The Tax Court of Canada (“TCC”) issued a ruling in CFI Funding Trust v. The Queen,[1] respecting documentary requirements under s.169(4) of the Excise Tax Act (Canada) (the “ETA”),[2] a provision outlining the form requirements for input tax credits (“ITCs”). The TCC ruled that supporting documents need to be issued or signed by the supplier applying for ITCs.
The TCC held that supporting documents need only be issued or signed by the supplier when they do not fit within the categories of documents listed in paragraphs (a) to (g) of the Input Tax Credit Information (GST/HST) Regulations (Canada) (the “Regulations”). Given that jurisprudence relating to the ETA often informs Courts’ reasoning in customs cases, the ruling in this case is likely to have implications for how similar issues are resolved in the context of customs law.
The case
Counsel for the Respondent asserted that paragraph 2(h) of the Regulations which states, in part, “any other document validly issued or signed by a registrant,” should be interpreted to mean that documents which are neither issued nor signed by the originator do not qualify as supporting documents for the purposes of s.169(4) of the ETA. CFI Funding Trust advanced the opposite view and argued that only documents which do not fall within the non-exhaustive list of accepted forms in paragraphs 2(a) to (g) of the Regulations need to be issued or signed by a registrant to be considered valid supporting documentation.
In its decision, the TCC ultimately agreed with CFI Funding Trust’s arguments and endorsed a broad interpretation of s.169(4), holding that the provision merely requires supporting documentation to be in a form which contains the prescribed information set out in s.3 of the Regulations. In other words, registrants may provide supporting documentation in any form, so long as it contains the required prescribed information. For example, the prescribed information for CFI Funding Trust’s ITC claims included the name of the supplier, the terms of payment and the total amount paid for all of the supplies.[3] The TCC also confirmed that there are no limits as to how such prescribed information is obtained.[4] The necessary prescribed information may be received by the registrant via oral or electronic communication, in foundational documents or other sources, and it need not be confined to a single document.[5]
Consequently, the TCC determined that the language in both s.169(4) of the ETA and s.2 of the Regulations was intended by Parliament to be broad so as to facilitate the acceptance of a wide range of forms, especially electronic or paperless documents, as valid supporting documentation for the purpose of ITC claims.[6]
Implications for interpretation of the Customs Act (Canada)
The TCC’s endorsement of a broad interpretative approach to s.169(4) of the ETA in CFI Funding Trust may lead other Courts to adopt a similarly broad approach in dealing with related areas of law, namely customs. Indeed, what qualifies as sufficient information under the Customs Act (Canada) has traditionally been interpreted broadly and in a manner consistent with the ETA. The decision in CFI Funding Trust is not likely to disrupt this tradition. Questions as to what qualifies as “sufficient information”[7] in s.45 of the Customs Act (Canada) are likely to be resolved with reference to the same broad standard used in CFI Funding Trust.
Should you have any questions, please reach out to a member of Miller Thomson’s Global Trade and Customs group.
The authors would like to thank Lara Jung, 2023 Miller Thomson Summer Law Student, for her contributions to this article.
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[1] CFI Funding Trust v. The Queen, 2022 TCC 60, 2022 CCI 60, 2022 CarswellNat 1944, 2022 CarswellNat 5339, [2022] G.S.T.C. 40, 2022 D.T.C. 1043, 2022 A.C.W.S. 1806.
[2] Excise Tax Act (RSC 1985, c E-15).
[3] See para. 50.
[4] See para. 41.
[5] See para. 41 – 45.
[6] See para. 38.
[7] Section 45 of the Customs Act defines “sufficient information” broadly to mean as follows: “in respect of the determination of any amount, difference or adjustment, means objective and quantifiable information that establishes the accuracy of the amount, difference or adjustment;”.
