Taxation of Services (Accounting, Architectural, Engineering, Geoscientific, Legal, Private Investigation, Security and Security Monitoring) Regulation

Taxation of Services (Accounting, Architectural, Engineering, Geoscientific, Legal, Private Investigation, Security and Security Monitoring) Regulation, M.R. 22/2005 The Retail Sales Tax Act , C.C.S.M. c. R130 Regulation 22/2005 Registered February 8, 2005 bilingual version (HTML) Table of Contents Section INTERPRETATION 1 Definitions and interpretation 2 Definitions of taxable services 3 When taxable service relates to Manitoba EXEMPTIONS 4 Services exempt in certain circumstances 5 Exempt services 6 Partial exemption — services relating partly to Manitoba 7 Exempt disbursements 8 Taxable portion — architectural services 9 Taxable portion — geoscientific or engineering services COMING INTO FORCE 10 Coming into force INTERPRETATION Definitions 1(1) The following definitions apply in this regulation. "Act" means The Retail Sales Tax Act . («  Loi  ») "estate planning advice" means advice relating to the future disposition of the estate of a person. (« conseils en matière de planification successorale ») "person" includes a partnership. (« personne ») "purchaser" means a person who commands or receives a taxable service referred to in clause 4(1)⁠(i) of the Act. (« acheteur ») "specified estate planning document" means (a) a will; (b) a directive as defined in The Health Care Directives Act ; or (c) a power of attorney prepared in conjunction with the preparation of a will or a directive mentioned in clause (b). (« document de planification successorale prescrit ») "tax" means, depending on the context, (a) tax payable under the Act; or (b) tax payable under any federal, provincial or municipal law. (« taxe ») "tax planning advice" means advice regarding the tax implications of (a) a contemplated transaction or event, or series of transactions or events; or (b) a contemplated business activity or organizational structure. (« conseils en matière de planification fiscale ») Carrying on business in Manitoba 1(2) For the purpose of this regulation, a person is deemed to be carrying on business in Manitoba if an employee or other representative of the person carries on activities in Manitoba on the person's behalf for the purpose of providing, or promoting the sale or use of, the person's property or services. M.R. 143/2019 Definitions of taxable services 2 The following definitions apply in this regulation and in clause 4(1)⁠(i) of the Act. "accounting services" includes services in the nature of (a) services under an audit, review or compilation engagement; (b) preparing or verifying financial statements; (c) investigating accounting records; (d) bookkeeping services; (e) preparing or processing a payroll, including calculating and remitting amounts deducted from gross remuneration; (f) preparing or filing an application or return that includes financial information; (g) preparing or filing a return or other document for tax purposes; (h) providing tax planning advice or estate planning advice in conjunction with the preparation or review of (i) a return or other document for tax purposes, or (ii) a document that is intended to be legally binding; (i) providing advice or assistance to, or representing, a person in relation to (i) a tax audit or investigation, (ii) an actual or proposed estimate, assessment or reassessment of tax, (iii) a tax refund, or (iv) a tax appeal; (j) research related to the provision of accounting services; (k) secretarial or other administrative services related to the provision of accounting services; (l) consulting services provided in conjunction with accounting services; or (m) inventory counting services. (« services de comptables ») "architectural services" means services that (a) are provided under the authority of The Architects Act ; and (b) are provided in any of the following phases of a project, as described in chapter 2.1.10 of the Canadian Handbook of Practice for Architects : (i) schematic design, (ii) design development, (iii) preparation of construction documents, (iv) bidding or negotiating for a construction contract. (« services d'architectes ») "geoscientific or engineering services" means services that (a) are provided under the authority of The Engineering and Geoscientific Professions Act ; and (b) are listed under Category III — Design Services in Section 3 — Categories of Service of the Guide for the Engagement of a Consulting Professional Engineer adopted by the Association of Professional Engineers and Geoscientists of the Province of Manitoba and by the Consulting Engineers of Manitoba. (« services d'ingénieurs et de géoscientifiques ») "legal services" means services provided under the authority of The Legal Profession Act or by legislation governing the practice of law in another jurisdiction. It includes (a) research related to the provision of a legal service; (b) secretarial or other administrative services related to the provision of a legal service; and (c) providing tax planning advice or estate planning advice in conjunction with the preparation or review of (i) a return or other document for tax purposes, or (ii) a document that is intended to be legally binding; but does not include the following: (d) a service that is entirely or partly funded under The Legal Aid Manitoba Act ; (e) the service of a notary public exercising his or her powers as a notary public; (f) the service of a public officer acting within the scope of his or her authority as a public officer; (g) a service relating to immigration or emigration, unless the service can be provided only by a lawyer; (h) services to obtain a patent or registered trademark, except to the extent that it involves representing a person in an objection or appeal process. (« services d'avocats ») "private investigation services" includes the following services: (a) services provided by a private investigator as defined in The Private Investigators and Security Guards Act ; (b) surveillance services; (c) the service of tracing or locating a person or property. (« services de détectives privés ») "security and security monitoring services" includes the following services: (a) security guard or patrol services for the protection of persons or property, including building monitoring, bodyguard and guard dog services; (b) alarm monitoring services, other than health-monitoring services; (c) an armoured vehicle service that (i) involves the transportation of property, and (ii) employs a person who is licensed to carry a firearm for use in connection with that service; (d) video surveillance services, for the protection of persons or property; but does not include residential house-sitting services. (« services de sécurité et de surveillance de la sécurité ») M.R. 174/2007 ; 144/2013 ; 94/2020 When taxable service relates to Manitoba 3(1) For the purposes of clause 4(1)⁠(i) of the Act and this regulation, a taxable service — other than a legal service — provided outside Manitoba relates to Manitoba if (a) it is provided to a person who resides, ordinarily resides, or carries on business in Manitoba when the service is provided; and (b) it involves or relates to one or more of the following: (i) a physical location in Manitoba, (ii) an actual or contemplated presence in Manitoba, (iii) the actual or contemplated use or consumption of property in Manitoba, (iv) an actual or contemplated transaction, event or business activity in Manitoba. When legal service relates to Manitoba 3(2) For the purposes of clause 4(1)⁠(i) of the Act and this regulation, a legal service provided outside Manitoba relates to Manitoba if (a) it is provided to a person who resides, ordinarily resides, or carries on business in Manitoba when the service is provided; and (b) it involves or relates to one or more of the following: (i) an actual or contemplated court or administrative action or proceeding in Manitoba, (ii) the actual or contemplated incorporation or registration of a corporation under Manitoba law, (iii) the actual or contemplated formation or registration of a partnership under Manitoba law, (iv) the actual or contemplated registration or licensing of an enterprise or business activity under Manitoba law, (v) the interpretation or application of an existing, former or proposed Manitoba law, (vi) a matter referred to in clause (1)⁠(b). EXEMPTIONS Services tax-exempt in certain circumstances 4(1) No tax is payable under the Act on the purchase of a taxable service referred to in clause 4(1)⁠(i) of the Act if (a) the service (i) is purchased by an Indian or a band, as defined in the Indian Act (Canada), who provides the relevant treaty or band number to the vendor, and (ii) is provided on a reserve, as defined in the Indian Act (Canada), or relates to property situated on such a reserve or to an actual or contemplated transaction or event on such a reserve; (a.1) the service (i) is purchased by an Indian or a band, as defined in the Indian Act (Canada), who provides the relevant treaty or band number to the vendor, and (ii) relates to a claim of abuse sustained at a residential school; (b) the service relates to aboriginal treaty or land claim negotiations and is purchased by an aboriginal organization representing the interests of Indians or bands, as defined in the Indian Act (Canada), in the negotiations; (c) the service, although provided in Manitoba, relates solely to (i) a physical location outside Manitoba, (ii) personal property to be delivered outside Manitoba and used exclusively outside Manitoba, or (iii) an actual or contemplated transaction, event or business activity that is occurring or to occur exclusively outside Manitoba; (d) the purchaser and the vendor of the service are corporations or partnerships that (i) are related to each other under section 251 of the Income Tax Act (Canada), or (ii) in the case of a partnership, would be related to each other under section 251 of the Income Tax Act (Canada) if the partnership were a corporation controlled by its majority interest partner, as defined in that Act; or (e) the service is purchased from a vendor who is providing, or is engaged to provide, taxable services exclusively to the purchaser for a period of at least 12 months. Accounting service provided as part of non-taxable service 4(2) No tax is payable under the Act on the purchase of an accounting service provided as part of a non-taxable service if less than 20% of the purchase price is attributable to the accounting service. M.R. 144/2013 Exempt services 5(1) None of the following services is a taxable service under clause 4(1)⁠(i) of the Act if the service is not performed in conjunction with any other service under that clause: (a) consulting of a general nature not relating to a taxable service under clause 4(1)⁠(i) of the Act; (b) teaching or training services; (c) acting as any of the following: (i) a trustee, executor or administrator of an estate, (ii) a trustee in bankruptcy, (iii) a receiver in relation to a person placed in receivership, (iv) a mediator or arbitrator, (v) a director or officer of a corporation; (d) financial planning services, such as (i) assessing a person's financial position, future needs and goals, and (ii) providing investment advice and reporting on investments; (e) providing estate planning advice or tax planning advice; (f) accounting services provided to a mutual fund, a segregated fund or a pension fund. Exemption for preparing will 5(2) None of the following services is a taxable service under clause 4(1)⁠(i) of the Act if the service is provided under the authority of The Legal Profession Act : (a) preparing, reviewing or attending to the execution of a specified estate planning document; (b) providing, in conjunction with a service described in clause (a), estate planning advice or a secretarial or other administrative service. Exemption for preparing personal tax return 5(3) None of the following services is a taxable service under clause 4(1)⁠(i) of the Act: (a) preparing or filing a personal tax return; (b) providing, in conjunction with a service described in clause (a), estate planning advice, tax planning advice or a secretarial or other administrative service. Definition personal tax return 5(4) For the purpose of subsection (3), a "personal tax return" means a return of income that is required to be filed in accordance with paragraph 150(1)⁠(b) or (d) of the Income Tax Act (Canada). It includes any federal or provincial schedules or forms filed with that return and any amendment to such a return. M.R. 143/2019 ; 94/2020 Partial exemption — services relating partly to Manitoba 6(1) When a taxable service is provided to a purchaser who carries on business both in Manitoba and outside Manitoba, no tax is payable under the Act on the fee for the portion of the service that does not relate to Manitoba. Reporting for partial exemption 6(2) When subsection (1) applies to a purchase, (a) if the vendor is required to collect, or does collect, tax payable under the Act in respect of the purchase, the vendor's invoice must show (i) [repealed] M.R. 174/2007, (ii) the non-taxable portion of the fee, and (iii) the taxable portion of the fee; and (b) in any other case, the purchaser must (i) provide the vendor with his or her RST number, (i.1) determine the taxable portion of the fee and report it to the minister as required under subsection 2(4) of the Act, and (ii) retain the documentation that supports his or her determination of the taxable portion. M.R. 174/2007 Tax-exempt disbursements 7 No tax is payable under the Act by a purchaser of an accounting, legal or private investigation service on an amount charged for a related disbursement if that amount (a) is charged on a cost recovery basis separately from the fee for the taxable service; and (b) reimburses the vendor for a third party fee or charge (i) on which no tax would be payable under the Act if the fee or charge were incurred by the vendor as agent for the purchaser, or (ii) on which the vendor has paid the tax that would be payable under the Act if the fee or charge were incurred by the vendor as agent for the purchaser. Taxable portion — architectural services 8 The taxable portion of a fee for architectural services that do not relate to tangible personal property is 30% of the total fee for those services and disbursements related to those services. Taxable portion — geoscientific or engineering services 9 The taxable portion of a fee for geoscientific or engineering services that do not relate to tangible personal property is 30% of the total fee for those services and disbursements related to those services. COMING INTO FORCE Coming into force 10 This regulation is deemed to have come into force on July 1, 2004.