Provincial Sales Tax Act, Part 11 - Recovery of Amounts Owing

Section 216 – Collection Bond

PST - SEC.216/Int.

References:

Act: Section 1 "director", "month", "registrant"; Section 168; Section 173

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Interpretation (Issued: 2013/12; Revised: 2017/05)

Effective May 19, 2016, Bill 14, Finance Statutes Amendment Act, 2016 amended subsection 216(3) to clarify that a bond may be applied to other amounts that are required to be remitted to government, such as amounts collected as if they were tax.

Effective March 25, 2015, Bill 13, Finance Statutes Amendment Act, 2015 amends section 216 to provide that if there is a change in circumstances after a bond has been provided, the director may vary the required amount of the bond to an amount not greater than the maximum provided for in the section.

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 216 that the director may require an applicant, as defined in section 168, or a registrant to deposit a bond with the director, the amount of which is determined by the director.

Section 217 – Court Proceeding To Recover Amount Owing

PST - SEC.217/Int.

References:

Act: Section 224

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Interpretation (Issued: 2013/12)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 217 that the government may commence a proceeding in a court of competent jurisdiction to recover an amount owing to the government under the Act as a debt due to the government.

Section 218 – Summary Proceedings

PST - SEC.218/Int.

References:

Act: Section 1 "director"; Section 207

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Interpretation (Issued: 2013/12; Revised: 2016/01)

Effective March 25, 2015, Bill 13, Finance Statutes Amendment Act, 2015 amends section 218 by clarifying that all proceedings may be taken on a certificate issued and filed by the director under the section as if it were a judgment of the court in favour of the government.

Treating the certificate as if it were a judgement of the court extends the limitation period for the recovery of the amounts in the certificate from 2 years to 10 years as set out in the Limitation Act.

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 218 that if a person fails to pay or remit an amount owing to the government under the Act, the director may issue a certificate (commonly referred to as a Certificate of Judgment) specifying the amount owed and the name of the person who owes it. Section 218 also provides for administrative procedures related to the issuance, filing and enforceability of certificates.

Section 219 – Alternative Remedies

PST - SEC.219/Int.

References:

Bulletin GEN 001

Interpretation (Issued: 2013/12)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 219 the following regarding the recovery of amounts owing under the Act.

Subsection 219(1) provides that remedies available to the government for the recovery of an amount owing to the government under the Act may be exercised separately, concurrently or cumulatively.

Subsection 219(2) provides that the liability of a person for the payment of an amount owing to the government under the Act is not affected by a fine or penalty imposed on or paid by the person for contravention of the Act.

Section 220 – Attachment Of Funds

PST - SEC.220/Int.

References:

Act: Section 1 "director"

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Interpretation (Issued: 2013/12)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 220 the following regarding the issuance of a demand by the director as a collection remedy for the recovery of amounts owing under the Act.

Subsection 220(1) provides that in section 220, "taxpayer" means any person who is liable to pay or remit to the government an amount under the Act.

Subsection 220(2) provides that if the director knows or suspects that a person is or is about to become indebted or liable to make a payment to a taxpayer, the director may demand that that person pay to the government on account of the taxpayer's liability under the Act all or part of the money otherwise payable to the taxpayer.

Subsection 220(3) provides that without limiting subsection 220(2), if the director knows or suspects that a person is about to advance money to or make a payment on behalf of a taxpayer, or make a payment in respect of a negotiable instrument issued by a taxpayer, the director may demand that that person pay to the government on account of the taxpayer's liability under the Act the money that would otherwise be advanced or paid.

Subsection 220(4) provides that a demand under section 220 may be served by personal service, registered mail, electronic mail or fax.

Subsection 220(5) provides that if under section 220 the director demands that a person pay to the government, on account of a taxpayer's liability under the Act, money otherwise payable by that person to the taxpayer as interest, rent, remuneration, a dividend, an annuity or other periodic payment, the demand

(a) is applicable to all of those payments to be made by the person to the taxpayer until the liability under the Act is satisfied, and

(b) operates to require payments to the government out of each payment of the amount stipulated by the director in the demand.

Subsection 220(6) provides that money or a beneficial interest in money in a savings institution

(a) on deposit to the credit of a taxpayer at the time a demand is served, or

(b) deposited to the credit of a taxpayer after a demand is served

is money for which the savings institution is indebted to the taxpayer within the meaning of section 220, but money on deposit or deposited to the credit of a taxpayer as described in paragraph 220(6)(a) or paragraph 220(6)(b) does not include money on deposit or deposited to the credit of a taxpayer in the taxpayer's capacity as a trustee.

Subsection 220(7) provides that a demand under section 220 continues in effect until the earliest of the following:

(a) subject to paragraphs 220(7)(b) and 220(7)(c), the demand is satisfied;

(b) subject to paragraph 220(7)(c), 90 days after the demand is served;

(c) three years after the demand is served, if the demand is made in respect of an outstanding legal claim or insurance claim that, if resolved in the taxpayer's favour, will result in money becoming available to the taxpayer.

Subsection 220(8) provides that despite subsection 220(7), if a demand is made in respect of a periodic payment referred to in subsection 220(5), the demand continues in effect until it is satisfied unless no periodic payment is made or is liable to be made within 90 days after the demand is served, in which case the demand ceases to have effect at the end of that period.

Subsection 220(9) provides that money demanded from a person by the director under section 220 becomes payable

(a) as soon as the person is served with the demand, if that person is indebted or liable to make a payment to the taxpayer at the time the demand is served, or

(b) as soon as the person becomes indebted or liable to make a payment to the taxpayer, in any other case.

Subsection 220(10) provides that a person who fails to comply with a demand under subsection 220(2) or subsection 220(5) is liable to pay to the government an amount equal to the amount that the person was required to pay under subsection 220(2) or 220(5).

Subsection 220(11) provides that a person who fails to comply with a demand under subsection 220(3) is liable to pay to the government an amount equal to the lesser of

(a) the total of the money advanced or paid, and

(b) the amount that the person was required to pay under subsection 220(3).

Subsection 220(12) provides that money paid by any person to the government in compliance with a demand under section 220

(a) satisfies the original liability to the extent of the payment, and

(b) is deemed to have been paid by that person to the taxpayer.

Section 221 – Lien

PST - SEC.221/Int.

References:

Act: Section 1 "director", "related individual"; Section 211; Section 222; Section 228

PSTR: Section 102

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Interpretation (Issued: 2013/12; Revised: 2016/01)

Effective March 25, 2015, Bill 13, Finance Statutes Amendment Act, 2015 amends section 221 by clarifying that the lien established under the section applies in relation to all amounts owing under the Act, including amounts owing in relation to stand alone penalties for the failure to register.

Effective April 1, 2013, Bill 8 - Budget Measures Implementation Act, 2014 amended subsection 221(7) by changing the wording so that it is clear that it is the taxes that were required to be collected and not the penalty or interest.

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 221 that liens may be registered against a person’s real property and personal property as a collection remedy for the recovery of amounts owing under the Act.

Section 222 – Responsibility Of Person Having Control Of Property

PST - SEC.222/Int.

References:

Act: Section 1 "director", "tax"; Section 199; Section 221; Section 246

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Interpretation (Issued: 2013/12; Revised: 2016/01)

Effective June 9, 2015, Bill 13, Finance Statutes Amendment Act, 2015 amends section 222 by adding a rule that the amount owing under subsection (4) by a person, other than a registrant, must be paid on or before the last day of the month after the month in which the disposition occurred.

The amendment also adds a new subsection (6) that provides that the amount owing by a registrant must be paid on or before the prescribed date and in the prescribed manner.

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 222 the requirement for a specified person, prior to distributing proceeds from the sale or realization of property on which control or possession was taken from a person who had a lien on the property under section 221, to obtain from the director a certificate indicating the amount of the lien has been paid.

Section 223 – Notice Of Enforcement Proceedings

PST - SEC.223/Int.

References:

Act: Section 1 "director"

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Interpretation (Issued: 2013/12)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 223 the requirement for the director to give a person who owes an amount under the Act notice of the director's intention to enforce payment before taking proceedings for the recovery of that amount.

Subsection 223(1) provides that before taking proceedings for the recovery of an amount owing to the government under the Act, the director must give to the person who owes the amount notice of the director's intention to enforce payment.

Subsection 223(2) provides that failure to give notice under subsection 223(1) does not affect the validity of proceedings taken for the recovery of an amount owing to the government under the Act.

Section 224 – Limitation Period

PST - SEC.224/Int.

References:

Act: Section 1 "assessment"; Section 217; Section 218; Section 220; Section 221

Bulletin GEN 001

Interpretation (Issued: 2013/12)

Effective June 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 amended section 224 by repealing subsection 224(4) and adding subsections 224(4) to 224(8).

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 224 the limitation period for collection remedies provided for under the Act. Note: the government also has the common law remedies as a creditor.

Subsection 224(1) provides that in section 224, "collection proceeding" means

(a) a proceeding for the recovery of an amount owing to the government under section 217 [court proceeding to recover amount owing],

(b) the filing of a certificate under section 218 [summary proceedings],

(c) the making of a demand under section 220 [attachment of funds], and

(d) the registration or enforcement of a lien under section 221 [lien].

Subsection 224(2) provides that a collection proceeding may be commenced at any time within 7 years after the date of the notice of assessment for the amount claimed in the collection proceeding.

Subsection 224(3) provides that despite subsection 224(2), a collection proceeding that relates to a contravention of the Act or the regulations and that involves wilful default or fraud may be commenced at any time.

Subsection 224(4) provides that if, before the expiry of the limitation period that applies under subsection 224(2) to an amount claimed, a person acknowledges liability in respect of the amount claimed, the date of the notice of assessment is deemed to be the day on which the acknowledgement is made.

Subsection 224(5) provides that subsection 224(4) does not apply to an acknowledgment, other than an acknowledgement referred to in subsection 224(6), unless the acknowledgment is

(a) in writing,

(b) signed, by hand or by electronic signature within the meaning of the Electronic Transactions Act,

(c) made by the person making the acknowledgment or the person's agent, and

(d) made to the government or an agent of the government.

Subsection 224(6) provides that in the case of an amount claimed to which the limitation period under subsection 224(2) applies, for the purposes of subsection 224(4), part payment of the amount by the person against whom the claim is or may be made or by the person's agent is an acknowledgment by the person against whom the claim is or may be made of liability in respect of the claim.

Subsection 224(7) provides that subsections 24(2), 24(4) and 24(10) of the Limitation Act applies for the purposes of section 224.

Subsection 224(8) provides that the liability of a person for the payment of an amount owing to the government under the Act is not affected by the expiry of the limitation period that applies under subsection 224(2) to the amount claimed.

Section 225 – Application For Injunction

PST - SEC.225/Int.

References:

Act: Section 1 "director", "lease", "software", "taxable service"

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Interpretation (Issued: 2013/12)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 225 that the director may apply to the Supreme Court for an injunction ordering a person to cease selling, offering to sell, providing or offering to provide tangible personal property, software or a taxable service or leasing or offering to lease tangible personal property until the person complies with the Act and the regulations and the person's obligations under the Act are fulfilled.