Guide to Collecting and Paying Federal and Provincial Sales Taxes

The purpose of this guide is to support departments in clarifying their role in relation to the Goods and Services Tax / Harmonized Sales Tax (GST/HST), Quebec sales tax (QST), provincial sales tax (PST) and Provincial Tax and Fee (PTF), where applicable under the relevant legislation, when departments are: charging, collecting and remitting taxes on the sale of taxable supplies of property or services and/or paying taxes on their purchases of taxable supplies of property or services.
Date modified: 2020-05-04

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Glossary

accountable advance (avance comptable)

Refers to:

  1. A sum of money advanced to a person from an appropriation; and
  2. A sum of money advanced to a person from the sum of money described in paragraph a) for which the person is accountable and includes imprest funds and working capital advances administered under an imprest system. [Accountable Advances Regulations, section 2]
acquisition card (carte d'achat)
A credit card issued under a contract between card issuers and the Government of Canada for the procurement and the payment of goods and services that are authorized official government business transactions.
advance payment (paiement anticipé)
A payment made by or on behalf of Her Majesty before the work, delivery of the goods, or rendering of the service has been completed.
appropriation (crédit)
Any authority of Parliament to pay money out of the Consolidated Revenue Fund. [Financial Administration Act, section 2]
assignor (cédant)
An entity to whom a debt is owed or will be owed by the Crown who wishes to transfer the said debt to another party.
authorized government travel expenses (dépenses de voyage du gouvernement autorisées)
Government travel-related charges or cash withdrawals made by the cardholder or authorized person against a travel card or account issued in the name of an individual or a department and in accordance with the requirements and policies issued by the Treasury Board and the appropriate department.
cardholder (détenteur de carte)

In the case of an acquisition card, an employee who is identified by the responsibility centre manager to be issued an acquisition card in his or her name, or, when an employee is assigned an acquisition card for the purpose of acquiring goods or services on behalf of an organizational asset named on the card.

In the case of a travel card, an individual named on the card who is authorized to receive and use the individual designated travel card or departmental travel expense card in accordance with the requirements of this directive and other policy instruments issued by Treasury Board and the individual's department.

change fund (fonds d'appoint)
The cash provided to a cashier or other individual for the purpose of making change. [Accountable Advances Regulations, section 2]
claim (réclamation)
A request for compensation to cover losses, expenditures or damages sustained by the Crown or a claimant.
class of recipient (catégorie de bénéficiaires)
Includes persons, organizations, or both (e.g., corporations, other governments) that meet the established eligibility criteria of an approved program.
convenience cheques (chèque de dépannage)
A cheque provided by the credit card issuer and drawn on an acquisition card.
critical financial risk (risque financier majeur)
An event with reasonable probability that a significant unfunded financial obligation may arise, the department may be unable to fulfill its mandate, or that the event may cause significant damage to the reputation of the Government of Canada. The identification of a critical financial risk depends on the department's operating environment and management's professional judgment.
Crown servant (fonctionnaire de l'État)
  • An individual employed (or formerly employed) in a department as defined in section 2 of the Financial Administration Act and to other portions of the federal public administration named in Schedule IV of the Financial Administration Act, in the Canadian Forces and the Royal Canadian Mounted Police;
  • An individual appointed (or formerly appointed) by the Governor in Council or by the Treasury Board or by a minister, except for former and serving directors or officers of Crown corporations;
  • A former and serving prime minister, lieutenant-governor, governor general, minister, deputy head and ministers' exempt staff;
  • A representative authorized in writing to act on behalf of a serving prime minister, minister or deputy head;
  • An incoming participant or former incoming participant in a program under the Policy on Interchange Canada; or
  • An estate of an individual mentioned above.
departmental travel card coordinator (coordonnateur ministériel des cartes de voyage)
A departmental official who represents a department in all matters related to its participation in the travel card program and who is responsible for acting as the liaison between Public Services and Procurement Canada and the card issuer.
departmental travel expense card (carte ministérielle de frais de voyage)

Comprises the following:

  • An account used to purchase common carrier transportation that is arranged through a government-approved supplier (no card is issued). The account is also used for travel service transaction fees; and
  • A credit card issued in the name of an authorized individual within a responsibility centre that is to be used for authorized government travel expenses by public servants, non-public servants or other persons.
designated personnel (personnel désigné)
Ministers, ministers of state, parliamentary secretaries, and ministers' exempt staff who may be issued a travel expense card to pay for authorized government travel. Designated personnel do not include members of Parliament, non-public servants, students, consultants or Interchange Canada participants.
drawdown (prélèvement)
The process whereby funds, approved by Parliament through an appropriation, are paid from the Consoldiated Revenue Fund to a Crown corporation to cover its expenditures.
ex gratia payment (paiement à titre gracieux)
A benevolent payment made by the Crown used only when there is no other statutory, regulatory or policy vehicle to make such a payment. The payment is made in the public interest for loss or expenditure incurred where the Crown has no obligation of any kind or has no legal liability, or where the claimant has no right of payment or is not entitled to relief in any form.
excluded group employees (employés de groupes exclus)
Positions identified by the employer, in accordance with the Public Service Labour Relations Act, as not being represented by a bargaining agent because of the nature of the duties of those positions.
financial authorities (pouvoirs financiers)

Includes:

financial management (gestion financière)
A continuum of finance-related activities undertaken to ensure sound and prudent use of public funds in an effective, efficient and economical manner.
financial management system (FMS) (système de gestion financière (SGF))
Any combination of business processes (end-to-end, automated and manual), procedures, controls, data and software applications, all of which are categorized as either program systems or central systems, that produces financial information and related non-financial information.
financial plan (plan financier ministériel)
A multi-year plan providing the basis for identifying the elements of the work and priorities to be delivered to achieve a department's mandate and programs. A financial plan supports the development of the in-year departmental budget and related allocations of resources.
financial reporting (rapport financier)
Internal and external financial reports and disclosures. Internal financial reporting can include financial information that supports decision making, risk assessment, planning, budgeting, resource allocations, accounting, performance assessments and reports. External reporting includes all financial statements, reports or disclosures, including those prepared for Parliament or designed to be made public.
forgiveness (renonciation)
The deletion of a debt related to a non-budgetary expenditure that extinguishes the debt, waives the right of Her Majesty to reinstate the debt, and permits both the Crown and the debtor to remove the debt from their accounts.
Goods and Services Tax Refundable Advance Account (GST RAA) (Compte des avances remboursables de la TPS (CAR TPS))
Statutory advance account used by departments to record all Goods and Services Tax and Harmonized Sales Tax payable on purchases of goods and services from external parties.
government travel (voyage du gouvernement)
All travel authorized by the employer. The term is used to refer to the circumstances under which the expenses prescribed in the National Joint Council Travel Directive and other relevant travel requirements may be paid or reimbursed from public funds.
holder or custodian (détenteur ou dépositaire)
The individual to whom an accountable advance has been issued or who is responsible for the advance.
imprest bank account (compte bancaire d'avance fixe)
A bank account located in a foreign country set up by the Receiver General for Canada in the name of a department, and funded through an advance issued in compliance with the Accountable Advances Regulations. Departments may make restricted deposits to and issue cheques from this account.
individual designated travel card (carte individuelle de voyage)
A credit card issued to government employees and designated personnel that may be used to pay for authorized government travel expenses.
internal control over financial management (contrôle interne en matière de gestion financière)
A set of measures and activities that provide reasonable assurance of the effectiveness and efficiency of the financial management activities of the department.
internal control over financial reporting (contrôle interne en matière de rapports financiers)
A subset of the system of internal control over financial management. Internal control over financial reporting is a set of measures and activities that allow senior management and users of financial statements to have reasonable assurance of the accuracy and completeness of the department's financial statements.
loan (prêt)
A financial asset of the government represented by a promise by a borrower to repay a specific amount, at a specified time or times, or on demand, usually with interest.
loan guarantee (garantie d'emprunt)
A promise that the government will repay a lender (e.g., a bank or other financial institution providing credit or funding to another party) the amount guaranteed, subject to the terms and conditions of an agreement, if the borrower defaults. The guarantee will reduce the lender's risk and should enable the borrower to obtain a loan at a lower interest rate or obtain a loan that might not otherwise have been obtainable.
organizational asset (actif organisationnel)
A high-value mobile asset (excluding motor vehicles), such as a vessel (e.g., ship) or aircraft, that requires frequent large dollar transactions to support its operation.
petty cash fund (petite caisse)
Cash kept on hand under an imprest system for the purpose of making small payments in cash. [Accountable Advances Regulations, section 2]
provincial tax or fee (PTF) (taxe ou droit provincial)

Any tax or fee, other than the provincial sales tax, described as follows:

  1. Any tax of general application payable on a value, price or quantity basis by a purchaser, lessee, user or consumer of tangible personal property or services subject to the tax in respect of the sale, rental, consumption or use of the property or services, except to the extent that the tax is payable in respect of property or services acquired for resale, lease or sublease;
  2. Any fee of general application payable by an owner, user or lessee of any vehicle or item of mobile equipment drawn, propelled or driven by any kind of power in respect of the registration of the vehicle or item or the licensing or certification thereof or in respect of the transfer or renewal of any registration permit, licence or certificate issued for the use of the vehicle or item; and
  3. Any tax of a like nature to a tax described in paragraph (a) or any fee of a like nature to a fee described in paragraph (b) that is from time to time prescribed.
public money (fonds publics)

All money belonging to Canada received and collected by the Receiver General or any other public officer in his or her official capacity or any person authorized to receive or collect such money. Public money includes the following:

  • Duties and revenues of Canada;
  • Money borrowed by Canada or received through the issue or sale of securities;
  • Money received or collected for or on behalf of Canada; and
  • All money that is paid to or received or collected by a public officer under or pursuant to any act, trust, treaty, undertaking or contract, and is to be disbursed for a purpose specified in or pursuant to that act, trust, treaty, undertaking or contract. [Financial Administration Act, section 2]
public property (biens publics)
All property (including data), other than money, belonging to Her Majesty in right of Canada. [Financial Administration Act, section 2]
receivables (comptes débiteurs)
Financial claims incurred through the tax system or arising from accrued revenues transactions, expenses overpayments and other recoverable payments that will result in a future inflow of cash.
reciprocal taxation agreement (RTA) (accord de réciprocité fiscale (ARF))

An agreement between the federal government and the government of any province or territory that provides, without restricting the generality of the foregoing, for all or any of the following matters:

  1. The payment by Her Majesty in right of Canada of any provincial tax or fee imposed or levied under a law of that province that would be payable by Her Majesty in right of Canada if that law were applicable thereto;
  2. The payment by Her Majesty in right of that province of any tax or fee imposed or levied under the Excise Tax Act that is payable by Her Majesty in right of that province and the waiver of the right to a payment in respect of that tax or fee provided in subsections 68.14 or 68.19 of that Act;
  3. The payment by Her Majesty in right of Canada to that province or the assignees of that province of amounts determined under the agreement in respect of amounts paid by Her Majesty in right of that province and amounts paid by persons identified in the agreement as or on account of any tax imposed under the Excise Tax Act;
  4. The payment by Her Majesty in right of Canada of interest on any amount equal to any provincial tax or fee imposed or levied under a law of the province that would be collected by Her Majesty in right of Canada if that law were applicable to Her Majesty in right of Canada where those amounts have not been remitted or paid to the province at the rate and in the manner and at the time provided for in the applicable law of the province; and
  5. The collection and the remittance by Her Majesty in right of Canada of any provincial tax or fee imposed or levied under a law of the province that would be collected pursuant to that law by Her Majesty in right of Canada if that law were applicable to Her Majesty in right of Canada.
remission (remise)
The deletion of a debt related to a budgetary expenditure that involves the cancellation of or release from an otherwise enforceable debt, tax, fee or penalty.
security deposit (dépôt de garantie)

Includes:

  • A bill of exchange that is payable to the Receiver General and certified by an approved financial institution or drawn by an approved financial institution on itself;
  • A government guaranteed bond; or
  • Such other security as may be deemed appropriate by the contracting authority and approved by the Treasury Board. [Government Contracts Regulations, section 2]
self-sustaining corporation (société financièrement autonome)
A Crown corporation that is judged to be able to finance its operations and capital programs from internally generated funds and from funds that it could raise in the capital markets on its own credit.
senior departmental managers (cadres supérieurs du ministère)
For the purposes of the Policy on Financial Management, senior departmental managers are typically departmental managers who report directly to a deputy head and are accountable for effective financial management within their areas of responsibility.
set-off (compensation)
The reduction of a claim by deducting the amount of a valid compensating claim. A set-off by the federal government may be enacted by a specific statute or regulation or under the authority of section 155 of the Financial Administration Act.
standing advance (avance permanente)
An accountable advance issued in a specified amount for an indeterminate period and replenished to that specific amount each time an accounting for expenditures is made. [Accountable Advances Regulations, section 2]
waiver (dispense)
A form of debt deletion involving only the interest and/or administrative charges related to a debt and done in accordance with sections 9 and 12 of the Interest and Administrative Charges Regulations.
write-off (radiation)
An accounting action that reduces the amount of accounts receivable of a department or agency regarding a debt, or a part of a debt, that has been determined to be uncollectible. It does not forgive the debt or release the debtor from the obligation to pay; neither does it affect the right of the Crown to enforce collection in the future.
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