Implementation, Place of Supply, Transition,
90/10 and ITC Reporting.
Acumin:
Providing the right tools for
a seamless transition.
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As everyone is now well aware, effective July 1st, 2010, several Canadian provinces (British Columbia and Ontario) have eliminated the provincial sales tax and implementing the harmonized sales tax (HST) system. We are now faced with provinces whose HST varies across Canada: (B.C. – 12%, Ontario - 13%, Nova Scotia – 15%. New Brunswick, Newfoundland and Labrador - 13%, Alberta, Manitoba, P.E.I., Quebec and Saskatawan and all Canadian territories will remain on the current GST 5% tax system.
The pending changes to the Canadian sales tax legislation system also includes new place of supply rules with exceptions, transitional rules for work in progress that straddles the cut-off date of July 1st, 2010 and ITC rules on specified property and services in Ontario and BC. This means that firms must apply the appropriate tax schemes for all matters. New legislation and compliance will include new reporting and sales tax audit support requirements (CRA Schedule B).
Therefore, commencing July 1st, 2010, law firm billing their clients located out of their base province may have to start billing for and collecting GST or HST based on place of new supply rules and subject to work-in-progress transitional rules.
These new requirements and transitional rules will have a major impact within some of the administrative processes for law firms in Canada, specifically British Columbia and/or Ontario. In addition law firm outside of British Columbia or Ontario may also be affected, depending on the amount of work executed subject to the new place of supply rules and/or transitional rules. For specific questions concerning compliance, transitional rules or other related questions, please consult your tax specialist or government body.
Dexco has made enhancements to Acumin which will automate and enable end-user functionality. Acumin's design will assist firms to comply with all new the HST requirements while maintaining client-reporting clarity, data integrity and optimum user workflows.
Acumin's HST Option includes:
For further details, please contact one of Dexco's Client Engineers for the various options available which can make the transition simple yet fully compliant.
Dexco Corporation
Tel: 1-800-349-7371 ext 634
Links and Reference Material
Automatic tax scheme recommendation in consideration of the current "Place of Supply" rules,