• GST27 - Election or Revocation of an Election to Deem Certain Supplies to be Financial Services for GST/HST Purposes

General information

Who should complete this form?
Complete this form if your corporation is a member of a closely related group, of which at least one member is a listed financial institution, and you want to jointly elect or revoke an election with another member of the closely related group to have certain taxable supplies treated as supplies of financial services.

The listed financial institution does not have to be one of the members filing this election.

Note
Do not complete this form if you are a selected listed financial institution (SLFI) for QST purposes and want to jointly elect or revoke an election with another member of the closely related group to have certain taxable supplies treated as supplies of financial services for GST/HST and QST purposes. Instead, complete Form RC7227, Elections or Revocation of the Elections to Deem Certain Supplies to be Financial Services for GST/HST and QST Purposes for Selected Listed Financial Institutions. For more information, including the definition of an SLFI for GST/HST and/or QST purposes, go to www.cra.gc.ca/slfi.

What is the effect of this election?
Where this election is jointly made by two or more members of a closely related group, supplies of services and supplies of property by way of lease, licence, or similar arrangement are considered supplies of financial services. These supplies of financial services are exempt from the GST/HST. All other supplies retain their tax status regardless of the election.
This election does not apply to the following supplies:

• property held or services rendered by a member of a closely related group as a participant in a joint venture with another person while an election under section 273 of the Excise Tax Act (ETA) made jointly by the member and the other person is in effect;
• an imported taxable supply, as defined in section 217 of the ETA; or
• a supply of services in relation to the clearing or settlement of cheques and other payment items that are described in paragraph 150(2)(c) of the ETA.
  While this election is in effect, each electing member is considered to be a financial institution.

How do you make this election?
To make this election, you have to complete parts A, B, and C of this form and file it on or before the day which the GST/HST return for the reporting period that includes the effective date of the election, is required to be filed. This form is to be filed by the earliest date that a GST/HST return is due from the members who intend to make the election. For example, where Corporation X has a quarterly reporting period based on calendar quarters and Corporation Y is an annual filer on a calendar year basis, the election by the two corporations must be filed on or before April 30 of a particular year, that is, the due date of the return for Corporation X if it is to become effective on January 1 of that year.

How do you revoke this election?
To revoke this election, you have to complete parts A and C of this form. This election can be revoked if it has been in effect for at least 365 days. The revocation is effective on the day specified in Part C of this form.
Without a notice of revocation, an election ceases to be effective on the earliest of:

• the day an electing member ceases to be a member of the closely related group; or
• the first day the closely related group does not include a listed financial institution that is described in any of subparagraphs 149(1)(a)(i) to (x) of the ETA.
  
  Note
  When the election is in effect, each electing member is considered to be a financial institution described in subparagraph 149(1)(a)(xi) of the ETA. As a result, if a member is considered to be a financial institution only by virtue of the election, it will not be considered to be a financial institution for the purpose of determining when an election is no longer in effect.
  
  When an election made jointly by two members ceases to be in effect, the members cannot make another election without the written authorization of the Minister.

Definition
Closely related group – means a group of corporations each member of which is a registrant resident in Canada and is closely related, within the meaning in section 128 of the ETA, to each other member of the group.

Note
For purposes of this definition, a non-resident insurer that has a permanent establishment in Canada is deemed to be resident in Canada.

Listed financial institution – includes a bank, a corporation that is authorized under the laws of Canada or a province to carry on in Canada the business of offering to the public its services as a trustee, a person whose principal business is as a trader or dealer in, or as a broker or salesperson of, financial instruments or money, a credit union, an insurer, a segregated fund of an insurer, the Canada Deposit Insurance Corporation, a person whose principal business is the lending of money, an investment plan, a tax discounter, or a corporation that is considered to be a financial institution because it has an election in effect to have certain supplies deemed to be exempt financial services. For more information, see GST/HST Memorandum 17.6, Definition of “Listed Financial Institution”.

Where do you send this form?
Send this completed form and any attachments (if applicable) to your tax services office (TSO). To get the address of your TSO, go to www.cra.gc.ca/tso or call 1-800-959-5525.

What if you need help?
For more information, see GST/HST Memorandum 17.14, Election for Exempt Supplies, or call 1-800-959-8287.
To get our forms and publications, go to www.cra.gc.ca/gsthstpub or call 1-800-959-5525.