Administrative Policy
Excise and GST/HST News, No. 104, July 2018
New home warranties generally taxable
Where a new home warranty is issued as a policy or contract of insurance by an insurer, it is usually a taxable supply for GST/HST purposes. A new home warranty is usually excluded from the definition of an insurance policy for GST/HST purposes as a warranty in respect of the quality, fitness, or performance of tangible property (the new home) where it is supplied to a person who is acquiring that property otherwise than for resale. …
As a result, if, for example, an insurer issues a new home warranty insurance policy to an individual who is buying the new home for his or her place of residence, the fee paid for the new home warranty by the home buyer would be consideration for a taxable supply.
Limited circumstances where new home warranty is exempt
There are certain situations where a new home warranty issued by an insurer as a policy or contract of insurance will be included in the definition of insurance policy …:
- where it is issued to a person who is buying the new home to resell it; and
- where it is issued to a person who is not buying a new home from a builder, but who is acquiring services of constructing a new home on land owned by the person.
Uncategorical taxability of new home warranties issued by non-insurers
Where a new home warranty is issued by a person other than an insurer it will, regardless of who it is issued to, not be included in the definition of insurance policy … .
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Excise Tax Act - Section 154 - Subsection 154(2) | GST on B.C. sales tax applicable to sales of expensive autos | 259 |
| Tax Topics - Excise Tax Act - Regulations - Taxes, Duties and Fees (GST/HST) Regulations - Section 3 - Paragraph 3(b) | 74 | |
| Tax Topics - Excise Tax Act - Schedules - Schedule VI - Part II - Section 33 | qualifying service animals | 176 |