be carried out in respect of the vehicle, the estimated value of the vehicle described in section 55.0.2 may be reduced by an amount equal to

(1)  the amount by which that value exceeds the value of the vehicle stated in the written estimate; or

(2)  the amount by which the value stated in the written estimate of the repairs to be carried out in respect of the vehicle exceeds $500.

The written estimate shall be made by a person who has been issued an attestation of professional qualification as an estimator of automobile damage by the Groupement des assureurs automobiles.

1995, c. 1, s. 263; 1995, c. 63, s. 331; 2001, c. 51, s. 264.

55.1. The Minister may determine the value of the consideration for the taxable supply of property or a service on which the tax must be calculated if either

(1)  the supply is not a supply in respect of which section 55 or 55.0.1 applies, or would apply, but for the second paragraph of those sections, and if

(a)  the supply is made for no consideration, or

(b)  the value of the consideration for the supply of the property or service is less than the fair market value of the property or service; or

(2)  the consideration for the supply of the property or service

(a)  is not shown on the invoice or on any other document recording the supply, or

(b)  is combined with the consideration for any other supply that is not a taxable supply other than a zero-rated supply.

1993, c. 19, s. 178; 2002, c. 9, s. 159.

56. Where the consideration for a supply is expressed in a foreign currency, the value of the consideration shall be computed on the basis of the value of that foreign currency in Canadian currency on the day the tax is payable, or on such other day as is acceptable to the Minister.

1991, c. 67, s. 56.

57. Where corporeal movable property or services are supplied and the amount of consideration for the supply shown in the invoice in respect of the supply may be reduced if the amount thereof is paid within a time specified in the invoice or an additional amount is charged to the recipient by the supplier if the amount of the consideration is not paid within a reasonable period specified in the invoice, the consideration due is deemed to be the amount of consideration shown in the invoice.

1991, c. 67, s. 57.

58. (Repealed).

1991, c. 67, s. 58; 1994, c. 22, s. 397; 1997, c. 85, s. 456.

58.1. (Repealed).

1994, c. 22, s. 398; 1997, c. 85, s. 456.

58.2. (Repealed).

1994, c. 22, s. 398; 1997, c. 85, s. 456.

58.3. Where an individual, because of membership in a trade union or association referred to in paragraph 1 of section 172, participates in activities of the union or association and, as a consequence, is unable to perform duties, under a contract of employment, for the individual’s employer during a period during which the individual would, were it not for the individual’s participation in those activities, be obligated to provide such services, and the union or association pays an amount to the employer as compensation for expenses incurred by the employer as a consequence of the individual’s participation in those activities or for remuneration or benefits given by the employer to the individual in respect of that period, the amount is deemed not to be consideration for a supply.

1994, c. 22, s. 398.

59. (Repealed).

1991, c. 67, s. 59; 1994, c. 22, s. 399.

60. Where a particular person bets an amount on a game of chance, a race or other event, the following rules apply:

(1)  the person with whom the bet is placed is deemed to have made a supply of a service to the particular person;

(2)  where the bet is placed in Québec, that supply is deemed to have been made in Québec; and

(3)  the consideration for that supply is deemed to be equal to the amount determined by multiplying the total amount in respect of the bet that is given by the particular person to the person with whom the bet is placed, including any amount given as or on account of tax imposed on the particular person under this Title, by 100/107.5.

1991, c. 67, s. 60; 1997, c. 85, s. 457.

61. (Repealed).

1991, c. 67, s. 61; 1995, c. 63, s. 332; 1997, c. 85, s. 458.

62. Where a competitor in a competitive event contributes an amount to the prizes to be given to competitors in the event, the contribution is deemed not to be consideration for a supply.

This section does not apply in respect of a contribution, made as part of the fee or charge paid by the competitor in a competitive event for the right or privilege of participating in the event, that is not separately identified as a contribution to the prizes.

1991, c. 67, s. 62.

62.1. An amount that is paid as or on account of demurrage, or by one railway corporation to another railway corporation as or on account of a penalty for failure to return rolling stock within a stipulated time, is deemed not to be consideration for a supply.

1994, c. 22, s. 400.

63. For the purposes of this section and sections 64 to 67,

“base fraction”, at a particular time, of a tour package means the proportion that the part of the amount that would be charged by the first supplier of the package for a supply at that time of the package that is, at that time, reasonably attributable to the taxable portion of the package is of the amount that would be charged by the first supplier of the package for a supply at that time of the package;

“first supplier” of a tour package means the person who first supplies the package in Québec;

“initial taxable percentage” of a tour package means the proportion, at the time the first supplier of the package determines the amount to be charged by that supplier for a supply of the package, that the part of that amount that is, at that time, reasonably attributable to the taxable portion of the package is of that amount;

“taxable percentage”, at a particular time, of a tour package means

(1)  where the difference between the base fraction at that time of the package and the initial taxable percentage of the package or the base fraction of the package at an earlier time is more than 10%, the base fraction of the package at the particular time, and

(2)  in any other case, the initial taxable percentage of the package;

“taxable portion” of a tour package means all property and services included in the tour package and in respect of which tax under section 16 would be payable if the property or service were supplied otherwise than as part of a tour package;

“tour package” means a combination of two or more services, or of property and services, that includes transportation services, accommodation, a right to use a campground or trailer park, or guide or interpreter services, where the property and services are supplied together for an all-inclusive price.

1991, c. 67, s. 63; 1995, c. 63, s. 333.

64. The consideration for a supply of the taxable portion of a tour package, where the supply is made by the first supplier of the package, is deemed to be the amount determined by the formula

A × B.

For the purposes of this formula,

(1)  A is the taxable percentage of the package at the time the supply is made; and

(2)  B is the total consideration for the entire tour package.

1991, c. 67, s. 64.

65. The consideration for a supply of the taxable portion of a tour package, where the supply is made by any person other than the first supplier of the package, is deemed to be the amount determined by the formula

A × B.

For the purposes of this formula,

(1)  A is the percentage that the consideration for the supply to the person of the taxable portion of the package is of the total consideration paid or payable by the person for the entire tour package; and

(2)  B is the total consideration paid or payable to the person for the entire tour package.

1991, c. 67, s. 65.

66. The provision of the part of the tour package that is the taxable portion of the package is deemed to be a separate supply from the provision of the remaining part of the package and neither supply is deemed to be incidental to the other.

1991, c. 67, s. 66.

67. (Repealed).

1991, c. 67, s. 67; 1995, c. 63, s. 334.

DIVISION IV SPECIFIC RULES RESPECTING TAXATION

§ 1 . — Rules respecting calculation

68. Where a person makes a taxable supply and the consideration, or a part thereof, for the supply becomes due, or is paid before it becomes due, at a time when the person is a small supplier who is not a registrant, that consideration or part thereof, as the case may be, shall not be included in calculating the tax payable in respect of the supply.

This section does not apply in respect of

(1)  a supply of an immovable by way of sale; or

(2)  a supply of a road vehicle that must be registered under the Highway Safety Code (chapter C-24.2) following an application by the recipient of the supply.

1991, c. 67, s. 68; 1995, c. 63, s. 335.

69. Where tax that is at any time payable under section 16 in respect of one or more supplies included in an agreement, invoice or receipt is an amount that includes a fraction of a cent, the fraction,

(1)  if less than half of a cent, may be disregarded; and

(2)  if equal to or greater than half of a cent, is deemed to be an amount equal to one cent.

1991, c. 67, s. 69; 1997, c. 85, s. 459.

69.1. Where the consideration for a supply of a telecommunication service is paid by depositing coins in a coin-operated telephone and the tax payable is equal to a fraction of $0.05 or to the total of a multiple of $0.05 and a fraction of $0.05, the fraction

(1)  if less than $0.025, may be disregarded; and

(2)  if equal to or greater than $0.025, is deemed to be an amount equal to $0.05.

1994, c. 22, s. 401; 1997, c. 85, s. 460.

69.2. (Repealed).

1994, c. 22, s. 401; 1995, c. 63, s. 336.

69.3. Where a registrant ordinarily uses a cash register to determine the tax payable by a recipient in respect of a taxable supply made by the registrant and the cash register does not have the capability of determining the tax by multiplying the value of the consideration for the supply by the rate of the tax or the value of the consideration determined without reference to the tax payable by the recipient under Part IX of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15) (in this section referred to as the “value of the adjusted consideration”), by 8.025%, or 15.025% if the registrant determines a total amount made up of both the tax under this Title and the tax under Part IX of the Excise Tax Act, the following rules apply:

(1)  the registrant may, by means of the cash register, determine the tax payable by multiplying the value of the adjusted consideration by 8.02%; and

(2)  the registrant may, by means of the cash register, determine the total amount made up of both that tax and the tax under Part IX of the Excise Tax Act by multiplying the value of the adjusted consideration by 15.02%.

1995, c. 1, s. 264; 1997, c. 85, s. 461.

69.4. Every registrant who applies the rules set out in section 69.3 in circumstances different from those referred to in the said section shall incur a penalty of 1% of the tax collected throughout the period of irregularity.

1995, c. 1, s. 264.

69.5. Where the consideration for a supply of corporeal movable property or a service is paid by depositing a single coin in a mechanical coin-operated device that is designed to accept only a single coin of $0.25 or less as the total consideration for the supply and the corporeal movable property is dispensed from the device or the service is rendered through the operation of the device, the tax payable in respect of the supply is equal to zero.

1997, c. 85, s. 462.

69.6. Where two or more taxable supplies are included in an invoice, agreement or receipt, the tax payable under section 16 in respect of those supplies, calculated on the consideration for those supplies that is indicated in the invoice, agreement or receipt, may be calculated on the total of that consideration.

1997, c. 85, s. 462.

70. (Repealed).

1991, c. 67, s. 70; 1994, c. 22, s. 402.

71. Where a supply is made, and the consideration therefor is paid, by means of a coin-operated device, the following rules apply:

(1)  the recipient is deemed to have received the supply, paid the consideration for the supply, and paid any tax payable in respect of the supply, on the day the consideration for the supply is inserted into the device;

(2)  the supplier is deemed to have made the supply, received the consideration for the supply, and collected any tax payable in respect of the supply, on the day the consideration for the supply is removed from the device.

1991, c. 67, s. 71.

72. (Repealed).

1991, c. 67, s. 72; 1994, c. 22, s. 403.

73. (Repealed).

1991, c. 67, s. 73; 1993, c. 19, s. 179; 1994, c. 22, s. 403.

74. (Repealed).

1991, c. 67, s. 74; 1994, c. 22, s. 403.

§ 2 . — Supplies not subject to taxation

75. Where a supplier makes a supply of a business or part of a business that was established or carried on by the supplier or that was established or carried on by another person and acquired by the supplier, and, under the agreement for the supply, the recipient is acquiring ownership, possession or use of all or substantially all of the property that can reasonably be regarded as being necessary for the recipient to be capable of carrying on the business or part as a business,

(1)  the supplier is deemed to have made a separate supply of each property and service that is supplied under the agreement for consideration equal to that part of the consideration for the supply of the business or part that can reasonably be attributed to that property or service; and

(2)  except where the supplier is a registrant and the recipient is not a registrant, the supplier and the recipient may make a joint election in prescribed form containing prescribed information to have section 75.1 apply to those supplies.

1991, c. 67, s. 75; 1993, c. 19, s. 180; 1994, c. 22, s. 404.

75.1. Where a supplier and a recipient make an election under section 75 and the recipient, if a registrant, files the election with the Minister not later than the day on or before which the return under Chapter VIII is required to be filed for the recipient’s first reporting period in which tax would, but for this section, have become payable in respect of the supply of any property or service made under the agreement for the supply of the business or part of the business to which the election applies, or on such later day as the Minister may determine on application of the recipient,

(1)  no tax is payable in respect of a supply of any property or service made under the agreement other than

(a)  a taxable supply of a service that is to be rendered by the supplier,

(b)  a taxable supply of property by way of lease, licence or similar arrangement,

(c)  where the recipient is not a registrant, a taxable supply by way of sale of an immovable, and

(d)  (subparagraph repealed);

(2)  where, but for this section, tax would have been payable by the recipient, otherwise than by reason of section 20.1, in respect of a supply made under the agreement of property that was capital property of the supplier and that is being acquired by the recipient for use as capital property of the recipient, the recipient is deemed to have so acquired the property for use exclusively in the course of commercial activities of the recipient; and

(3)  where, notwithstanding this section, tax would not have been payable by the recipient or would have been payable by the recipient under section 20.1 in respect of a supply made under the agreement of property that was capital property of the supplier and that is being acquired by the recipient for use as capital property of the recipient, the recipient is deemed to have so acquired the property for use exclusively in activities of the recipient that are not commercial activities.

1994, c. 22, s. 405; 1995, c. 63, s. 337.

75.2. Where a supplier makes a supply of a business or part of a business that was established or carried on by the supplier or that was established or carried on by another person and acquired by the supplier, the recipient is acquiring ownership, possession or use of all or substantially all of the property that can reasonably be regarded as being necessary for the recipient to be capable of carrying on the business or part as a business, and part of the consideration for the supply can reasonably be attributed to goodwill of the business or part, that part of the consideration shall not be included in calculating the tax payable in respect of the supply.

1994, c. 22, s. 405.

76. Where two or more corporations are merged or amalgamated to form a new corporation, otherwise than as the result of the acquisition of the property of one corporation by another corporation pursuant to the purchase of the property by the other corporation, or as the result of the distribution of the property to the other corporation on the winding-up of the corporation,

(1)  except as otherwise provided in this Title, the new corporation is deemed to be a separate person from each of the merged or amalgamated corporations;

(2)  for the purposes of sections 444, 446 and 462 to 462.1.1, for the purpose of applying the provisions of this Title in respect of property or a service acquired or brought into Québec by a merged or amalgamated corporation, and for prescribed purposes and provisions, the new corporation is deemed to be the same corporation as, and a continuation of, each merged or amalgamated corporation; and

(3)  the transfer of any property by a merged or amalgamated corporation to the new corporation as a consequence of the merger or amalgamation is deemed not to be a supply.

1991, c. 67, s. 76; 1994, c. 22, s. 406; 1995, c. 63, s. 338; 2001, c. 53, s. 286.

77. Where at any time a particular corporation is wound up and not less than 90% of the issued shares of each class of the capital stock of the particular corporation were, immediately before that time, owned by another corporation,

(1)  for the purposes of sections 444, 446 and 462 to 462.1.1, for the purpose of applying the provisions of this Title in respect of property or a service acquired or brought into Québec by the other corporation as a consequence of the winding-up, and for prescribed purposes and provisions, the other corporation is deemed to be the same corporation as, and a continuation of, the particular corporation; and

(2)  the transfer of any property to the other corporation as a consequence of the winding-up is deemed not to be a supply.

1991, c. 67, s. 77; 1994, c. 22, s. 407; 1995, c. 63, s. 339; 2001, c. 53, s. 287.

78. (Repealed).

1991, c. 67, s. 78; 1997, c. 3, s. 118; 1997, c. 85, s. 463.

79. (Repealed).

1991, c. 67, s. 79; 1997, c. 3, s. 119; 1997, c. 85, s. 463.

79.1. No tax is payable in respect of the supply of a road vehicle of a deceased individual, which road vehicle must be registered under the Highway Safety Code (chapter C-24.2) following an application by the recipient of the vehicle, if the supply is made by the succession of the individual in accordance with the individual’s will or the laws relating to the transmission of property on death or in settlement of rights arising out of the individual’s marriage.

1993, c. 19, s. 181; 1997, c. 85, s. 464.

80. No tax is payable in respect of the supply of property of a deceased individual made by the succession of the individual where

(1)  immediately before death, the individual held the property for consumption, use or supply in the course of a business carried on immediately before the individual’s death;

(2)  the succession of the individual makes a supply of the property, in accordance with the individual’s will or the laws relating to the transmission of property on death, to another individual who is a beneficiary of the individual’s succession and a registrant;

(3)  the property is received for consumption, use or supply in the course of commercial activities of the other individual; and

(4)  the succession and the other individual make a joint election for the purposes of this section.

The other individual is deemed to have acquired the property for use exclusively in commercial activities of the individual.

1991, c. 67, s. 80; 1994, c. 22, s. 408; 1997, c. 85, s. 465.

80.1. No tax is payable in respect of the supply by way of gift of a road vehicle that must be registered under the Highway Safety Code (chapter C-24.2) following an application by the recipient of the vehicle, where the supply is made between related individuals.

Similarly, no tax is payable in respect of the supply of such a road vehicle where the supply is made between individuals in settlement of rights arising out of their marriage.

1993, c. 19, s. 182; 1995, c. 1, s. 265; 1997, c. 85, s. 466.

80.1.1. No tax is payable in respect of the supply of a road vehicle made by a municipality to another municipality where

(1)  the vehicle is supplied under an agreement in writing for the provision of municipal services by the recipient in the territory of the supplier; and

(2)  the vehicle is supplied for use by the recipient in providing municipal services of the same nature as those in the course of which the vehicle was used by the supplier before the time the vehicle was supplied;

(3)  (paragraph repealed).

1995, c. 1, s. 266; 1995, c. 63, s. 340.

80.1.2. No tax is payable in respect of a supply by way of sale of a used road vehicle made between two corporations, other than business corporations, in connection with a transfer under a law of rights and obligations.

2002, c. 9, s. 160.

80.2. (Repealed).

1993, c. 19, s. 182; 1995, c. 63, s. 341.

80.3. Where a sponsor of a convention makes a taxable supply by way of lease, licence or similar arrangement to a person not resident in Québec of an immovable that is acquired by the person exclusively for use as a site for the promotion, at the convention, of a business of, or of property or services supplied by, the person, no tax is payable in respect of that supply to the person or in respect of any supply by the sponsor to the person of property or services that are acquired by the person for consumption or use as related convention supplies in respect of the convention.

1994, c. 22, s. 409.

§ 3 . — Goods not subject to taxation brought into Québec

81. The goods referred to in subparagraph 2 of the fourth paragraph of section 17 are the following:

(1)  goods that are classified under heading No. 98.01, 98.02, 98.03, 98.04, 98.05, 98.06, 98.07, 98.10, 98.11, 98.12, 98.15, 98.16 or 98.19 or under subheading No. 9823.60, 9823.70, 9823.80 or 9823.90 of Schedule I to the Customs Tariff (Revised Statutes of Canada, 1985, chapter 41, 3rd Supplement), to the extent that the goods are not subject to duty under that Act, but not including goods that are classified under tariff item No. 9804.30.00 of that schedule;

(2)  goods from Canada outside Québec that would be goods classified, with the necessary modifications, under any of the headings or subheadings mentioned in paragraph 1 if they were from outside Canada, but not including goods that would be classified under tariff item No. 9804.10.00, 9804.20.00, 9804.30.00, 9804.40.00, 9805.00.00 or 9807.00.00 of Schedule I to the Customs Tariff;

(2.1)  goods from Canada outside Québec that are for the domestic or personal use of an individual arriving in Québec to take up permanent residence, except goods acquired by the individual less than 31 days before his arrival in Québec and in respect of which the individual has not paid tax of the same nature as the tax payable under this Title, imposed by another province, the Northwest Territories or the Yukon Territory, or in respect of which the individual has obtained or is entitled to obtain a rebate of such a tax;

(3)  medals, trophies and other prizes, not including usual merchantable goods, that are won outside Québec in competitions, that are bestowed, received or accepted outside Québec or that are donated by persons outside Québec, for heroic deeds, valour or distinction;

(4)  printed matter that is to be made available to the general public, without charge, for the promotion of tourism, where the printed matter is brought into Québec

(a)  by or on the order of a government outside Québec or by an agency or representative of such a government, or

(b)  by a board of trade, chamber of commerce, municipal or automobile association or similar organization to which it was supplied for no consideration, other than shipping and handling charges;

(5)  goods that are brought into Québec by a charity or a public institution and that have been donated to the charity or institution;

(6)  goods that are brought into Québec by a particular person if the goods are supplied to the particular person by a person not resident in Québec for no consideration, other than shipping and handling charges, as replacement parts or as replacement property under a warranty;

(7)  goods to the supply of which any of Divisions I, II, III or IV of Chapter IV, paragraph 2 of section 198 or section 198.1 or 198.2 applies;

(7.1)  a motor vehicle acquired by way of a supply made outside Québec in circumstances in which the vehicle, had it been acquired by way of a supply made in Québec in the same circumstances, would have been acquired by way of a zero-rated supply under section 197.2;

(8)  goods, other than prescribed goods, that are sent to the recipient of the supply of the goods at an address in Québec by mail or courier, that are from outside Canada and the value of which is not more than $20;

(8.1)  goods that are prescribed property for the purposes of section 24.1 and that are sent, by mail or courier, to the recipient of the supply of the goods at an address in Québec, where the supplier is registered under Division I of Chapter VIII at the time the goods are brought into Québec;

(9)  prescribed goods brought into Québec in prescribed circumstances, under prescribed terms and conditions;

(10)  containers that, because of regulations made under paragraph c of Note 11 to Chapter 98 of Schedule I to the Customs Tariff, may be imported into Canada free of customs duties, or could be so imported but for the fact that the goods are from Canada outside Québec;

(11)  money, certificates or other documents evidencing a right that is a financial instrument;

(12)  goods from Canada outside Québec that are supplied to a person by lease, licence or similar arrangement under which continuous possession or use of the goods is provided for a period of more than three months in circumstances in which tax under subsection 1 of section 165 of the Excise Tax Act is payable by the person in respect of the supply; and

(13)  a mobile home or floating home that has been used or occupied in Québec as a place of residence for individuals.

1991, c. 67, s. 81; 1993, c. 19, s. 183; 1994, c. 22, s. 410; 1995, c. 1, s. 267; 1995, c. 63, s. 342; 1997, c. 85, s. 467; 2001, c. 51, s. 265; 2001, c. 53, s. 288.

DIVISION V SPECIFIC RULES RESPECTING TIME OF TAXATION

82. Tax under section 16 in respect of a taxable supply is payable by the recipient on the earlier of the day the consideration for the supply is paid and the day the consideration for the supply becomes due.

1991, c. 67, s. 82.

82.1. Notwithstanding section 82, tax under section 16 in respect of a supply referred to in section 20.1 is payable at the time the supply is made.

1993, c. 19, s. 184.

82.2. Notwithstanding section 82, tax under section 16 in respect of the supply of a motor vehicle by way of retail sale, other than a supply under section 20.1, is payable at the time of the registration of the vehicle under the Highway Safety Code (chapter C-24.2) following an application by the recipient of the supply.

Notwithstanding the first paragraph, tax is payable at the time the motor vehicle is delivered to the recipient if the vehicle is not registered within 15 days after that time.

2001, c. 51, s. 266.

83. The consideration, or a part thereof, for a taxable supply is deemed to become due on the earliest of

(1)  the earlier of the day the supplier first issues an invoice in respect of the supply for that consideration or part and the date of that invoice,

(2)  the day the supplier would, but for an undue delay, have issued an invoice in respect of the supply for that consideration or part, and

(3)  the day the recipient is required to pay that consideration or part to the supplier pursuant to an agreement in writing.

Notwithstanding the first paragraph, where property is supplied by way of lease, licence or similar arrangement under an agreement in writing, the consideration, or any part thereof, for the supply is deemed to become due on the day the recipient is required to pay the consideration or part to the supplier pursuant to the agreement.

1991, c. 67, s. 83.

84. Where consideration that is not money is given or required to be given, the consideration that is given or required to be given is deemed to be paid or required to be paid, as the case may be.

1991, c. 67, s. 84.

85. Notwithstanding section 82, where consideration for a taxable supply is paid or becomes due on more than one day, tax under section 16 in respect of the supply is payable on each day that is the earlier of the day a part of the consideration is paid and the day that part becomes due.

The tax that is payable on each such day shall be calculated on the value of the part of the consideration that is paid or becomes due, as the case may be, on that day.

1991, c. 67, s. 85.

86. Notwithstanding sections 82 and 85, where all or any part of the consideration for a taxable supply has not been paid or become due on or before the last day of the calendar month immediately following the first calendar month in which,

(1)  where the supply is of corporeal movable property by way of sale, other than a supply described in paragraph 2 or 3, the ownership or possession of the property is transferred to the recipient,

(2)  where the supply is of corporeal movable property by way of sale under which the supplier delivers the property to the recipient on approval, consignment, or other similar terms, the recipient acquires ownership of the property or makes a supply of it to any person, other than the supplier, or

(3)  where the supply is under an agreement in writing for the construction, renovation or alteration of, or repair to any immovable or any ship or other marine vessel, and it may reasonably be expected that the construction, renovation, alteration or repair will require more than three months to complete, the construction, renovation, alteration or repair is substantially completed,

tax under section 16 in respect of the supply, calculated on the value of that consideration or part, as the case may be, is payable on that day.

1991, c. 67, s. 86; 1995, c. 63, s. 343.

87. Section 86 does not apply in respect of a supply of water, electricity, natural gas, steam or any other property where the property is delivered to the recipient on a continuous basis by means of a wire, pipeline or other conduit and the supplier invoices the recipient in respect of that supply on a regular or periodic basis.

1991, c. 67, s. 87.

88. Tax under section 16 in respect of a taxable supply of immovable property by way of sale is payable on the earlier of the day ownership of the property is transferred to the recipient and the day possession of the property is transferred to the recipient under the agreement for the supply.

Notwithstanding the first paragraph, in the case of a supply of a residential unit held in co-ownership, where possession of the unit is transferred, after 30 June 1992 and before the declaration of co-ownership relating to the complex in which the unit is situated is entered in the land register, to the recipient under the agreement for the supply, the tax is payable on the earlier of the day ownership of the unit is transferred to the recipient and the day that is 60 days after the day the declaration of co-ownership is entered in the land register.

This section applies notwithstanding sections 82 and 85.

1991, c. 67, s. 88; 1997, c. 3, s. 135.

89. Where under section 86 or 88 tax is payable on a particular day and the value of the consideration, or any part thereof, for the taxable supply is not ascertainable on that day,

(1)  tax calculated on the value of the consideration or part, as the case may be, that is ascertainable on that day is payable on that day; and

(2)  tax calculated on the value of the consideration or part, as the case may be, that is not ascertainable on that day is payable on the day the value becomes ascertainable.

1991, c. 67, s. 89.

90. Notwithstanding sections 82, 85, 86, 88 and 89, where the recipient of a taxable supply retains, pursuant to an Act of the Legislature of Québec, another province, the Northwest Territories, the Yukon Territory or of the Parliament of Canada, or pursuant to an agreement in writing for the construction, renovation or alteration of, or repair to, any immovable or any ship or other marine vessel, a part of the consideration for the supply pending full and satisfactory performance of the supply, or any part thereof, tax under section 16 calculated on the value of that part of the consideration, is payable on the earlier of the day that part is paid and the day it becomes payable.

1991, c. 67, s. 90.

91. For the purposes of sections 82, 82.2, 85 to 90 and 92, where a supply of any combination of service, movable property or immovable property (each of which is in this section referred to as an “element”) is made and the consideration for each element is not separately identified,

(1)  where the value of a particular element can reasonably be regarded as exceeding the value of each of the other elements, the supply of all of the elements is deemed to be a supply only of the particular element; and

(2)  in any other case, the supply of all of the elements is deemed, where one of the elements is immovable property, to be a supply only of immovable property, and in any other case, to be a supply only of a service.

1991, c. 67, s. 91; 2001, c. 51, s. 267.

92. For the purposes of sections 82, 82.2 and 85 to 91, a deposit, whether refundable or not, given in respect of a supply shall not be considered as consideration paid for the supply unless and until the supplier applies the deposit as consideration for the supply.

This section does not apply in respect of a deposit relating to a covering or container to which section 33 applies.

1991, c. 67, s. 92; 2001, c. 51, s. 268.

CHAPTER III EXEMPT SUPPLY

DIVISION I IMMOVABLE

93. (Repealed).

1991, c. 67, s. 93; 1997, c. 85, s. 468.

94. A supply by way of sale of a residential complex or an interest therein made by a person who is not a builder of the complex or, where the complex is a multiple unit residential complex, an addition thereto is exempt, unless the person claimed an input tax refund in respect of the last acquisition by the person of the complex, or in respect of the acquisition or bringing into Québec by the person, after the complex was last acquired by the person, of an improvement to the complex.

1991, c. 67, s. 94; 1994, c. 22, s. 411.

95. A supply by way of sale of a residential complex or an interest therein made by an individual who is a builder of the complex or, where the complex is a multiple unit residential complex, an addition thereto is exempt, if

(1)  at any time after the construction or substantial renovation of the complex or addition is substantially completed, the complex is used primarily as a place of residence of the individual, an individual related to the individual or a former spouse of the individual; and

(2)  the complex is not used primarily for any other purpose after the construction or substantial renovation is substantially completed and before that time.

The first paragraph does not apply if the individual claimed an input tax refund in respect of the last acquisition by the individual of the immovable included in the residential complex or in respect of the acquisition or bringing into Québec by the individual, after the immovable was last acquired by the individual, of an improvement to the immovable.

1991, c. 67, s. 95; 1994, c. 22, s. 411.

96. A supply by way of sale of a single unit residential complex (in this section referred to as the “complex”) or a residential unit held in co-ownership (in this section referred to as the “unit”) or an interest in the complex or unit made by a builder of the complex or unit is exempt where,

(1)  in the case of a unit situated in a residential complex (in this section referred to as the “premises”) that was converted by the builder from use as a multiple unit residential complex to use as a complex held in co-ownership, the builder received an exempt supply of the premises by way of sale or was deemed under section 225 to have received a taxable supply of the premises by way of sale, and that supply was the last supply of the premises made by way of sale to the builder; or

(2)  in any case, the builder received an exempt supply of the complex or unit by way of sale or was deemed under section 223 or 224 to have received a taxable supply of the complex or unit by way of sale, and that supply was the last supply of the complex or unit made by way of sale to the builder.

The first paragraph does not apply if,

(1)  after the complex, unit or premises were last acquired by the builder, the builder carried on, or engaged another person to carry on for the builder, the substantial renovation of the complex, unit or premises; or

(2)  the builder claimed an input tax refund in respect of the last acquisition by the builder of the complex, unit or premises or in respect of the acquisition or bringing into Québec by the builder, after the complex, unit or premises were last acquired by the builder, of an improvement to the complex, unit or premises.

1991, c. 67, s. 96; 1994, c. 22, s. 411.

97. A supply by way of sale of a multiple unit residential complex or an interest therein made by a person who is a builder of the complex or an addition thereto is exempt where

(1)  in the case of a person who is a builder of the complex, the person received an exempt supply of the complex by way of sale, or was deemed under section 225 to have received a taxable supply of the complex by way of sale, and that supply was the last supply of the complex made by way of sale to the person; and

(2)  in the case of a person who is a builder of an addition to the complex, the person received an exempt supply of the addition by way of sale, or was deemed under section 226 to have received a taxable supply of the addition by way of sale, and that supply was the last supply of the addition made by way of sale to the person.

The first paragraph does not apply if,

(1)  after the complex was last supplied to the person, the person carried on, or engaged another person to carry on for the person, the substantial renovation of the complex; or

(2)  the person claimed an input tax refund in respect of the last acquisition by the person of the complex or an addition thereto or in respect of the acquisition or bringing into Québec by the person, after the complex was last acquired by the person, of an improvement to the complex, other than an input tax refund in respect of the construction of an addition to the complex.

1991, c. 67, s. 97; 1994, c. 22, s. 411.

97.1. A supply by way of sale of a building, or that part of a building, in which one or more residential units are located, or an interest in such a building or part, is exempt where

(1)  both immediately before and immediately after the earlier of the time ownership of the building, part or interest is transferred to the recipient of the supply (in this section referred to as the “purchaser”) and the time possession thereof is transferred to the purchaser under the agreement for the supply, the building or part forms part of a residential complex; and

(2)  immediately after the earlier of the time ownership of the building, part or interest is transferred to the purchaser and the time possession thereof is transferred to the purchaser under the agreement for the supply, the purchaser is a recipient described in subparagraph a of subparagraph 1 of the first paragraph of section 100 of an exempt supply, described by subparagraph 1 of the first paragraph of that section, of the land included in the complex.

1994, c. 22, s. 412.

97.2. A supply by way of sale of land that forms part of a residential complex or an interest in such land is exempt where

(1)  immediately before the earlier of the time ownership thereof is transferred to the recipient of the supply and the time possession thereof is transferred to the recipient of the supply under the agreement for the supply, the land is subject to a lease, licence or similar arrangement by which a supply that is an exempt supply described by subparagraph 1 of the first paragraph of section 100 was made; and

(2)  if a supply by way of sale were made of the residential complex immediately before that earlier time, the supply would be an exempt supply described in any of sections 94 to 97.

1994, c. 22, s. 412.

97.3. A supply of a residential trailer park or an interest therein made by a person is exempt where

(1)  the person received an exempt supply, described by this section, of the park or was deemed under section 222.2, 243, 258 or 261 to have received a taxable supply of the land included in the park as a consequence of using the land for purposes of the park, and that supply was the last supply of the park made by way of sale to the person; and

(2)  if the person increased the area of land included in the park (in this section referred to as the “additional area”), the person received an exempt supply, described by this section, of the additional area or was deemed under section 222.3, 243, 258 or 261 to have made a taxable supply of the additional area as a consequence of using the additional area for purposes of the park, and that supply was the last supply of the additional area made by way of sale to the person.

The first paragraph does not apply if the person claimed an input tax refund in respect of the last acquisition by the person of the park or an additional area thereof or in respect of the acquisition or bringing into Québec by the person, after the park was last acquired by the person, of an improvement to the park, other than an input tax refund in respect of an improvement to an additional area that was acquired or brought into Québec by the person before the additional area was last acquired by the person.

1994, c. 22, s. 412.

98. A supply is exempt where the supply is

(1)  of a residential complex or a residential unit in a residential complex by way of lease, licence or similar arrangement for the purpose of its occupation as a place of residence or lodging by an individual, where the period throughout which continuous occupation of the complex or unit is given to the same individual under the arrangement is at least one month; or

(2)  of a residential unit by way of lease, licence or similar arrangement for the purpose of its occupation as a place of residence or lodging by an individual, where the consideration for the supply does not exceed $20 for each day of occupation.

1991, c. 67, s. 98; 1994, c. 22, s. 413; 1997, c. 85, s. 469.

99. A supply of property is exempt where the property is land, a building, or that part of a building, that forms part of a residential complex or that consists solely of residential units, or a residential complex, and the supply is made by way of lease, licence or similar arrangement for a lease interval, within the meaning assigned by section 32.2, throughout which the lessee or any sub-lessee makes, or holds the property for the purpose of making, one or more supplies of the property, parts of the property or leases, licences or similar arrangements in respect of the property or parts thereof and all or substantially all of those supplies are

(1)  exempt supplies described by section 98 or 100; or

(2)  supplies that are made, or are reasonably expected to be made, to other lessees or sub-lessees described in this section.

1991, c. 67, s. 99; 1994, c. 22, s. 413; 1997, c. 85, s. 470; 2001, c. 53, s. 289.

99.1. A supply of meals made by a person who is making a supply, described by paragraph 1 of section 98, of a residential complex or unit is exempt where the meals are provided, to the occupant of the complex or unit, in the complex or unit or in the residential complex in which the unit is located under an arrangement whereby at least 10 meals per week are supplied for a single consideration determined before any meal is provided under the arrangement.

1994, c. 22, s. 414.

100. A supply is exempt where the supply is

(1)  of land, other than a site in a residential trailer park, by way of lease, licence or similar arrangement under which continuous possession or occupation of the land is provided for a period of at least one month, made to

(a)  the owner, lessee or person in occupation or possession of a residential unit that is or is to be affixed to the land for the purpose of its use and enjoyment as a place of residence for individuals, or

(b)  a person who is acquiring possession of the land for the purpose of constructing a residential complex on it in the course of a commercial activity;

(2)  of a site in a residential trailer park, by way of lease, licence or similar arrangement under which continuous possession or occupation of the site is provided for a period of at least one month, made to the owner, lessee or person in occupation or possession of

(a)  a mobile home situated or to be situated on the site, or

(b)  a travel trailer, motor home or similar vehicle or trailer situated or to be situated on the site; or

(3)  of a lease, licence or similar arrangement referred to in subparagraph 1 or 2 by way of assignment.

The first paragraph does not apply to a supply of land on which the residential unit, mobile home, travel trailer, motor home or similar vehicle or trailer is or is to be affixed or situated, or any land contiguous to it, that is not reasonably necessary for the use and enjoyment of the unit, home, vehicle or trailer as a place of residence for individuals.

1991, c. 67, s. 100; 1994, c. 22, s. 415; 1997, c. 85, s. 471.

101. A supply by way of sale of a parking space that is the subject of a declaration of co-ownership entered in the land register made by a supplier to a person is exempt if

(1)  the supplier, at the same time or as part of the same supply, makes a supply, included in any of sections 94 to 96, by way of sale to the person of a residential unit held in co-ownership described by that declaration; and

(2)  the space was, at any time, supplied to the supplier by way of sale and the supplier did not, after that time, claim an input tax refund in respect of an improvement to the space.

1991, c. 67, s. 101; 1994, c. 22, s. 415; 1997, c. 85, s. 472; 2001, c. 53, s. 290.

101.1. A supply of a parking space by way of lease, licence or similar arrangement under which any such space is made available throughout a period of at least one month, is exempt where the supply is

(1)  made to a person (in this paragraph referred to as an “occupier”) who is a lessee or person in occupation or possession of a single unit residential complex, a residential unit in a multiple unit residential complex or a site in a residential trailer park where

(a)  the space forms part of the residential complex or residential trailer park, as the case may be, or

(b)  the supplier of the space is an owner or occupier of the single unit residential complex, residential unit or site, as the case may be, and the use of the space is incidental to the use and enjoyment of the complex, unit or site, as the case may be, as a place of residence for individuals;

(2)  made to the owner, lessee or person in occupation or possession of a residential unit held in co-ownership described by a declaration of co-ownership entered in the land register if the space is the subject of that declaration; or

(3)  made by a supplier to the owner, lessee or person in occupation or possession of a floating home where the home is moored to mooring facilities or a wharf under an agreement with the supplier for a supply that is an exempt supply described in section 106.2 and the use of the space is incidental to the use and enjoyment of the home as a place of residence for individuals.

1994, c. 22, s. 416; 1997, c. 85, s. 473; 2001, c. 53, s. 291.

101.1.1. For the purposes of section 102, “settlor”, in relation to a testamentary trust constituted by reason of the death of an individual, means that individual.

1997, c. 85, s. 474.

102. A supply of an immovable by way of sale made by an individual or a personal trust is exempt, except where the supply is

(1)  a supply of an immovable that is, immediately before the time ownership or possession of the immovable is transferred to the recipient of the supply under the agreement for the supply, capital property used primarily in a business of the individual or trust with a reasonable expectation of profit;

(2)  a supply of an immovable made

(a)  in the course of a business of the individual or trust, or

(b)  in the course of an adventure or concern in the nature of trade of the individual or trust, where the individual or trust has filed an election with and as prescribed by the Minister for that purpose in prescribed form containing prescribed information;

(2.1)  a supply of a part of a parcel of land, which parcel the individual, trust or settlor of a testamentary trust subdivided or severed into parts, except where

(a)  the parcel was subdivided or severed into two parts and the individual, trust or settlor of a testamentary trust did not subdivide or sever that parcel from another parcel of land, or

(b)  the recipient of the supply is an individual who is related to, or is a former spouse of, the individual or settlor of a testamentary trust and is acquiring the part for the personal use and enjoyment of the recipient;

(3)  a supply deemed under any of sections 256 to 262 to have been made; or

(4)  a supply of a residential complex.

For the purposes of subparagraph 2.1 of the first paragraph, a part of a parcel of land that the individual, trust or settlor of a testamentary trust supplies to a person who has the right to acquire it by expropriation, and the remainder of that parcel, are deemed not to have been subdivided or severed from each other by the individual, trust or settlor of a testamentary trust, as the case may be.

1991, c. 67, s. 102; 1994, c. 22, s. 417; 1997, c. 85, s. 475.

103. A supply of farmland by way of sale made by an individual to another individual who is related to or who is a former spouse of the individual, is exempt where

(1)  the farmland was used at any time by the individual in a commercial activity that is the business of farming;

(2)  the farmland was not used, immediately before the time ownership of the property is transferred under the supply, by the individual in a commercial activity other than the business of farming; and

(3)  the other individual is acquiring the farmland for the personal use and enjoyment of the other individual or any individual related thereto.

1991, c. 67, s. 103.

104. A supply by an individual of farmland, deemed under section 221 or 261 to have been made, is exempt where

(1)  the farmland was used at any time by the individual in a commercial activity that is the business of farming;

(2)  the farmland was not used, immediately before the supply is deemed to have been made, by the individual in a commercial activity other than the business of farming; and

(3)  the farmland, immediately after the time the supply is deemed to have been made, is for the personal use and enjoyment of the individual or of an individual related to him.

1991, c. 67, s. 104.

105. A supply of farmland by way of sale made by a person that is a partnership, trust or corporation to a particular individual, an individual related to or a former spouse of the particular individual, is exempt where

(1)  immediately before the time ownership of the property is transferred under the supply,

(a)  all or substantially all of the property of the person is used in a commercial activity that is the business of farming;

(b)  the particular individual is a member of the partnership, a beneficiary of the trust or a shareholder of or related to the corporation, as the case may be; and

(c)  the particular individual, the spouse of the particular individual or a child, within the meaning of paragraph d of section 451 of the Taxation Act (chapter I-3), of the particular individual is actively engaged in the business of the person; and

(2)  immediately after the time ownership of the property is transferred under the supply, the farmland is for the personal use and enjoyment of the individual to whom the supply was made or of an individual related thereto.

1991, c. 67, s. 105.

106. A supply of property or a service, made by a corporation or syndicate established upon the registration in the land register of a declaration of co-ownership, to the owner or lessee of a residential unit held in co-ownership described by that declaration, is exempt if the property or service relates to the occupancy or use of the unit.

1991, c. 67, s. 106; 2001, c. 53, s. 292.

106.1. A supply of property or a service made by a cooperative housing corporation to a person who, because the person is a shareholder of the corporation or a lessee or sub-lessee of a shareholder of the corporation, is entitled to occupy or use a residential unit in a residential complex administered or owned by the corporation, where the supply relates to the occupation or use of a residential unit in the complex, is exempt.

1994, c. 22, s. 418.

106.2. A supply, made to a person who is the owner, lessee or person in occupation or possession of a floating home, of a right to use mooring facilities or a wharf for a period of at least one month in connection with the use and enjoyment of the home as a place of residence for individuals, is exempt.

1994, c. 22, s. 418.

106.3. A supply to a consumer of the right to use a washing machine or clothes-dryer that is located in a common area of a residential complex is exempt.

1997, c. 85, s. 476.

106.4. A supply by way of lease, licence or similar arrangement of that part of the common area of a residential complex that is used as a laundry, made to a person who so acquires the property for use in the course of making supplies described in section 106.3, is exempt.

1997, c. 85, s. 476.

107. For the purposes of sections 96, 97, 97.2 and 97.3, sections 222.2, 222.3 and 223 to 231.1 are deemed to have been in force at all times.

1991, c. 67, s. 107; 1994, c. 22, s. 419.

DIVISION II HEALTH CARE SERVICE

108. In this division,

“health care institution” means

(1)  a centre operated by an institution, within the meaning of the Act respecting health services and social services (chapter S-4.2) or within the meaning of the Act respecting health services and social services for Cree Native persons (chapter S-5), for the purpose of providing health or hospital care, acute or chronic care or rehabilitative care, or any other institution operated for the purpose of providing such care;

(1.1)  a centre referred to in paragraph 1 that is primarily for the mentally deficient, or any other institution primarily for the mentally deficient;

(2)  a facility, or part thereof, operated for the purpose of providing residents of the facility who have limited physical or mental capacity for self-supervision and self-care with

(a)  nursing and personal care under the direction or supervision of qualified medical and nursing care staff or other personal and supervisory care, other than domestic services of an ordinary household nature, according to the individual requirements of the residents,

(b)  assistance with the activities of daily living and social, recreational and other related services to meet the psycho-social needs of the residents, and

(c)  meals and accommodation;

“homemaker service” means a household or personal service, such as cleaning, laundering, meal preparation and child care, that is rendered to an individual who, due to age, infirmity or disability, requires assistance;

“institutional health care service” means any of the following when provided in a health care institution:

(1)  a laboratory, radiological or other diagnostic service;

(2)  a medication, biological substance or related preparation when administered, or a medical or surgical prosthesis when installed, in the facility in conjunction with the supply of a service or property included in any of paragraphs 1 and 3 to 7;

(3)  the use of an operating room, case room or anaesthetic facilities, including necessary equipment or supplies;

(4)  medical or surgical equipment or supplies

(a)  used by the operator of the institution in providing a service included in any of paragraphs 1 to 3 and 5 to 7, or

(b)  supplied to a patient or resident of the institution otherwise than by way of sale;

(5)  the use of occupational therapy, physiotherapy or radiotherapy facilities;

(6)  lodging;

(7)  a meal other than one served in a restaurant, cafeteria or similar place where meals are served;

(8)  a service rendered by a person remunerated for that purpose by the operator of the institution;

“medical practitioner” means a physician within the meaning of the Medical Act (chapter M-9) or a dentist within the meaning of the Dental Act (chapter D-3) and includes a person who is entitled under the laws of another province, the Northwest Territories or the Yukon Territory to practise the profession of medicine or dentistry;

“practitioner” means a person who practices the profession of audiology, chiropody, chiropractic, dietetics, occupational therapy, optometry, osteopathy, physiotherapy, podiatry or psychology in Québec and who

(1)  where the person is required to be licensed or otherwise authorized to practise that profession in Québec, is so licensed or otherwise authorized;

(2)  where the person is not required to be so licensed or otherwise authorized, has qualifications equivalent to those necessary to be licensed or otherwise authorized to practise in another province, the Northwest Territories or the Yukon Territory;

(3)  (paragraph repealed).

1991, c. 67, s. 108; 1992, c. 21, s. 373, s. 375; 1994, c. 22, s. 420; 1995, c. 1, s. 270; 1994, c. 23, s. 23; 1995, c. 63, s. 344; 1997, c. 85, s. 477; 2001, c. 53, s. 293.

109. A supply of an institutional health care service made by the operator of a health care institution, when rendered to a patient or resident, is exempt.

However, such a supply does not include the supply of an institutional health care service related to the provision of a surgical or dental service that is performed for cosmetic purposes and not for medical or reconstructive purposes.

1991, c. 67, s. 109; 1992, c. 21, s. 375; 2001, c. 53, s. 294.

110. A supply by way of lease of medical equipment or supplies, made by the operator of a health care institution to a consumer on the written order of a physician, is exempt.

1991, c. 67, s. 110; 1992, c. 21, s. 375.

111. A supply of an ambulance service made by a person who carries on the business of supplying ambulance services is exempt.

However, such a supply does not include a supply of an air ambulance service referred to in section 197.1.

1991, c. 67, s. 111; 1997, c. 85, s. 478.

112. A supply made by a physician of a consultative, diagnostic, or treatment service or another health care service rendered to an individual is exempt.

However, such a supply does not include the supply of a surgical or dental service that is performed for cosmetic purposes and not for medical or reconstructive purposes.

1991, c. 67, s. 112.

113. A supply of nursing services rendered by a nurse or a nursing assistant is exempt where

(1)  the service is rendered to an individual in a health care institution or in the individual’s place of residence;

(2)  the service is a private-duty nursing service; or

(3)  the supply is made to a public sector body.

1991, c. 67, s. 113; 1992, c. 21, s. 375; 1997, c. 85, s. 479.

114. A supply of an audiological, chiropodic, chiropractic, occupational therapy, optometric, osteopathic, physiotherapy, podiatric or psychological service, when rendered to an individual, is exempt where the supply is made by a practitioner.

1991, c. 67, s. 114; 1997, c. 85, s. 480; 2001, c. 53, s. 295.

114.1. A supply of a dietetic service made by a practitioner is exempt where

(1)  the service is rendered to an individual;

(2)  the supply is made to a public sector body; or

(3)  the supply is made to the operator of a health care institution.

1997, c. 85, s. 481.

115. A supply of a dental hygienist service is exempt.

1991, c. 67, s. 115.

116. A supply, other than a zero-rated supply, of any property or service is exempt to the extent that the consideration for the supply is payable or reimbursed by the Government of Québec pursuant to the Health Insurance Act (chapter A-29) or the Act respecting the Régie de l’assurance maladie du Québec (chapter R-5) or by the government of another province, the Northwest Territories or the Yukon Territory under a health care plan established for the insured persons of that province or territory under an Act of the legislature of that province or territory.

1991, c. 67, s. 116; 1995, c. 1, s. 271; 1999, c. 89, s. 53.

117. A supply of a prescribed diagnostic, treatment or other health care service, when made on the order of a physician or a practitioner, is exempt.

1991, c. 67, s. 117.

118. A supply of food and beverages, including the services of a caterer, made to an operator of a health care institution under a contract to provide on a regular basis meals for the patients or residents of the institution is exempt.

1991, c. 67, s. 118; 1992, c. 21, s. 375.

119. (Repealed).

1991, c. 67, s. 119; 1997, c. 85, s. 482.

119.1. A supply of a homemaker service that is rendered to an individual in the individual’s place of residence, whether the recipient of the supply is the individual or any other person, is exempt where

(1)  the supplier is a government;

(2)  the supplier is a municipality;

(3)  a government, municipality or organization administering a government or municipal program in respect of homemaker services pays an amount

(a)  to the supplier in respect of the supply, or

(b)  to any person for the purpose of the acquisition of the service; or

(4)  another supply of a homemaker service rendered to the individual is made in the circumstances described in paragraph 1, 2 or 3.

1994, c. 22, s. 421; 1995, c. 1, s. 272.

DIVISION III EDUCATIONAL SERVICE

120. In this division,

“elementary or secondary school student” means an individual who is enrolled for

(1)  educational services at the elementary level provided by a school authority;

(2)  educational services at the secondary level provided by a school authority or for services equivalent to such services;

“regulatory body” means a body constituted or empowered by an Act of the Legislature of Québec to regulate the practice of a profession or trade in Québec by setting standards of knowledge or proficiency for practitioners of a profession or trade;

“vocational school” means an institution established and operated primarily to provide students with correspondence courses, or instruction in courses, that develop or enhance students’ occupational skills.

1991, c. 67, s. 120; 1994, c. 22, s. 422; 1997, c. 85, s. 483.

121. A supply made by a school authority that consists in providing individuals with educational services primarily for elementary or secondary school students is exempt.

1991, c. 67, s. 121.

122. A supply of food, beverages, a service or an admission made by a school authority primarily to elementary or secondary school students during the course of an extra-curricular activity organized under the authority and responsibility of the school authority is exempt.

This section does not apply to food or beverages prescribed for the purposes of section 131 or food or beverages supplied through a vending machine.

1991, c. 67, s. 122; 1997, c. 85, s. 484.

123. A supply made by a school authority of a service performed by an elementary or secondary school student or by an instructor of an elementary or secondary school student in the course of the student’s program of studies is exempt.

1991, c. 67, s. 123.

124. A supply of a service of transporting elementary or secondary school students to or from a school of a school authority is exempt, if the supply is made by a school authority to a person who is not a school authority.

1991, c. 67, s. 124; 2002, c. 9, s. 161.

125. The following supplies, made by a professional association, public college, vocational school, government, regulatory body or university are exempt:

(1)  a supply that consists in providing an individual with an educational service leading to, or for the purpose of maintaining or upgrading, a professional accreditation or professional title recognized by the regulatory body;

(2)  a supply that consists in administering an examination or a supply of a certificate in respect of an educational service, a professional accreditation or a professional title referred to in subparagraph 1.

This section does not apply if the supplier has made an election under this section in prescribed form containing prescribed information.

1991, c. 67, s. 125; 1994, c. 22, s. 423.

126. A supply made by a school authority, public college or university that consists in providing an individual with, or administering an examination in respect of, an educational service for which credit may be obtained toward a diploma is exempt.

1991, c. 67, s. 126.

126.1. A supply of a service or membership the consideration for which is required to be paid by the recipient of a supply because the recipient receives the supply included in section 126 is exempt.

1994, c. 22, s. 424.

127. A supply, other than a zero-rated supply, made by a school authority, vocational school, public college or university that consists in providing an individual with, or administering an examination in respect of, an educational service leading to a certificate, diploma, permit or similar document, or a class or rating, in respect of a licence or permit, that attests to the competence of an individual to practise a trade or vocation is exempt where

(1)  the document, class or rating is prescribed by federal or provincial regulation;

(2)  the supplier is governed by federal or provincial legislation respecting vocational schools; or

(3)  the supplier is a public institution or a non-profit organization.

1991, c. 67, s. 127; 1994, c. 22, s. 425; 1997, c. 85, s. 485.

128. The following supplies to an individual are exempt:

(1)  a supply of an educational service that consists in instructing the individual in a course that either follows a program of studies at the elementary or secondary level established or approved by the Minister of Education or is approved for credit at the elementary or secondary level by the Minister;

(2)  a supply of an educational service that consists in instructing the individual in a course that is a prescribed equivalent of a course described in paragraph 1;

(3)  a supply of an educational service that consists in instructing the individual in a prerequisite course the successful completion of which is mandatory for admittance into a course described in paragraph 1 or 2.

1991, c. 67, s. 128; 1993, c. 51, s. 72; 1994, c. 16, s. 50; 1994, c. 22, s. 425; 1999, c. 83, s. 310.

129. (Repealed).

1991, c. 67, s. 129; 1993, c. 51, s. 72; 1994, c. 16, s. 50; 1994, c. 22, s. 426.

130. A supply of an educational service that consists in instructing individuals in, or administering examinations in respect of, language courses that form part of a program of second-language instruction in either English or French is exempt, where the supply is made by a school authority, vocational school, public college or university or in the course of a business established and operated primarily to provide instruction in languages.

1991, c. 67, s. 130; 2001, c. 53, s. 296.

131. A supply of food or beverages made in an elementary or secondary school cafeteria primarily to students of the school is exempt, except where the supply is for a reception, meeting, party or similar private event.

This section does not apply to prescribed food or beverages or food or beverages supplied through a vending machine.

1991, c. 67, s. 131.

132. A supply of a meal to a student enrolled at a university or public college is exempt where the meal is provided under a plan that is for a period of at least one month and under which the student purchases from the supplier for a single consideration only the right to receive at a restaurant or cafeteria at the university or college at least 10 meals weekly throughout the period.

1991, c. 67, s. 132; 1997, c. 85, s. 486.

133. A supply of food or beverages, including catering services, made to a school authority, public college or university under a contract to provide food or beverages either to students under a plan referred to in section 132 or in an elementary or secondary school cafeteria primarily to students of the school is exempt.

This section does not apply to the extent that the food, beverages or service are provided for a reception, conference or other special occasion or event.

1991, c. 67, s. 133.

134. A supply of movable property made by way of lease by a school authority to an elementary or secondary school student is exempt.

1991, c. 67, s. 134.

135. A supply made by a school authority, public college or university of an educational service that consists in instructing individuals in, or administering an examination in respect of, a course is exempt where the service is part of a program that consists of two or more courses and is subject to the review of, and is approved by, the school authority, college or university.

This section does not apply to courses in sports, games, hobbies or other recreational pursuits that are designed to be taken primarily for recreational purposes.

1991, c. 67, s. 135; 1994, c. 22, s. 427.

DIVISION IV CHILD AND PERSONAL CARE SERVICE

136. A supply of a child care service, the primary purpose of which is to provide care and supervision to children 14 years of age or under for periods normally less than 24 hours per day is exempt.

However, the supply does not include a supply of a service of supervising an unaccompanied child made by a person in connection with a taxable supply by that person of a passenger transportation service.

1991, c. 67, s. 136; 2001, c. 53, s. 297.

137. A supply of a service of providing care and supervision and a place of residence for children or disabled or underprivileged individuals in an institution operated by the supplier for the purpose of providing such services is exempt.

1991, c. 67, s. 137; 1992, c. 21, s. 375; 1994, c. 22, s. 428.

137.1. A supply of a service of providing care and supervision to a person with limited physical or mental capacity for self-supervision and self-care due to an infirmity or disability is an exempt supply if the service is rendered primarily at an establishment of the supplier.

2001, c. 53, s. 298.

DIVISION V LEGAL AID SERVICE

138. A supply of a professional legal aid service provided under a legal aid program authorized by the Gouvernement du Québec and made by a corporation responsible for administering legal aid under the Legal Aid Act (chapter A-14) is exempt.

1991, c. 67, s. 138.

DIVISION V.1 CHARITIES

1997, c. 85, s. 487.

138.1. A supply made by a charity of any property or service is exempt, except a supply of

(1)  property or a service referred to in Chapter IV;

(2)  property or a service the supply of which is deemed under this Title, except section 60, to have been made by the charity;

(3)  movable property, other than property that was acquired, manufactured or produced by the charity for the purpose of making a supply by way of sale of the property, where, immediately before the time tax would be payable in respect of the supply if it were a taxable supply, the property was used, otherwise than in making the supply, in the course of commercial activities of the charity or, in the case of capital property, primarily in such activities;

(4)  corporeal movable property that was acquired, manufactured or produced by the charity for the purpose of making a supply of the property and was neither donated to the charity nor used by another person before its acquisition by the charity, or any service supplied by the charity in respect of such property, other than such property or such a service supplied by the charity under a contract for catering;

(4.1)  a specified service as defined in section 350.17.1 if the supply is made to a registrant at a time when a designation of the charity under sections 350.17.1 to 350.17.4 is in effect;

(5)  an admission in respect of a place of amusement unless the maximum consideration for a supply by the charity of such an admission does not exceed one dollar;

(6)  a service involving, or a membership or other right entitling a person to, instruction or supervision in any recreational or athletic activity except where

(a)  it could reasonably be expected, given the nature of the activity or the degree of relevant skill or ability required for participation in it, that such services, memberships or rights supplied by the charity would be provided primarily to children 14 years of age or under and the services are not supplied as part of, membership is not in, or the right is not in respect of, a program involving overnight supervision throughout a substantial portion of the program, or

(b)  such services, memberships or rights supplied by the charity are intended to be provided primarily to individuals who are underprivileged or who have a disability;

(7)  a membership, other than a membership described in subparagraphs a and b of paragraph 6, where the membership

(a)  entitles the member to an admission in respect of a place of amusement the supply of which, were it made separately from the supply of the membership, would be a taxable supply, or to a discount on the value of consideration for a supply of such an admission, except where the value of the admission or discount is insignificant in relation to the consideration for the membership, or

(b)  includes a right to participate in a recreational or athletic activity, or use facilities, at a place of amusement, except where the value of the right is insignificant in relation to the consideration for the membership;

(8)  services of performing artists in a performance where the supply is made to a person who makes taxable supplies of admissions in respect of the performance;

(9)  a right, other than an admission, to play or participate in a game of chance where the charity is a prescribed person or the game is a prescribed game of chance;

(10)  a residential complex, or an interest therein, where the supply is made by way of sale;

(11)  an immovable where the supply is made by way of sale to an individual or a personal trust, other than a supply of an immovable on which is situated a structure that was used by the charity as an office or in the course of commercial activities or of making exempt supplies;

(12)  an immovable where, immediately before the time tax would be payable in respect of the supply if it were a taxable supply, the immovable was used, otherwise than in making the supply, primarily in commercial activities of the charity; or

(13)  an immovable in respect of which an election under section 272 is in effect at the time tax would become payable in respect of the supply if it were a taxable supply.

1997, c. 85, s. 487; 2001, c. 53, s. 299.

138.2. A supply made by a charity of an admission to a fund-raising dinner, ball, concert, show or like fund-raising activity is exempt where part of the consideration for the supply may reasonably be regarded as an amount that is donated to charity and in respect of which a receipt referred to in section 712 or 752.0.10.3 of the Taxation Act (chapter I-3) may be issued or could be issued if the recipient of the supply were an individual.

1997, c. 85, s. 487.

138.3. A supply by way of sale of movable property or a service made by a charity in the course of a fund-raising activity is exempt, but does not include

(1)  a supply of any property or service where the charity makes supplies of such property or services in the course of that activity on a regular or continuous basis throughout the year or a significant portion of the year;

(2)  a supply of any property or service where the agreement for the supply entitles the recipient to receive from the charity property or services on a regular or continuous basis throughout the year or a significant portion of the year;

(3)  a supply of property or a service referred to in any of paragraphs 1 to 3 or 9 of section 138.1; or

(4)  a supply of an admission in respect of a place of amusement at which the principal activity is the placing of bets or the playing of games of chance.

1997, c. 85, s. 487.

138.4. A supply made by a charity of food or beverages to seniors, underprivileged individuals or individuals with a disability under a program established and operated for the purpose of providing prepared food to such individuals in their places of residence and any supply of food or beverages made to the charity for the purposes of the program are exempt.

1997, c. 85, s. 487.

138.5. A supply made by a charity of any property or service, other than a supply of blood or blood derivatives, is exempt where all or substantially all of the supplies of the property or service by the charity are made for no consideration.

1997, c. 85, s. 487.

138.6. A supply by way of sale made by a charity to a recipient of corporeal movable property, other than capital property of the charity, or of a service purchased by the charity for the purpose of making a supply by way of sale of the service, is exempt where the total charge for the supply is equal to the usual charge by the charity for such supplies to such recipients and

(1)  if the charity does not charge the recipient any amount as tax in respect of the supply, the total charge for the supply does not, and could not reasonably be expected to, exceed the direct cost of the supply; and

(2)  if the charity charges the recipient an amount as tax in respect of the supply, the consideration for the supply, determined without reference to tax imposed under Part IX of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15), does not, and could not reasonably be expected to, equal or exceed the direct cost of the supply determined without reference to tax imposed under Part IX of the Excise Tax Act and without reference to any tax that became payable under this Title at a time when the charity was a registrant.

1997, c. 85, s. 487; 2001, c. 53, s. 300.

138.6.1. A supply made by a charity of food, beverages or short-term accommodation is exempt if the supply is made in the course of an activity the purpose of which is to relieve poverty, suffering or distress of individuals and is not fund-raising.

2001, c. 53, s. 301.

138.7. A supply made by a charity of an admission in respect of a place of amusement at which the principal activity is the placing of bets or the playing of games of chance is exempt where

(1)  the administrative function and the other functions performed in operating the game and taking the bets are performed exclusively by volunteers; and

(2)  in the case of a bingo or casino, the game is not conducted in premises or at a place, including any temporary structure, that is used primarily for the purpose of conducting gambling activities.

1997, c. 85, s. 487.

DIVISION VI PUBLIC SECTOR BODY

139. In this division,

“authorized party” means a party, including any regional or local association of the party, a candidate or a referendum committee governed by an Act of the Legislature of Québec or of the Parliament of Canada that imposes requirements relating to election finances or referendum expenses;

“designated activity” of an organization means an activity in respect of which the organization is designated to be a municipality for the purposes of section 165 or 166 or sections 383 to 397;

“designated body of the Gouvernement du Québec” means a body that is established by the Gouvernement du Québec and designated to be a municipality for the purposes of sections 383 to 397;

“local municipality” of a regional municipality means a municipality that has jurisdiction over an area that forms part of the territory of the regional municipality;

“municipal body” means a municipality or a designated body of the Gouvernement du Québec;

“municipal transit service” means a public passenger transportation service, other than a charter service or a service that is part of a tour, that is supplied by a transit authority all or substantially all of whose supplies are of public passenger transportation services provided within and in the vicinity of the territory of a municipality;

“para-municipal organization” of a municipal body means an organization, other than a government, of the municipal body and that

(1)  where the municipal body is a municipality,

(a)  is designated to be a municipality for the purposes of section 165 or 166 or sections 383 to 397, or

(b)  is established by the municipal body and is a municipality by reason of paragraph 2 of the definition of “municipality” in section 1; or

(2)  where the municipal body is a designated body of the Gouvernement du Québec, is a municipality by reason of paragraph 2 of the definition of “municipality” in section 1;

“public sector body” does not include a charity;

“public service body” does not include a charity;

“regional municipality” means a municipality that has general jurisdiction over the territory of more than one local municipality within the meaning of the Act respecting municipal territorial organization (chapter O-9);

“transit authority” means

(1)  a division, department or agency of a government, a municipality or a school authority, the primary purpose of which is to supply public passenger transportation services;

(2)  a non-profit organization that

(a)  receives funding from a government, municipality or school authority to support the supply of public passenger transportation services; or

(b)  that is established and operated for the purpose of providing public passenger transportation services to disabled individuals.

1991, c. 67, s. 139; 1994, c. 22, s. 429; 1996, c. 2, s. 952; 1997, c. 85, s. 488.

140. (Repealed).

1991, c. 67, s. 140; 1997, c. 85, s. 489.

140.1. For the purposes of the definition of “para-municipal organization” in section 139, such an organization is the organization of a municipal body if

(1)  all or substantially all of the shares of the organization are owned by the municipal body or all or substantially all of the assets held by the organization are owned by the municipal body or are assets the disposition of which is controlled by the municipal body so that, in the event of a winding-up of the organization, those assets are vested in the municipal body; or

(2)  the organization is required to submit to the municipal body the periodic operating and, where applicable, capital budget of the organization for approval and a majority of the members of the governing body of the organization are appointed by the municipal body.

1994, c. 22, s. 430.

141. A supply made by a public institution of movable property or a service is exempt, except a supply of

(1)  property or a service provided for in Chapter IV;

(2)  property or a service the supply of which is deemed under this Title to have been made by the institution;

(3)  property, other than capital property of the institution or property that was acquired, manufactured or produced by the institution for the purpose of making a supply of the property, where, immediately before the time tax would be payable in respect of the supply if it were a taxable supply, the property was used, otherwise than in making the supply, in the course of commercial activities of the institution;

(4)  capital property of the institution where, immediately before the time tax would be payable in respect of the supply if it were a taxable supply, the property was used, otherwise than in making the supply, primarily in commercial activities of the institution;

(5)  corporeal property that was acquired, manufactured or produced by the institution for the purpose of making a supply of the property and was neither donated to the institution nor used by another person before its acquisition by the institution, or any service supplied by the institution in respect of such property, other than such property or such a service supplied by the institution under a contract for catering;

(6)  property made by way of lease, licence or similar arrangement in conjunction with a supply of an immovable referred to in paragraph 6 of section 168;

(7)  property or a service made by the institution under a contract for catering, for an event or occasion sponsored or arranged by another person who contracts with the institution for such supply;

(8)  a membership where the membership

(a)  entitles the member to supplies of admissions in respect of a place of amusement that would be taxable supplies if they were made separately from the supply of the membership, or to discounts on the value of consideration for such supplies, except where the value of the supplies or discount is insignificant in relation to the consideration for the membership; or

(b)  includes a right to participate in a recreational or athletic activity, or use facilities, at a place of amusement, except where the value of the right is insignificant in relation to the consideration for the membership;

(9)  services of performing artists in a performance where the supply is made to a person who makes taxable supplies of admissions in respect of the performance;

(10)  a service involving, or a membership or other right entitling a person to, supervision or instruction in any recreational or athletic activity;

(11)  a right to play or participate in a game of chance;

(12)  a service of instructing individuals in, or administering examinations in respect of, any course where the supply is made by a vocational school, as defined in section 120, or a school authority, public college or university; or

(13)  an admission in respect of

(a)  a place of amusement,

(b)  a seminar, conference or similar event where the supply is made by a public college or a university; or

(c)  any fund-raising event.

1991, c. 67, s. 141; 1993, c. 19, s. 185; 1994, c. 22, s. 431; 1995, c. 1, s. 273; 1997, c. 85, s. 490.

142. (Repealed).

1991, c. 67, s. 142; 1997, c. 85, s. 491.

143. (Repealed).

1991, c. 67, s. 143; 1994, c. 22, s. 432; 1997, c. 85, s. 491.

143.1. A supply made by a public institution of an admission to a fund-raising dinner, ball, concert, show or like fund-raising activity is exempt where part of the consideration for the supply may reasonably be regarded as an amount that is donated to the institution and in respect of which a receipt referred to in section 712 or 752.0.10.3 of the Taxation Act (chapter I-3) may be issued or could be issued if the recipient of the supply were an individual.

1997, c. 85, s. 492.

143.2. A supply by way of sale of movable property or a service made by a public institution in the course of a fund-raising activity is exempt, but does not include

(1)  a supply of any property or service where the institution makes supplies of such property or services in the course of that activity on a regular or continuous basis throughout the year or a significant portion of the year;

(2)  a supply of any property or service where the agreement for the supply entitles the recipient to receive from the institution property or services on a regular or continuous basis throughout the year or a significant portion of the year;

(3)  a supply of property or a service referred to in any of paragraphs 1 to 4 or 11 of section 141; or

(4)  a supply of an admission in respect of a place of amusement at which the principal activity is the placing of bets or the playing of games of chance.

1997, c. 85, s. 492.

144. A supply of corporeal movable property made by way of sale by a public sector body is exempt where

(1)  the body does not carry on the business of selling such property;

(2)  all the sales persons are volunteers;

(3)  the consideration for each item sold does not exceed $5; and

(4)  the property is not sold at an event at which supplies of property of the kind or class supplied are made by a person who carries on the business of selling such property.

This section does not apply to a supply of alcoholic beverages or tobacco products.

1991, c. 67, s. 144.

145. A supply made by a public sector body of an admission in respect of a place of amusement at which the principal activity is the placing of bets or the playing of games of chance is exempt where

(1)  the administrative functions and other functions performed in operating the game and taking the bets are performed exclusively by volunteers; and

(2)  in the case of a bingo or casino, the game is not conducted in premises or at a place, including any temporary structure, that is used primarily for the purpose of conducting gambling activities.

1991, c. 67, s. 145.

146. A supply made by a public institution or non-profit organization of a right, other than an admission, to play or participate in a game of chance is exempt.

This section does not apply to a supply made by a prescribed person or in the case of the supply of a prescribed game of chance.

1991, c. 67, s. 146; 1994, c. 22, s. 433; 1997, c. 85, s. 493.

147. A supply of a service is exempt when the service is deemed under section 60 to have been supplied

(1)  by a public institution or non-profit organization, other than a prescribed person; or

(2)  where the service is in respect of a bet made through the agency of a pari-mutuel system on a running, trotting or pacing horse-race.

1991, c. 67, s. 147; 1997, c. 85, s. 494.

148. A supply by way of sale made by a public service body to a recipient of corporeal movable property, other than capital property of the body, or of a service purchased by the body for the purpose of making a supply by way of sale of the service is exempt, where the total charge for the supply is equal to the usual charge by the body for such supplies to such recipients and

(1)  if the body does not charge the recipient any amount as tax in respect of the supply, the total charge for the supply does not, or could not reasonably be expected to, exceed the direct cost of the supply; and

(2)  if the body charges the recipient an amount as tax in respect of the supply, the consideration for the supply, determined without reference to tax imposed under Part IX of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15), does not, and could not reasonably be expected to, equal or exceed the direct cost of the supply determined without reference to tax imposed under Part IX of the Excise Tax Act and without reference to any tax that became payable under this Title at a time when the body was a registrant.

1991, c. 67, s. 148; 1994, c. 22, s. 434; 1997, c. 85, s. 495; 2001, c. 53, s. 302.

149. (Repealed).

1991, c. 67, s. 149; 1997, c. 85, s. 496.

150. (Repealed).

1991, c. 67, s. 150; 1997, c. 85, s. 496.

151. A supply made by a public sector body of an admission in respect of a place of amusement is exempt where the maximum consideration for a supply by the body of such an admission does not exceed one dollar.

1991, c. 67, s. 151; 1997, c. 85, s. 497.

152. A supply made by a public sector body of any property or service, other than a supply of blood or blood derivatives, is exempt where all or substantially all of the supplies of the property or service by the body are made for no consideration.

1991, c. 67, s. 152; 1997, c. 85, s. 497.

153. A supply of a right to be a spectator at a performance, competitive event or athletic event is exempt where all or substantially all of the performers, athletes or competitors taking part in the performance or event do not receive, directly or indirectly, remuneration for doing so, other than a reasonable amount as prizes, gifts or compensation for travel or other expenses incidental to the performers’, athletes’ or competitors’ participation in the performance or event, or grants paid by a government or a municipality to the performers, athletes or competitors, and where no advertisement or representation in respect of the performance or event features participants who are so remunerated.

However, a supply of a right to be a spectator at a competitive event in which cash prizes are awarded and in which any competitor is a professional participant in any competitive event does not constitute an exempt supply.

1991, c. 67, s. 153.

154. A supply made by a public sector body of a right of membership in a program established and operated by the body that consists of a series of supervised instructional classes or activities involving athletics, outdoor recreation, music, dance, arts, crafts or other hobbies or recreational pursuits is exempt where

(1)  it may reasonably be expected, given the nature of the classes or activities or the degree of relevant skill or ability required for participation in them, that the program will be provided primarily to children 14 years of age or under, except where the program involves overnight supervision throughout a substantial portion of the program; or

(2)  the program is provided primarily for underprivileged individuals or individuals with a disability.

The first paragraph also applies to a supply of services supplied as part of a program referred to in that paragraph.

1991, c. 67, s. 154; 1997, c. 85, s. 498.

155. A supply made by a public sector body of board and lodging, or recreational services, at a recreational camp or similar place under a program or arrangement for providing the board and lodging or services primarily to underprivileged individuals or individuals with a disability is exempt.

1991, c. 67, s. 155; 1997, c. 85, s. 499.

156. A supply made by a public sector body of food, beverages or short-term accommodation is exempt where the supply is made in the course of an activity the purpose of which is to relieve poverty, suffering or distress of individuals, and is not fund-raising.

1991, c. 67, s. 156.

157. A supply made by a public sector body of food or beverages to seniors, underprivileged individuals or individuals with a disability under a program established and operated for the purpose of providing prepared food to those individuals in their places of residence and any supply of food or beverages made to the public sector body for the purposes of the program are exempt.

1991, c. 67, s. 157; 1997, c. 85, s. 500.

158. (Repealed).

1991, c. 67, s. 158; 1994, c. 22, s. 435.

159. A supply of a membership in a public sector body, other than a membership in a club the main purpose of which is to provide dining, recreational or sporting facilities or in an authorized party, is exempt where each member does not receive a benefit by reason of the membership, other than

(1)  an indirect benefit that is intended to accrue to all members collectively;

(2)  the right to receive services supplied by the body that are in the nature of investigating, conciliating or settling complaints or disputes involving members;

(3)  the right to vote at or participate in meetings;

(4)  the right to receive or acquire property or services supplied to the member for consideration that is not part of the consideration for the membership and that is equal to the fair market value of the property or services at the time the supply is made;

(5)  the right to receive a discount on the value of the consideration for a supply to be made by the body where the total value of all such discounts to which a member is entitled by reason of the membership is insignificant in relation to the consideration for the membership; or

(6)  the right to receive periodic newsletters, reports or publications where, as the case may be,

(a)  their value is insignificant in relation to the consideration for membership, or

(b)  they provide information on the activities of the body or its financial status, other than newsletters, reports or publications the value of which is significant in relation to the consideration for the membership and for which a fee is ordinarily charged by the body to non-members.

This section does not apply where the body has made an election under this section in prescribed form containing prescribed information.

1991, c. 67, s. 159; 1994, c. 22, s. 436; 1997, c. 85, s. 501.

159.1. Notwithstanding section 159, where a public sector body has made an election under section 17 of Part VI of Schedule V to the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15), the body is deemed to have made an election under the second paragraph of section 159 and the election is deemed to become effective on the day an election under section 17 of Part VI of Schedule V to that Act is to become effective.

1997, c. 85, s. 502.

160. A supply of a membership made by an organization membership in which is required to maintain a professional status recognized by statute is exempt.

This section does not apply where the supplier has made an election under this section in prescribed form containing prescribed information.

1991, c. 67, s. 160; 1994, c. 22, s. 437.

160.1. A supply of a membership in an authorized party is exempt.

1997, c. 85, s. 503.

160.2. A supply made by an authorized party to a person is exempt where part of the consideration for the supply may reasonably be regarded as an amount (in this section referred to as the “amount contributed”) that is contributed to the authorized party and the person can claim a deduction or credit in determining the person’s tax payable under the Taxation Act (chapter I-3) or the Income Tax Act (Revised Statutes of Canada, 1985, chapter 1, 5th Supplement) in respect of the total of such amounts contributed.

1997, c. 85, s. 503.

161. A supply made by a public sector body of a right that confers borrowing privileges at a public lending library is exempt.

1991, c. 67, s. 161.

162. A supply of any of the following property or services made by a government or municipality or by a commission or other body established by a government or municipality is exempt:

(1)  a service of registering any property or filing any document in a property registration system;

(2)  a service of procuring a document by a court or filing a document in a court;

(2.1)  a service of filing of a document under an Act;

(3)  a quota, licence, permit or similar right, other than such a right supplied in respect of the bringing of alcoholic beverages into Québec and any service in respect of an application for such a right;

(4)  a service of providing information in respect of, or of any certificate or other document evidencing, the vital statistics, residency, citizenship or right to vote of any person, the registration of any person for any service provided by a government or any other status of any person;

(5)  a service of providing information, or a certificate or other document, in respect of

(a)  the title to, or any right in, property,

(b)  any encumbrance or assessment in respect of property, or

(c)  the zoning of an immovable;

(6)  a service of providing information under the Access to Information Act (Revised Statutes of Canada, 1985, chapter A-1), the Privacy Act (Revised Statutes of Canada, 1985, chapter P-21) or the Act respecting Access to documents held by public bodies and the Protection of personal information (chapter A-2.1);

(7)  a law enforcement service or fire safety service, made to a government or a municipality or to a commission or other body established by a government or municipality;

(8)  a service of collecting garbage, including recyclable materials; and

(9)  a right to deposit refuse at a refuse disposal site.

1991, c. 67, s. 162; 1994, c. 22, s. 438; 1995, c. 63, s. 345; 1997, c. 85, s. 504; 2000, c. 20, s. 175.

162.1. A supply made to a municipality, or to a commission or other body established by a municipality, of a service of receiving and processing telephone calls through a 9-1-1 emergency centre is exempt.

1999, c. 83, s. 311.

163. Notwithstanding section 162, the following supplies are not exempt:

(1)  a supply to a consumer of a right to hunt or fish;

(2)  a supply of a right to take or remove forestry products, products that grow in water, fishery products, minerals or peat, where the supply is made to

(a)  a consumer; or

(b)  a person who is not a registrant and who acquires the right in the course of a business of the person of making supplies of the products, minerals or peat to consumers;

(3)  a supply of a right to enter, to have access to or to use property of the Government, a municipality or another body.

1991, c. 67, s. 163; 1994, c. 22, s. 439.

164. A supply of a municipal service made by or on behalf of a government or municipality to owners or occupants of immovables situated in a particular geographic area is exempt where

(1)  the owners or occupants have no option but to receive the service; or

(2)  the service is supplied because of a failure by an owner or occupant to comply with an obligation imposed under a law.

This section does not include a supply of a service of testing or inspecting any property for the purpose of verifying or certifying that the property meets particular standards of quality or is suitable for consumption, use or supply in a particular manner.

1991, c. 67, s. 164; 1997, c. 85, s. 505.

164.1. A supply made by a municipality or a board, commission or other body established by a municipality of any of the following services is exempt:

(1)  a service of installing, replacing, repairing or removing street or road signs or barriers, street or traffic lights or property similar to any of the foregoing;

(2)  a service of removing snow, ice or water;

(3)  a service of removing, cutting, pruning, treating or planting vegetation;

(4)  a service of repairing or maintaining roads, streets, sidewalks or similar or adjacent property; and

(5)  a service of installing accesses or egresses.

1997, c. 85, s. 506.

165. A supply of a service, made by a municipality or by an organization that operates a water distribution, sewerage or drainage system and that is designated by the Minister to be a municipality for the purposes of this section, of installing, repairing, maintaining, or interrupting the operation of a water distribution, sewerage or drainage system, is exempt.

1991, c. 67, s. 165; 1994, c. 22, s. 440; 1997, c. 85, s. 507.

166. The following supplies are exempt:

(1)  a supply of unbottled water when made by a person other than a government or by a government designated by the Minister to be a municipality for the purposes of this section;

(2)  a supply of the service of delivering water, when the service is supplied by the supplier of the water and that supply of water is described in subparagraph 1.

This section does not apply to a supply of unbottled water that is a zero-rated supply or a supply of water dispensed in single servings to consumers through a vending machine or at a permanent establishment of the supplier.

1991, c. 67, s. 166; 1994, c. 22, s. 440; 1997, c. 85, s. 507.

167. A supply made to a member of the public of a municipal transit service or of a public passenger transportation service designated by the Minister to be a municipal transit service is exempt.

1991, c. 67, s. 167; 1997, c. 85, s. 507.

168. A supply of an immovable made by a public service body, other than a government, is exempt, except a supply of

(1)  a residential complex or an interest therein where the supply is made by way of sale;

(2)  an immovable where the supply is deemed under this title to have been made;

(3)  an immovable where the supply is made by way of sale to an individual or a personal trust, other than a supply of an immovable on which is situated a structure that was used by the body as an office or in the course of commercial activities or of making exempt supplies;

(4)  an immovable where, immediately before the time tax would be payable in respect of the supply if it were a taxable supply, the property was used, otherwise than in making the supply, primarily in commercial activities of the body;

(5)  short-term accommodation where the supply is made by a non-profit organization, municipality, university, public college or school authority;

(6)   an immovable, other than short-term accommodation, where the supply is made by way of lease, where the period throughout which continuous possession or use of the property is provided under the lease is less than one month, or a licence, where the supply is made in the course of a business carried on by the body;

(7)  an immovable in respect of which an election under section 272 is in effect at the time tax would become payable under this title in respect of the supply if it were a taxable supply;

(8)  a parking space where the supply is made by way of lease, licence or similar arrangement in the course of a business carried on by the body; or

(9)  an immovable the last supply of which to the body was deemed to have been made under section 320.

1991, c. 67, s. 168; 1994, c. 22, s. 441; 1997, c. 85, s. 508.

169. A supply made by a particular non-profit organization established primarily for the benefit of organized labour is exempt where the supply is made to

(1)  a trade union, association or body referred to in section 172 that is a member of or affiliated with the particular organization; or

(2)  another non-profit organization established primarily for the benefit of organized labour,

and a supply made by a person referred to in paragraph 1 or 2 is exempt where the supply is made to any such organization.

1991, c. 67, s. 169.

169.1. A supply of a poppy or wreath made by the Minister of Veterans Affairs in the course of operating a sheltered employment workshop, by the Dominion Command, or by any provincial command or branch of the Royal Canadian Legion, is exempt.

1994, c. 22, s. 442.

169.2. A supply between the following persons is exempt:

(1)  a municipal body and any of its para-municipal organizations;

(2)  a para-municipal organization of a municipal body and any other para-municipal organization of the municipal body;

(3)  a regional municipality and any of its local municipalities or any para-municipal organization of any of those local municipalities;

(4)  a para-municipal organization of a regional municipality and any local municipality of the regional municipality or any para-municipal organization of the local municipality; or

(5)  a regional municipality or any of its para-municipal organizations and any other organization, other than a government, the designated activities of which include the provision of water or municipal services within a territory over which the regional municipality has jurisdiction.

This section does not apply to a supply of electricity, gas, steam or telecommunication services made by a municipal body or a para-municipal organization, or a branch or division thereof, that acts as a public utility, or any supply made or received by the following persons otherwise than in the course of their designated activities:

(1)  a designated body of the Gouvernement du Québec;

(2)  a para-municipal organization designated as a municipality for the purposes of section 165 or 166 or sections 383 to 397; or

(3)  another organization referred to in subparagraph 5 of the first paragraph.

1994, c. 22, s. 442; 1997, c. 85, s. 509.

DIVISION VII FERRY, ROAD OR BRIDGE TOLL

170. A supply, other than a zero-rated supply, of a service of ferrying by watercraft passengers or property where the principal purpose of the ferrying is to transport motor vehicles and passengers between parts of a road or highway system that are separated by a stretch of water is exempt.

1991, c. 67, s. 170; 1994, c. 22, s. 443.

171. A supply of a right to use a road or bridge where a toll is charged for the right is exempt.

1991, c. 67, s. 171.

DIVISION VIII DUES

172. Where an amount is paid by a person to an organization as

(1)  a membership due paid to a trade union as defined

(a)  in section 3 of the Canada Labour Code (Revised Statutes of Canada, 1985, chapter L-2); or

(b)  in any provincial Act providing for the investigation, conciliation or settlement of industrial disputes,

or to an association of public servants the primary object of which is to promote the improvement of the members’ conditions of employment or work,

(2)  a due that was, pursuant to the provisions of a collective agreement, retained by the person from an individual’s remuneration and paid to a trade union or association referred to in paragraph 1 of which the individual was not a member, or

(3)  a due to a parity or advisory committee or similar body, the payment of which was required under the laws of a province in respect of an individual’s employment,

the organization is deemed to have made an exempt supply to the person and the amount is deemed to be consideration for the supply.

1991, c. 67, s. 172.

DIVISION IX FEES PAID TO A GOVERNMENT

1994, c. 22, s. 444.

172.1. Where a government or municipality or a board, commission or other body established by a government or municipality collects from the holder of or applicant for a right the supply of which is referred to in paragraph 3 of section 162 an amount that is levied for the purpose of recovering the costs of administration of a regulatory program relating to the right and the holder’s or the applicant’s failure to pay the amount would result in a loss of, a restriction in the exercise of, a change in the person’s entitlements under, or a denial of, the right,

(1)  the government, municipality, board, commission or other similar body is deemed to have made an exempt supply to the person; and

(2)  the amount is deemed to be consideration for that supply.

1994, c. 22, s. 444.

CHAPTER IV ZERO-RATED SUPPLY

DIVISION I DRUGS AND BIOLOGICALS

1994, c. 22, s. 445.

173. For the purposes of this division,

“medical practitioner” means a physician within the meaning of the Medical Act (chapter M-9) or a dentist within the meaning of the Dental Act (chapter D-3) and includes a person who is entitled under the laws of another province, the Northwest Territories or the Yukon Territory to practise the profession of medicine or dentistry;

“pharmacist” has the meaning assigned by the Pharmacy Act (chapter P-10) and includes a person who is entitled under the laws of another province, the Northwest Territories or the Yukon Territory to practise the profession of pharmacy;

“prescription” means a written or verbal order, given to a pharmacist by a medical practitioner, directing that a stated amount of any drug or mixture of drugs specified in the order be dispensed for the individual named in the order.

1991, c. 67, s. 173; 1997, c. 85, s. 510.

174. The following are zero-rated supplies:

(1)  a supply of any of the following drugs, except where they are labelled or supplied for agricultural or veterinary use only:

(a)  a drug described in Schedules C and D to the Food and Drugs Act (Revised Statutes of Canada, 1985, chapter F-27);

(b)  a drug described in Schedule F to the Food and Drug Regulations made under the Food and Drugs Act, other than a drug or mixture of drugs that may be sold to a consumer without a prescription pursuant to that Act or those regulations;

(c)  a drug or other substance included in the schedule to Part G of the Food and Drug Regulations made under the Food and Drugs Act;

(d)  a drug that contains a substance included in the schedule to the Narcotic Control Regulations made under the Controlled Drugs and Substances Act (Statutes of Canada, 1996, chapter 19), other than a drug or mixture of drugs that may be sold to a consumer without a prescription pursuant to that Act or regulations made under that Act; and

(e)  Deslanoside, Digitoxin, Digoxin, Isosorbide dinitrate, Epinephrine and its salts, Nitroglycerine, Medical oxygen, Prenylamine, Quinidine and its salts or Erythrityl tetranitrate;

(f)  a drug the supply of which is authorized under the Food and Drug Regulations made under the Food and Drugs Act for use in an emergency treatment;

(2)  a supply of a drug when the drug is for human use and is dispensed

(a)  by a medical practitioner to an individual for the personal consumption or use of the individual or an individual related thereto; or

(b)  on the prescription of a medical practitioner for the personal consumption or use of the individual named in the prescription;

(3)  a supply of a service of dispensing a drug where the supply of the drug is provided for in this division;

(4)  a supply of human sperm.

1991, c. 67, s. 174; 1994, c. 22, s. 446; 1997, c. 85, s. 511; 2001, c. 53, s. 303.

DIVISION II MEDICAL AND ASSISTIVE DEVICES

1997, c. 85, s. 512.

175. For the purposes of this division, “medical practitioner” means a physician within the meaning of the Medical Act (chapter M-9) and includes a person who is entitled under the laws of another province, the Northwest Territories or the Yukon Territory to practise the profession of medicine.

1991, c. 67, s. 175; 1997, c. 85, s. 513.

176. The following are zero-rated supplies:

(1)  a supply of a communication device, other than a device described in paragraph 6, that is specially designed for use by a person with a hearing, speech or vision impairment;

(2)  a supply of a heart-monitoring device when the device is supplied on the written order of a medical practitioner for use by a consumer with heart disease who is named in the order;

(3)  a supply of a hospital bed when the bed is supplied to the operator of a health care institution, within the meaning of section 108, or on the written order of a medical practitioner for use by an incapacitated person named in the order;

(4)  a supply of an artificial breathing apparatus that is specially designed for use by a person with a respiratory disorder;

(4.1)  a supply of an aerosol chamber or a metered dose inhaler for use in the treatment of asthma when the chamber or inhaler is supplied on the written order of a medical practitioner for use by a consumer named in the order;

(4.2)  a supply of a respiratory monitor, nebulizer, tracheostomy supply, gastro-intestinal tube, dialysis machine, infusion pump or intravenous apparatus, that can be used in the residence of a person;

(5)  a supply of a mechanical percussor for postural drainage treatment;

(6)  a supply of a device that is designed to convert sound to light signals when the device is supplied on the written order of a medical practitioner for use by a consumer with a hearing impairment who is named in the order;

(7)  a supply of a selector control device that is specially designed to enable a person with a disability to energize, select or control household, industrial or office equipment;

(8)  a supply of ophthalmic lenses, with or without frames, when the lenses are, or are to be, supplied on the written order of an eye-care professional for the treatment or correction of a defect of vision of a consumer named in the order, where the eye-care professional is entitled under the laws of Québec, another province, the Northwest Territories or the Yukon Territory in which the professional practices to prescribe lenses for such purpose;

(9)  a supply of an artificial eye;

(10)  a supply of artificial teeth;

(10.1)  a supply of an orthodontic appliance;

(11)  a supply of a hearing aid;

(12)  a supply of a laryngeal speaking aid;

(13)  a supply of a chair, commode chair, walker, wheelchair lift or similar aid to locomotion, with or without wheels, including motive power and wheel assemblies therefor, that is specially designed for use by a person with a disability;

(14)  a supply of a patient lifter that is specially designed to move a disabled person;

(15)  a supply of a wheelchair ramp that is specially designed for access to a motor vehicle;

(16)  a supply of a portable wheelchair ramp;

(17)  a supply of an auxiliary driving control that is designed for attachment to a motor vehicle to facilitate the operation of the vehicle by a person with a disability;

(17.1)  a supply of a service of modifying a motor vehicle to adapt the vehicle for the transportation of a person using a wheelchair and a supply of property, other than the vehicle, made in conjunction with, and because of, the supply of the service;

(18)  a supply of a patterning device that is specially designed for use by a disabled person;

(19)  a supply of a bath-seat, shower-seat or toilet-seat that is specially designed for use by a disabled person;

(20)  a supply of an insulin infusion pump or an insulin syringe;

(20.1)  a supply of an extremity pump, intermittent pressure pump or similar device for use in the treatment of lymphedema when the pump or device is supplied on the written order of a medical practitioner for use by a consumer named in the order;

(20.2)  a supply of a catheter for subcutaneous injections when the catheter is supplied on the written order of a medical practitioner for use by a consumer named in the order;

(20.3)   a supply of a lancet;

(21)  a supply of an artificial limb;

(22)  a supply of an orthotic or orthopaedic device that is made to order for a person or is supplied on the written order of a medical practitioner for use by a consumer named in the order;

(22.1)  (paragraph repealed);

(23)  a supply of a specially constructed appliance that is made to order for a person who has a crippled or deformed foot or ankle;

(23.1)  a supply of footwear that is specially designed for use by a person who has a crippled or deformed foot or other similar disability, when the footwear is supplied on the written order of a medical practitioner;

(24)  a supply of a medical or surgical prosthesis, or an ileostomy, colostomy or urinary appliance or similar article that is designed to be worn by a person;

(25)  a supply of an article or material, not including a cosmetic, for use by a user of, and necessary for the proper application and maintenance of an article described in paragraph 24; “cosmetic” means a property, whether or not possessing therapeutic or prophylactic properties, commonly or commercially known as a toilet article, preparation or cosmetic that is intended for use or application for toilet purposes or for use in connection with the care of the human body, or any part thereof, whether for preserving, deodorizing, beautifying, cleansing or restoring and, for greater certainty, includes a denture cream or adhesive, antiseptic, skin cream or lotion, mouth wash, depilatory, scent, perfume, toothpaste, tooth powder, bleach, oral rinse, toilet soap and any similar toilet article, cosmetic or preparation;

(26)  a supply of a crutch or cane that is specially designed for use by a person with a disability;

(27)  a supply of a blood-glucose monitor or meter;

(28)  a supply of blood-ketone, urinary-ketone, blood-sugar, or urinary-sugar testing strips or urinary-ketone or urinary-sugar reagents or tablets;

(29)  a supply of any article that is specially designed for the use of blind persons when the article is supplied to or by the Canadian National Institute for the Blind or any other bona fide association or institution for blind persons for use by a blind person or on the order or certificate of a medical practitioner;

(30)  a supply of a prescribed property or service;

(31)  a supply of a part, accessory or attachment that is specially designed for a property described in this division;

(32)  a supply of a dog that is or is to be trained as a guide dog for the use of a blind person, including the service of training the person to use the dog, where the supply is made to or by an organization that is operated for the purpose of supplying guide dogs to blind persons; and

(32.1)  a supply of a dog that is or is to be trained to assist a person with a hearing impairment in respect of problems arising from the impairment, including a service of training the person to use such a dog, where the supply is made to or by an organization that is operated for the purpose of supplying such dogs to persons with hearing impairments;

(33)  a supply of a service, other than a service the supply of which is included in any provision of Division II of Chapter III except section 116 and a service related to the provision of a surgical or dental service that is performed for cosmetic purposes and not for medical or reconstructive purposes, of maintaining, installing, modifying, repairing or restoring a property described in any of paragraphs 1 to 31 and 36 to 39, or any part of such a property where the part is supplied in conjunction with the service;

(34)  a supply of a graduated compression stocking, an anti-embolic stocking or similar article when the stocking or article is supplied on the written order of a medical practitioner for use by a consumer named in the order;

(35)  a supply of clothing that is specially designed for use by a person with a disability when the clothing is supplied on the written order of a medical practitioner for use by a consumer named in the order;

(36)  a supply of an incontinence product that is specially designed for use by a person with a disability;

(37)  a supply of a feeding utensil or other gripping device that is specially designed for use by a person with impaired use of hands or other similar disability;

(38)  a supply of a reaching aid that is specially designed for use by a person with a disability;

(39)  a supply of a prone board that is specially designed for use by a person with a disability.

1991, c. 67, s. 176; 1994, c. 22, s. 447; 1995, c. 1, s. 275; 1997, c. 85, s. 514; 2001, c. 53, s. 304.

DIVISION III BASIC GROCERIES

177. Supplies of food or beverages for human consumption, including seasonings, sweetening agents and other ingredients to be mixed with or used in the preparation of such food or beverages, other than supplies of the following, are zero-rated supplies:

(1)  beer, malt liquor, spirits, wine or other alcoholic beverages;

(1.1)  grapes, juice and concentrated or non-concentrated must, malt, malt extract and other similar products intended for the making of wine or beer;

(2)  (paragraph repealed);

(3)  carbonated beverages;

(4)  non-carbonated fruit juice beverages or fruit flavoured beverages, other than milk-based beverages, that contain less than 25% by volume of

(a)  a natural fruit juice or combination of natural fruit juices; or

(b)  a natural fruit juice or combination of natural fruit juices that have been reconstituted;

(5)  goods that, when added to water, produce a beverage described in paragraph 4;

(6)  candies, confectionery that may be classed as candy, or any goods sold as candies, such as candy floss, chocolate and chewing gum, whether naturally or artificially sweetened, and including fruits, seeds, popcorn and nuts when they are coated or treated with chocolate, molasses, honey, syrup, sugar, candy or artificial sweeteners;

(7)  sticks, chips or curls, such as cheese sticks, potato sticks, bacon crisps, corn chips, potato chips or cheese curls, and other similar snack foods, brittle pretzels or popcorn, but not including any product that is sold primarily as a breakfast cereal;

(8)  salted seeds or salted nuts;

(9)  granola products, but not including any product that is sold primarily as a breakfast cereal;

(10)  snack mixtures that contain cereals, dried fruit, seeds, nuts or any other edible product, but not including any mixture that is sold primarily as a breakfast cereal;

(11)  ice lollies, juice bars, flavoured, coloured or sweetened ice waters, or similar products, whether frozen or not;

(12)  ice cream, frozen pudding, ice milk, sherbet or frozen yoghurt, non-dairy substitutes for any of the foregoing, or any product that contains any of the foregoing, when packaged or sold in single servings;

(13)  fruit drops, rolls or bars or similar fruit-based snack foods;

(14)  doughnuts, cookies, croissants with sweetened coating, icing or filling, cakes, muffins, pastries, tarts, pies or similar products, but not including bread products without sweetened coating, icing or filling, such as bagels, croissants, English muffins or bread rolls, where

(a)  they are prepackaged for sale to consumers in quantities of less than six items each of which is a single serving, or

(b)  they are not prepackaged for sale to consumers and are sold as single servings in quantities of less than six;

(15)  pudding, including flavoured gelatine, mousse, flavoured whipped dessert product or any other products similar to pudding, or beverages, other than unflavoured milk, except

(a)  when prepared and prepackaged specially for consumption by babies,

(b)  when sold in multiples, prepackaged by the manufacturer or producer, of single servings, or

(c)  when the cans, bottles or other primary containers in which the beverages or products are sold contain a quantity exceeding a single serving;

(16)  food or beverages heated for consumption;

(16.1)  salads not canned or vacuum sealed;

(16.2)  sandwiches and similar products other than when frozen;

(16.3)  platters of cheese, fruit, vegetables or cold cuts and other arrangements of prepared food;

(16.4)  beverages dispensed at the place where they are sold;

(16.5)  food or beverages sold under a contract for, or in conjunction with, catering services;

(17)  food or beverages sold through a vending machine;

(18)  food or beverages sold at an establishment at which all or substantially all of the sales of food or beverages are sales of food or beverages described in any of paragraphs 1 to 17, except where

(a)  the food or beverage is sold in a form not suitable for immediate consumption, having regard to the nature of the product, the quantity sold or its packaging, or

(b)  in the case of a product described in paragraph 14, the product is not sold for consumption at the establishment and

i.  is prepackaged for sale to consumers in quantities of more than five items each of which is a single serving, or

ii.  is not prepackaged for sale to consumers and is sold as single servings in quantities of more than five; and

(19)  unbottled water, other than ice.

1991, c. 67, s. 177; 1994, c. 22, s. 448; 1997, c. 14, s. 334; 1997, c. 85, s. 515.

177.1. A supply of unbottled water for human consumption made to a consumer, when the water is dispensed in a quantity exceeding a single serving through a vending machine or at a permanent establishment of the supplier, is a zero-rated supply.

1994, c. 22, s. 449.

DIVISION IV AGRICULTURE AND FISHING

178. The following are zero-rated supplies:

(1)  a supply of bees, farm livestock, other than rabbits, or poultry that are ordinarily raised or kept to be used as or to produce food for human consumption or to produce wool;

(1.1)  a supply of a rabbit made otherwise than in the course of a business in the course of which animals are regularly supplied as pets to consumers;

(2)  a supply of grains or seeds in their natural state, treated for seeding purposes or irradiated for storage purposes, hay or silage, or other fodder crops, that are ordinarily used as, or to produce, food for human consumption or feed for farm livestock or poultry, when supplied in a quantity that is larger than the quantity that is ordinarily sold or offered for sale to consumers, but not including grains or seeds or mixtures thereof that are packaged, prepared or sold for use as feed for wild birds or as pet food;

(2.1)  a supply of feed, made by the operator of a feedlot, that is deemed to be a separate supply under paragraph 1 of section 39.2;

(3)  a supply of sugar beets, sugar cane, flax seed, hops, barley or straw;

(4)  a supply of poultry or fish eggs that are produced for hatching purposes;

(5)  a supply of fertilizer, other than a product sold as soil or as a soil mixture, whether or not containing fertilizer, made at any time to a recipient when the fertilizer is supplied in bulk, or in a container that contains at least 25 kg of fertilizer, where the total quantity of fertilizer supplied at that time to the recipient is at least 500 kg;

(6)  a supply of wool, not further processed than washed;

(7)  a supply of tobacco leaves, not further processed than dried and sorted;

(8)  a supply of fish or other marine or freshwater animals not further processed than frozen, filleted, scaled, eviscerated, smoked, salted, dried, other than any such animal that is not ordinarily used as food for human consumption or that is sold as bait in recreational fishing;

(9)  a supply made to a registrant of farmland by way of lease, licence or similar arrangement, to the extent that the consideration for the supply is a share of the production from the farmland of property the supply of which is a zero-rated supply; and

(10)  a supply of prescribed property.

1991, c. 67, s. 178; 1994, c. 22, s. 450; 1995, c. 1, s. 276; 1997, c. 85, s. 516.

DIVISION V SUPPLY SHIPPED OUTSIDE QUÉBEC

179. A supply of corporeal movable property, other than goods on which a duty of excise is imposed under the Excise Act (Revised Statutes of Canada, 1985, chapter E-14) or would be imposed under that Act if the goods were manufactured or produced in Canada, made by a person to a recipient, other than a consumer, who intends to ship the property outside Québec is a zero-rated supply where

(1)  in the case of property that is a continuous transmission commodity that the recipient intends to ship outside Québec by means of a wire, pipeline or other conduit, the recipient is not registered under Division I of Chapter VIII;

(2)  the recipient ships the property outside Québec as soon after the property is delivered by the person to the recipient as is reasonable having regard to the circumstances surrounding the shipment outside Québec and, where applicable, to the normal business practice of the recipient;

(3)  the property is not acquired by the recipient for consumption, use or supply in Québec before the shipment of the property outside Québec by the recipient;

(4)  after the supply is made and before the recipient ships the property outside Québec, the property is not further processed, transformed or altered in Québec except to the extent reasonably necessary or incidental to its transportation; and

(5)  the person maintains evidence satisfactory to the Minister of the shipment of the property outside Québec by the recipient or, where the recipient is authorized under section 427.3, the recipient provides the person with a certificate in which the recipient certifies that the property will be shipped outside Québec in the circumstances described in paragraphs 2 to 4.

1991, c. 67, s. 179; 1994, c. 22, s. 451; 1995, c. 63, s. 346; 2001, c. 53, s. 305.

180. A supply of property or a service, other than the supply of an immovable by way of sale, made to a person not resident in Québec who is not registered under Division I of Chapter VIII at the time the supply is made, is a zero-rated supply where the property or service is acquired by the person for consumption, use or supply

(1)  where the person carries on a business of transporting property or passengers to or from Québec or between places outside Québec by aircraft, railway or ship, in the course of so transporting property or passengers;

(2)  in the course of operating an aircraft or ship by or on behalf of a government of a province other than Québec, the Northwest Territories, the Yukon Territory or a country other than Canada; or

(3)  in the course of operating a ship for the purpose of obtaining scientific data outside Québec or for the laying or repairing of oceanic telegraph cables.

1991, c. 67, s. 180; 1997, c. 85, s. 517.

180.1. A supply of fuel is a zero-rated supply when it is made to a person who is registered under Division I of Chapter VIII at the time the supply is made, where

(1)  the person carries on a business of transporting property or passengers to or from Québec or between places outside Québec by aircraft, railway or ship; and

(2)  the fuel is acquired by the person for use in the course of so transporting property or passengers.

1994, c. 22, s. 452; 1997, c. 85, s. 518.

180.2. A supply of a pilotage service made to a person not resident in Québec who is not registered under Division I of Chapter VIII at the time the supply is made is a zero-rated supply where

(1)  the person carries on the business of transporting property or passengers by ship to and from places located outside Québec; and

(2)  the pilotage service is acquired by the person for consumption or use in the course of such transportation.

1995, c. 1, s. 277.

180.3. A supply of an air navigation service, as defined in subsection 1 of section 2 of the Civil Air Navigation Services Commercialization Act (Statutes of Canada, 1996, chapter 20), made to a person who is registered under Division I of Chapter VIII at the time the supply is made, is a zero-rated supply if

(1)  the person carries on a business of transporting passengers or property to or from Québec, or between places outside Québec, by aircraft; and

(2)  the air navigation service is acquired by the person for use in the course of so transporting passengers or property.

2001, c. 53, s. 306.

181. A supply of any goods on which a duty of excise is imposed under the Excise Act (Revised Statutes of Canada, 1985, chapter E-14) or would be imposed were they manufactured or produced in Canada and which the recipient exports in bond is a zero-rated supply.

1991, c. 67, s. 181.

182. A supply of a service, other than a transportation service, in respect of corporeal movable property ordinarily situated outside Québec and of any corporeal movable property supplied in conjunction with the service, is a zero-rated supply if

(1)  where the property is ordinarily situated outside Canada, the property is temporarily brought into Québec for the sole purpose of having the service performed and is taken or shipped outside Canada as soon as is practicable after the service is performed; or

(2)  where the property is ordinarily situated outside Québec but within Canada,

(a)  the property is temporarily brought into Québec for the sole purpose of having the service performed and is taken or shipped outside Québec but within Canada as soon as is practicable after the service is performed, and

(b)  the recipient is registered under Subdivision d of Division V of Part IX of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15).

1991, c. 67, s. 182; 1997, c. 85, s. 519; 1999, c. 83, s. 312.

183. A supply made to a person not resident in Québec of a service of acting as a mandatary of the person or of arranging for, procuring or soliciting orders for supplies by or to the person is a zero-rated supply, to the extent that the service is in respect of

(1)  a supply to the person that is provided for in this division; or

(2)  a supply made outside Québec by or to the person.

1991, c. 67, s. 183; 1997, c. 85, s. 519.

184. A supply made by a person to a recipient not resident in Québec of an emergency repair service, and of any corporeal movable property supplied in conjunction with the service, in respect of a conveyance or cargo container that is being used or transported by the person in the course of a business of transporting property or passengers, is a zero-rated supply.

1991, c. 67, s. 184; 1997, c. 85, s. 519.

184.1. A supply made to a person not resident in Québec who is not registered under Division I of Chapter VIII of an emergency repair service, and of any corporeal movable property supplied in conjunction with the service, in respect of railway rolling stock that is being used in the course of a business of transporting passengers or property, is a zero-rated supply.

1997, c. 85, s. 520.

184.2. A supply made to a person not resident in Québec who is not registered under Division I of Chapter VIII of an emergency repair service in respect of, or a service of storing, an empty cargo container, other than a container less than 6.1 metres in length or having an internal capacity less than 14 cubic metres, and any corporeal movable property supplied in conjunction with the repair service is a zero-rated supply, to the extent that the cargo container

(1)  is used in transporting property to or from Canada and is classified under heading No. 98.01 or subheading No. 9823.90 of Schedule I to the Customs Tariff (Revised Statutes of Canada, 1985, chapter 41, 3rd Supplement); or

(2)  is used in transporting property to or from Québec and would be classified under heading No. 98.01 or subheading No. 9823.90 of Schedule I to the Customs Tariff if the cargo container were from outside Québec.

1997, c. 85, s. 520.

185. A supply of a service made to a person not resident in Québec is a zero-rated supply, except a supply of

(1)  a service made to an individual who is in Québec at any time when the individual has contact with the supplier in relation to the supply;

(1.1)  a service that is rendered to an individual while that individual is in Québec;

(2)  an advisory, consulting or professional service;

(3)  a postal service;

(4)  a service in respect of an immovable situated in Québec;

(5)  a service in respect of corporeal movable property that is situated in Québec at the time the service is performed;

(6)  a service of acting as a mandatary of the person not resident in Québec, except a service of acting as a transfer agent in the case where the person is a corporation resident in Canada, or of arranging for, procuring or soliciting orders for supplies by or to the person;

(7)  a transportation service;

(8)  a telecommunication service.

1991, c. 67, s. 185; 1994, c. 22, s. 453; 1997, c. 85, s. 521; 2002, c. 9, s. 162.

186. A supply of a service of advertising made to a person not resident in Québec who is not registered under Division I of Chapter VIII at the time the service is performed is a zero-rated supply.

1991, c. 67, s. 186.

187. A supply made to a person not resident in Québec of an advisory, consulting or research service that is intended to assist the person in taking up residence or establishing a business venture in Québec is a zero-rated supply.

1991, c. 67, s. 187.

188. A supply of a patent, industrial design, copyright, invention, trade-mark, trade-name, trade secret or other intellectual property or any right, licence or privilege to use any such property is a zero-rated supply where the recipient is a person not resident in Québec who is not registered under Division I of Chapter VIII at the time the supply is made.

1991, c. 67, s. 188.

189. A supply of corporeal movable property made by a person operating a duty free shop licensed as such under the Customs Act (Revised Statutes of Canada, 1985, chapter 1, 2nd Supplement) to an individual at a duty free shop for export by the individual is a zero-rated supply.

1991, c. 67, s. 189.

189.1. A supply of corporeal movable property made by way of sale to a person operating a duty free shop licensed as such under the Customs Act (Revised Statutes of Canada, 1985, chapter 1, 2nd Supplement), where the person acquires the property as inventory for supply by way of sale at the shop to an individual for export by the individual and the person provides the supplier with the licence number of the shop, is a zero-rated supply.

1995, c. 63, s. 347.

190. A supply of corporeal movable property, other than a continuous transmission commodity that is being transported by means of a wire, pipeline or other conduit, is a zero-rated supply if the supplier

(1)  ships the property to a destination outside Québec that is specified in the contract for carriage of the property;

(2)  transfers possession of the property to a common carrier or consignee that has been retained, to ship the property to a destination outside Québec, by

(a)  the supplier on behalf of the recipient, or

(b)  the recipient’s employer; or

(3)  sends the property by mail or courier to an address outside Québec.

1991, c. 67, s. 190; 1997, c. 85, s. 522; 2001, c. 53, s. 307.

191. The following supplies, made to a person not resident in Québec who is not registered under Division I of Chapter VIII, are zero-rated supplies:

(1)  a supply of corporeal movable property or of a service performed in respect of corporeal movable property or an immovable where the property or service is acquired by the person for the purpose of fulfilling an obligation of the person under a warranty;

(2)  a supply of corporeal movable property where the supply is deemed, under section 327.1, to have been made following a transfer of possession of the property in performance of an obligation of the person under a warranty.

1991, c. 67, s. 191; 1994, c. 22, s. 454; 1995, c. 1, s. 278; 2001, c. 53, s. 308.

191.1. For the purposes of section 191.2,

“die” means a solid or hollow form used for shaping materials by stamping, pressing, extruding, drawing or threading;

“fixture” means a device for holding goods in process while working tools are in operation that does not contain any special arrangement for guiding the working tools;

“jig” means a device used in the accurate machining of goods in process by holding the goods firmly and guiding tools exactly to position;

“mould” means a hollow form, matrix or cavity into which materials are placed to produce goods of desired shapes;

“tool” means a device for use in, or attachment to, production machinery that is for the assembling of materials or the working of materials by turning, milling, grinding, polishing, drilling, punching, boring, shaping, shearing, pressing or planing.

1994, c. 22, s. 455.

191.2. A supply of property that is a fixture, jig, die, mould or tool, or an interest therein, made to a person not resident in Québec who is not registered under Division I of Chapter VIII at the time the supply is made is a zero-rated supply where the property is to be used directly in the manufacture or production of corporeal movable property for the person.

1994, c. 22, s. 455.

191.3. A supply of natural gas made by a person to a recipient who is not registered under Division I of Chapter VIII and who intends to ship the gas outside Québec by pipeline is a zero-rated supply if

(1)  the recipient ships the gas outside Québec as soon after it is delivered to the recipient by the supplier of the gas as is reasonable, or, where the recipient receives a supply of a service provided for a period in respect of the gas referred to in section 191.3.3 and subsequently ships the gas outside Québec as soon after it is delivered to the recipient as is reasonable at the end of the period having regard to the circumstances surrounding the shipment outside Québec and, where applicable, to the normal business practice of the recipient;

(2)  the gas is not acquired by the recipient for consumption or use in Québec, other than by a carrier as fuel or compressor gas to transport the gas by pipeline, or for supply in Québec, other than to supply natural gas liquids or ethane as described in section 54.3, before the shipment of the gas outside Québec by the recipient;

(3)  after the supply is made and before being shipped outside Québec, the gas is not further processed, transformed or altered in Québec, except to the extent reasonably necessary or incidental to its transportation, other than to recover natural gas liquids or ethane from the gas at a straddle plant; and

(4)  the person maintains evidence satisfactory to the Minister of the transmission of the gas outside Québec by the recipient.

1994, c. 22, s. 455; 2001, c. 53, s. 309.

191.3.1. The following supplies are zero-rated supplies:

(1)  a supply of a continuous transmission commodity made by a supplier (in this section referred to as the “first seller”) to a person (in this section referred to as the “first buyer”) who is not registered under Division I of Chapter VIII, if

(a)  the first buyer makes a supply of the commodity to a registrant and delivers it in Québec to the registrant,

(b)  all or part of the consideration for the first buyer’s supply of the commodity to the registrant is property of the same class or kind delivered to the first buyer outside Québec,

(c)  after the commodity is delivered to the first buyer and before the first buyer delivers it to the registrant,

i.  the first buyer does not use the commodity except, in the case of natural gas, to the extent that it is used by a carrier as fuel or compressor gas to transport the gas by pipeline, and

ii.  the commodity is not, except to the extent reasonably necessary or incidental to its transportation, further processed, transformed or altered other than, in the case of natural gas, to recover natural gas liquids or ethane from the gas at a straddle plant,

(d)  after the first seller’s supply is made and before the registrant receives delivery of the commodity, the commodity is not transported by any means other than a wire, pipeline or other conduit, and

(e)  the first seller maintains evidence satisfactory to the Minister of the first buyer’s supply of the commodity to the registrant; and

(2)  a supply of any service, supplied by the registrant to the first buyer, of arranging for or effecting the exchange of the commodity for the property of the same class or kind, if the first buyer is a person not resident in Québec.

2001, c. 53, s. 310.

191.3.2. A particular supply made by a supplier to a recipient who is registered under Division I of Chapter VIII of a continuous transmission commodity is a zero-rated supply if the recipient provides the supplier with a declaration in writing that

(1)  the recipient intends to ship the commodity outside Québec by means of a wire, pipeline or other conduit in the circumstances described in paragraphs 1 to 3 of section 191.3 in the case of natural gas, or paragraphs 2 to 4 of section 179 in any other case, or

(2)  the recipient intends to supply the commodity in the circumstances described in subparagraphs a to d of paragraph 1 of section 191.3.1.

The first paragraph applies provided that, if the recipient subsequently neither ships the commodity outside Québec in accordance with subparagraph 1 of the first paragraph nor supplies it in accordance with subparagraph 2 of the first paragraph, it is the case that the supplier did not know, and could not reasonably be expected to have known, at or before the latest time at which tax in respect of the particular supply would have become payable if the supply were not a zero-rated supply, that the recipient would neither so ship the commodity outside Québec nor so supply the commodity.

2001, c. 53, s. 310.

191.3.3. A supply made by a person to a recipient not resident in Québec who is not registered under Division I of Chapter VIII of a service of storing natural gas for a period, or of taking up surplus natural gas of the recipient for a period, and returning the gas to the recipient at the end of the period is a zero-rated supply if

(1)  at the end of the period, the gas is to be delivered to the recipient to be shipped outside Québec;

(2)  at the end of the period, where the gas is exported outside Canada, the recipient holds a valid licence or order for the shipment of the natural gas issued under the National Energy Board Act (Revised Statutes of Canada, 1985, chapter N-6); and

(3)  it is not the case that, at or before the latest time at which tax in respect of the supply would have become payable if the supply had not been a zero-rated supply, the person knew or could reasonably be expected to have known either that

(a)  the recipient would not ship the gas outside Québec as soon after the end of the period as is reasonable, having regard to the circumstances surrounding the shipment outside Québec and, where applicable, to the normal business practice of the recipient, or

(b)  the gas would not be shipped outside Québec

i.  in the same measure as was stored or taken up except for any loss due to its use by a carrier as fuel or compressor gas for transporting the gas by pipeline, and

ii.  in the same state except to the extent of any processing or alteration reasonably necessary or incidental to its transportation or necessary to recover natural gas liquids or ethane from the gas at a straddle plant.

2001, c. 53, s. 310.

191.3.4. A supply made by a supplier to a recipient not resident in Québec who is not registered under Division I of Chapter VIII of a service of taking up surplus electricity of the recipient for a period and returning the electricity to the recipient at the end of the period or of deferring delivery of electricity supplied to the recipient at the beginning of a period until the end of the period is a zero-rated supply if

(1)  the electricity is shipped outside Québec by the supplier or recipient

(a)  in the same measure and state except for any consumption or alteration reasonably necessary or incidental to its transportation, and

(b)  as soon after the end of the period as is reasonable having regard to the circumstances surrounding the shipment outside Québec and, where applicable, to the normal business practice of the shipper; and

(2)  at the end of the period, where the electricity is exported outside Canada, the requirement under the National Energy Board Act (Revised Statutes of Canada, 1985, chapter N-6), with respect to the holding of a valid licence, order or permit for the export of the electricity issued under that Act, is met.

2001, c. 53, s. 310.

191.4. A supply made to a person not resident in Québec of a custodial or nominee service in respect of securities or precious metals of the person is a zero-rated supply.

1994, c. 22, s. 455; 1997, c. 85, s. 523.

191.5. A supply made to a person not resident in Québec, other than an individual, who is not registered under Division I of Chapter VIII that consists in providing an individual not resident in Québec with, or in administering an examination in respect of, an educational service leading to a certificate, diploma, permit or similar document, or a class or rating in respect of a licence, that attests to the competence of the individual to whom the service is rendered or the examination is administered to practise a trade or vocation, is a zero-rated supply.

1994, c. 22, s. 455.

191.6. A supply made to a person not resident in Québe