PWC, "GST/HST and QST alert: Investment plans are required to obtain investor percentages – action required by October 15, 2019", PwC Tax Insights, September 03, 2019, Issue 2019-31

Summary Under
Tax Topics - Excise Tax Act - Regulations - Selected Listed Financial Institutions Attribution Method (GST/HST) Regulations - Section 52 - Subsection 52(10)
overview/qualified investors should be contacted

Qualifying investors

A qualifying investor is generally an investor that is an investment plan (but not a DIP) that holds less than $10,000,000 in units in the DIP (or, if the plan is a stratified investment plan, holds less than $10,000,000 in units in a series of the plan) and is:

  • a person that is not a qualifying small investment plan (QSIP) or a pension plan whose members reside almost exclusively in non-HST provinces for GST/HST purposes (or exclusively outside Quebec for QST purposes) or a private investment plan
  • a SLFI, or
  • a member of an affiliated group, the members of which together hold units with a total value of at least $10,000,000 or which includes a member that is a SLFI

Written requests are not required to be sent to qualifying investors. Rather, qualifying investors must voluntarily provide DIPs the required information by November 15, 2019. However, we recommend that qualifying investors be sent the requisite request to ensure full compliance.

Summary Under
Tax Topics - Excise Tax Act - Regulations - Selected Listed Financial Institutions Attribution Method (GST/HST) Regulations - Section 52 - Subsection 52(1) - Qualifying Investor
overview

Qualifying investors

A qualifying investor is generally an investor that is an investment plan (but not a DIP) that holds less than $10,000,000 in units in the DIP (or, if the plan is a stratified investment plan, holds less than $10,000,000 in units in a series of the plan) and is:

  • a person that is not a qualifying small investment plan (QSIP) or a pension plan whose members reside almost exclusively in non-HST provinces for GST/HST purposes (or exclusively outside Quebec for QST purposes) or a private investment plan
  • a SLFI, or
  • a member of an affiliated group, the members of which together hold units with a total value of at least $10,000,000 or which includes a member that is a SLFI
Summary Under
Tax Topics - Excise Tax Act - Regulations - Selected Listed Financial Institutions Attribution Method (GST/HST) Regulations - Section 52 - Subsection 52(4)
October 15 deadline under e.g. s. 30(1)(b)A4 -C(ii)

Timing

DIPs must know where their unitholders resided or their “investor percentages” by December 31 of the particular year; however, as there are relieving rules that can apply if the information request is sent by October 15, 2019, it is strongly recommended that the information request be sent by this date. The person receiving this request has 45 days to respond to it.

Summary Under
Tax Topics - Excise Tax Act - Regulations - Selected Listed Financial Institutions Attribution Method (GST/HST) Regulations - Section 48 - Subsection 48(1) - Paragraph 48(1)A(b) - Element 48(1)A(b)A6 - Subparagraph 48(1)A(b)A6(ii)
desirability of making reconciliation election

Current year election

Generally, DIPs determine their provincial attribution percentage based on the default attribution point (i.e. September 30, 2018 for the 2019 year) and they must know where their unitholders resided or their “investor percentages” by December 31 of the particular year. To the extent that a DIP did not know, by December 31, 2018, where its unitholders resided or its “investor percentages” at the default attribution point (i.e. September 30, 2018), we suggest that the DIP makes an election for 2019 that allows it to use September 30, 2019 as its attribution point for 2019 so that it can obtain the required information before December 31, 2019.