T-0.1 - Act respecting the Québec sales tax

Section 324.5.1 Disposition versions

2003-07-03

324.5.1. The rules set out in the second paragraph apply where

(1)  for the purpose of satisfying in whole or in part a debt or obligation owing by a person (in this section referred to as the “debtor”), a creditor exercises a right under an Act of the Legislature of Québec, another province, the Northwest Territories, the Yukon Territory, Nunavut, or of the Parliament of Canada or an agreement relating to a debt security to cause the supply of property (in this section referred to as the “first supply”);

(2)  the recipient of the first supply has paid an amount (in this section referred to as the “tax amount”) as or on account of tax with respect to that supply; and

(3)  under the Act or the agreement, the debtor has a right to redeem the property and the debtor exercises that right.

The rules to which the first paragraph refers are as follows:

(1)  the redemption of the property is deemed to be a supply of the property made by way of sale by the recipient of the first supply to the debtor for no consideration; and

(2)  where the property was redeemed from the recipient of the first supply and an amount has been reimbursed by the debtor to the creditor or that recipient on account of the tax amount,

(a)  except for the purposes of sections 320 to 324.6, the debtor is deemed not to have supplied the property to the creditor under section 320 or to have received a supply of the property at the time of the redemption,

(b)  the debtor is deemed, for the purposes of sections 400 to 402, to have paid tax in error at the time of the redemption equal to the amount so reimbursed,

(c)  where the tax amount has been included in determining a rebate or an input tax refund claimed by that recipient in an application or return, the amount of the rebate or the input tax refund shall be added in determining the net tax of that recipient for the reporting period in which the property was redeemed, and

(d)  the tax amount shall not be included in determining a rebate or an input tax refund claimed by that recipient in an application or a return filed after the redemption of the property.

1997, c. 85, s. 612; 2003, c. 2, s. 332.

1997-12-19

324.5.1. The rules set out in the second paragraph apply where

(1)  for the purpose of satisfying in whole or in part a debt or obligation owing by a person (in this section referred to as the “debtor”), a creditor exercises a right under an Act of the Legislature of Québec, another province, the Northwest Territories, the Yukon Territory, or of the Parliament of Canada or an agreement relating to a debt security to cause the supply of property (in this section referred to as the “first supply”);

(2)  the recipient of the first supply has paid an amount (in this section referred to as the “tax amount”) as or on account of tax with respect to that supply; and

(3)  under the Act or the agreement, the debtor has a right to redeem the property and the debtor exercises that right.

The rules to which the first paragraph refers are as follows:

(1)  the redemption of the property is deemed to be a supply of the property made by way of sale by the recipient of the first supply to the debtor for no consideration; and

(2)  where the property was redeemed from the recipient of the first supply and an amount has been reimbursed by the debtor to the creditor or that recipient on account of the tax amount,

(a)  except for the purposes of sections 320 to 324.6, the debtor is deemed not to have supplied the property to the creditor under section 320 or to have received a supply of the property at the time of the redemption,

(b)  the debtor is deemed, for the purposes of sections 400 to 402, to have paid tax in error at the time of the redemption equal to the amount so reimbursed,

(c)  where the tax amount has been included in determining a rebate or an input tax refund claimed by that recipient in an application or return, the amount of the rebate or the input tax refund shall be added in determining the net tax of that recipient for the reporting period in which the property was redeemed, and

(d)  the tax amount shall not be included in determining a rebate or an input tax refund claimed by that recipient in an application or a return filed after the redemption of the property.

1997, c. 85, s. 612.