Have you applied for designation as a municipality? Do not forget that you can get 100% of the GST as well as 57.14% of your PST for the subsidized units in your project! Contact our office if you have misplaced the application particulars or visit our web site in the Member Services section to download the necessary information.
We want to make sure it is clear that the Municipal Designation entitles non-profit and co-op projects to a sales tax rebate on expenses related to units whose tenants pay rent-geared –to-income (RGI).
This refers to:
Your project auditor and Portfolio Management Officer can advise you on this.
Subject: GENERAL INFORMATION LETTER This information applies to organizations that may be designated as 'municipalities' The Minister of National Revenue may designate an organization to be a municipality but Please note that this designation does not apply to any other activities that the An organization which has been designated to be a municipality may be entitled to the Application An organization may request municipal designation by applying, in writing, with Director Public Service Bodies and Governments Division Excise and GST/HST Rulings Directorate Canada Revenue Agency Ottawa ON K1AOL5 Supporting documentation The organization must provide documentation that supports that it meets the above- * A copy of the Certificate and Articles of Incorporation for the organization; * A copy of a dated and signed agreement that describes that the organization is * A copy of a document that attests to the number of rent-geared-to-income units for Effective date of designation Generally, a municipal designation for purposes of section 259 is effective the beginning Determination of eligible households We will also require documentation that supports that the selection of eligible households Entitlements and obligations Note that the ETA contains other provisions that set out conditions that apply to this ...II R350 F(99>
Municipal Designation
pursuant to subsection 259(1) of the Excise Tax Act (ETA) for the purpose of claiming
the municipal rebate.
only in respect of activities specified in the designation that involve the making of
supplies (other than taxable supplies) by the organization of municipal services. The
supply of long-term residential accommodation to tenants on a rent geared-to-income
basis by a non-profit organization (or a charity) that receives government funding to
assist it in providing this accommodation qualifies as a municipal service for designation
purposes. We consider the supply of long-term residential accommodation to mean the
rental of self-contained housing units (private living quarters which include cooking
facilities and a bathroom) for periods of one month or more. The government funding
must be payable to subsidize the cost of those housing units that are supplied on a rent
geared-to-income basis. Note that government funding in these situations includes
funding provided by a municipality. The activities described above must be undertaken
within a program to provide housing to low to moderate income households.
organization may be engaged in such as the supply of residential units that are not on a
rent geared-to-income basis or for which no subsidy is payable (sometimes referred to as
market rent) and the supply of commercial space. For purposes of municipal designation,
a supply that includes accommodation as one element but also includes other elements
such as meals, or personal care services, or laundry, or housecleaning may not be
considered an eligible supply of long term accommodation.
municipal rebate of 100 percent of the Goods and Services Tax (GST) and the federal
portion of the Harmonized Sales Tax (HST) paid on property and services acquired by it,
but only to the extent that the property or services acquired are intended for use,
consumption or supply in the course of the activities for which it has been designated.
supporting documents, to:
described criteria. These documents include:
providing rent-geared-to-income housing for which the organization receives funding
from a government, including a municipality; and,
which the organization receives funding from a government, including a municipality, .
relative to the total number of units in the project. This information is generally provided
to the funding source annually. We will require this information for at least the
latest/current year.
of the month in which the designation is approved. However, we may, on a case-by-case
basis, consider an effective date up to fouryears prior to this time. The organization must
request a retroactive effective date and support the reason for a retroactive application. In
addition, the organization must ensure that its supporting documentation demonstrates
that it met the above-described criteria during the prior period.
that benefit from the supply of long-term residential accommodation on a rent geared-lo-
income basis supported by government funding is within a program that is geared to low
to moderate income households. This may be demonstrated by policies, guidelines
and/or operating manuals that apply to the eligibility process.
rebate, including the calculation of amounts eligible for rebate and filing frequency. In
addition, entities that provide residential accommodation, as well as charities and
qualifying non-profit organizations may be eligible to claim other rebates. GST/HST
technical enquiries may be directed to a GST/HST Rulings Centre at 1-800-959-8287
(service in English) or 1-800-959-8296 (service in French)Sample Cover Letter
Date Director Public Service Bodies & Government Division Excise and GST/HST Rulings Directorate Canada Revenue Agency, Ottawa, ON K1AOL5 Dear Sir/Madame: We wish to apply for municipal designation under section 259 of the Excise Tax Act, ABC Non-Profit incorporated (insert date), is an (no. of units) unit non profit housing __ units - Interest Adjustment Date of September 1, 1987; - ___ units - Interest Adjustment Date of August 1, 1988; )These are examples Our organization provides rent-geared-to-income housing services to __ households Enclosed for your information are the following documents: 1) Articles of Incorporation; and 2) New Brunswick Housing Corporation Operating Agreement(s) Thank you for your attention. Should you require additional information, etc., please Yours truly, ABC Non-Profit Housing
retroactive to June 2000.
organization, developed as follows:
only!)
through agreements with the Province of New Brunswick.
contact the undersigned at 506-_________
Enclosures