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Alcohol and Gaming Regulation and Public Protection Act, 1996
Loi de 1996 sur la réglementation des alcools et des jeux et la protection du public

ONTARIO REGULATION 257/10

TAX ON BEER, WINE AND SPIRITS

Consolidation Period: From June 9, 2017 to the e-Laws currency date.

Last amendment: 189/17.

Legislative History: 318/11, 408/16, 189/17.

This Regulation is made in English only.

CONTENTS

Interpretation

1.

Definitions

Obligation to Pay Tax

2.

Not subject to tax: purchase of beer on reserve by Indians

3.

Purchases by, and refunds to, diplomats, etc.

Calculation of Tax

5.

Annual adjustment to rate of basic tax

Tax Collection and Remittance

6.

Remittance by authorized beer manufacturer

7.

Remittance by licensee of a brew pub

8.

Remittance by winery

8.1

Remittance by spirits manufacturer

9.

Deduction from remittance re refunds to purchaser

10.

Deduction from remittance re unconsumable beer

Returns and Information

11.

Monthly return from beer manufacturer

12.

Monthly return from licensee of a brew pub

13.

Other returns from beer vendors

14.

Monthly or quarterly return from winery

14.1

Monthly return from spirits manufacturer

Records and Books of Account

15.

Record-keeping by beer manufacturer

16.

Record-keeping by licensee of a brew pub

17.

Record-keeping by other beer vendor

18.

Record-keeping by winery

19.

Record-keeping re environmental tax on wine and wine coolers

19.0.1

Record-keeping by spirits manufacturer

19.0.2

Record-keeping re environmental tax on spirits and spirits cooler

19.1

Record-keeping by authorized grocery store

20.

Retention of records

Interest Rates

21.

Description of interest rates

22.

Interest on debts

23.

Interest on overpayments

24.

Interest re excess refunds

Refunds

25.

Refund to purchaser

26.

Refund re uncollectible debt

27.

Refund re product loss (beer)

28.

Duty to repay refund

 

Interpretation

Definitions

1. In this Regulation,

“basic interest rate” means, with respect to a particular date, the interest rate described in subsection 21 (2);

“government interest rate” means, with respect to a particular date, the interest rate described in subsection 21 (4);

“standard interest rate” means, with respect to a particular date, the interest rate described in subsection 21 (3). O. Reg. 257/10, s. 1.

Obligation to Pay Tax

Not subject to tax: purchase of beer on reserve by Indians

2. (1) This section applies with respect to a purchaser who is an Indian and who, under clause 17 (3) (d) of the Act, is not subject to tax under the Act in respect of the purchase of beer on a reserve for the exclusive use of an Indian. O. Reg. 257/10, s. 2 (1).

(2) The purchaser is not required to pay taxes in respect of the purchase of beer exempt from tax on a reserve, if, when making the purchase, the purchaser presents to the licensee the purchaser’s status card issued by Indigenous and Northern Affairs Canada. O. Reg. 257/10, s. 2 (2); O. Reg. 408/16, s. 1.

(3) The licensee who sells the beer to the purchaser shall keep a record of the sale, including the date of the sale, the brand of beer sold, the volume of beer sold and the purchaser’s status card number. O. Reg. 257/10, s. 2 (3).

(4) Upon request, the licensee and the purchaser shall give an employee of the Ministry such information as the employee may request to verify the purchaser’s purchases of beer exempt from tax. O. Reg. 257/10, s. 2 (4).

Purchases by, and refunds to, diplomats, etc.

3. (1) This section applies with respect to a purchaser who, under clause 17 (3) (e) of the Act, is not subject to tax under the Act in respect of the purchase of liquor. O. Reg. 257/10, s. 3 (1); O. Reg. 189/17, s. 2 (1).

(2) The purchaser is required by section 18 of the Act to pay taxes on the purchase of liquor at the time of the purchase but may apply to the Minister under section 25 for a refund of the tax paid. O. Reg. 257/10, s. 3 (2); O. Reg. 189/17, s. 2 (2).

Calculation of Tax

4. Revoked: O. Reg. 408/16, s. 2.

Annual adjustment to rate of basic tax

5. The annual adjustment date referred to in section 26 of the Act (Annual adjustment to rate of basic tax) is March 1 or, if March 1 is a Saturday or Sunday, the following Monday. O. Reg. 257/10, s. 5.

Tax Collection and Remittance

Remittance by authorized beer manufacturer

6. An authorized beer manufacturer that is required by subsection 30 (6) of the Act to remit amounts collected to the Minister shall remit those amounts when filing the monthly return for the period in which the amounts were collected. O. Reg. 257/10, s. 6.

Remittance by licensee of a brew pub

7. A licensee of a brew pub that is required by subsection 30 (9) of the Act to remit to the Minister the taxes and amounts referred to in that subsection shall remit those taxes and amounts when filing the monthly return for the period in which they were collected. O. Reg. 257/10, s. 7.

Remittance by winery

8. (1) A winery that is required by subsection 31 (2) of the Act to remit to the Minister the taxes referred to in that subsection shall remit those taxes when filing the monthly or quarterly return, as the case may be, for the period in which the taxes were collected. O. Reg. 257/10, s. 8 (1).

(2) If a winery is deemed by paragraph 3 or 4 of subsection 17 (2) of the Act to be a purchaser, the winery shall remit to the Minister the tax on the wine referred to in those paragraphs at the same time that the winery remits taxes under subsection (1). O. Reg. 257/10, s. 8 (2).

Remittance by spirits manufacturer

8.1 (1) A spirits manufacturer that is required by subsection 30.2 (2) of the Act to remit to the Minister the taxes referred to in that subsection shall remit those taxes when filing the monthly return for the period in which the taxes were collected. O. Reg. 189/17, s. 3.

(2) If a spirits manufacturer is deemed by paragraph 5 of subsection 17 (2) of the Act to be a purchaser, the spirits manufacturer shall remit to the Minister the tax on the spirits referred to in that paragraph at the same time that the spirits manufacturer remits taxes under subsection (1). O. Reg. 189/17, s. 3.

Deduction from remittance re refunds to purchaser

9. (1) This section applies if a beer vendor, spirits manufacturer, winery or affiliate of a winery collects tax under the Act from a purchaser and,

(a) the tax payable and collected was overstated by reason of a clerical or arithmetical error in computation; or

(b) the liquor was returned and the price paid for it was refunded or credited to the purchaser. O. Reg. 257/10, s. 9 (1); O. Reg. 189/17, s. 4 (1).

(2) The beer vendor, spirits manufacturer, winery or affiliate of a winery may refund to the purchaser all or part of the tax, as the case requires, within four years after the sale with respect to which the tax was collected. O. Reg. 257/10, s. 9 (2); O. Reg. 189/17, s. 4 (2).

(3) The beer vendor, spirits manufacturer, winery or affiliate of a winery may deduct the amount refunded to the purchaser from a subsequent remittance under the Act if it takes the deduction within one year after the date of the refund. O. Reg. 257/10, s. 9 (3); O. Reg. 189/17, s. 4 (3).

Deduction from remittance re unconsumable beer

10. (1) This section applies if a beer vendor destroys unconsumable beer or returns it to the person from whom the beer vendor purchased it. O. Reg. 257/10, s. 10 (1).

(2) The beer vendor may deduct from a subsequent remittance under the Act the amount paid on account of tax for the unconsumable beer if it takes the deduction within one year after destroying or returning the beer. O. Reg. 257/10, s. 10 (2).

(3) If the unconsumable beer is destroyed by the beer vendor, the beer vendor shall keep documentation showing that the beer was destroyed. O. Reg. 257/10, s. 10 (3).

(4) If the unconsumable beer is returned to the person from whom the beer vendor purchased it, the person shall keep documentation showing that the beer was returned and subsequently destroyed. O. Reg. 257/10, s. 10 (4).

(5) In this section,

“unconsumable beer” does not include beer that is unconsumable as a result of breakage, spillage or shrinkage. O. Reg. 257/10, s. 10 (5).

Returns and Information

Monthly return from beer manufacturer

11. (1) Every beer manufacturer shall deliver to the Minister for each month a return in the form approved by the Minister containing the following information:

1. The quantity of draft beer and non-draft beer manufactured by or for the beer manufacturer for its own distribution or for distribution to another person.

2. The quantity of draft beer and non-draft beer received by the beer manufacturer and the names of the persons from whom the beer was received.

3. The quantity of draft beer and non-draft beer sold, delivered, exported, transferred or consumed by the beer manufacturer and the names of the persons, other than purchasers, to whom the beer was sold, delivered, exported or transferred.

4. The quantity of draft beer and non-draft beer for which a deduction is made under section 9, 10, 26 or 27.

5. The beer manufacturer’s inventory, at the beginning and the end of the reporting period, of draft beer and non-draft beer.

6. The number of non-refillable containers sold to purchasers. O. Reg. 257/10, s. 11 (1); O. Reg. 408/16, s. 3.

(2) A beer manufacturer shall deliver its return for a month on or before the 20th day of the following month. O. Reg. 257/10, s. 11 (2).

Monthly return from licensee of a brew pub

12. (1) Every licensee of a brew pub shall deliver to the Minister for each month a return in the form approved by the Minister containing the following information:

1. The quantity of draft beer made by the licensee for its brew pub.

2. The quantity of draft beer sold, delivered, transferred or consumed by the licensee and the names of the persons, other than purchasers, to whom the beer was sold, delivered or transferred.

3. The licensee’s inventory, at the beginning and end of the reporting period, of draft beer manufactured by the licensee.

4. Such other information as the Minister may request. O. Reg. 257/10, s. 12 (1).

(2) A licensee of a brew pub shall deliver its return for a month on or before the 20th day of the following month. O. Reg. 257/10, s. 12 (2).

Other returns from beer vendors

13. A beer vendor that is not required to deliver a monthly or quarterly return shall, if requested to do so by the Minister, deliver a return to the Minister containing the following information for the period specified by the Minister:

1. The quantity of beer purchased or otherwise received by the beer vendor.

2. The quantity of beer sold, delivered, transferred or consumed by the beer vendor.

3. The name and address of all persons from whom the beer vendor purchased or otherwise received beer.

4. The name and address of all persons, other than purchasers, to whom the beer vendor sold, delivered or transferred beer.

5. The beer vendor’s inventory of beer at the beginning and end of the period. O. Reg. 257/10, s. 13.

Monthly or quarterly return from winery

14. (1) Every winery that operates a winery retail store shall deliver to the Minister a return for each month in the form approved by the Minister containing the information required by subsection (6). O. Reg. 257/10, s. 14 (1).

(2) A winery shall deliver its return for a month on or before the 20th day of the following month. O. Reg. 257/10, s. 14 (2).

(3) Despite subsection (1), if the total tax collectable and payable by a winery for a year is less than $15,000, or if the Minister determines that it is likely to be less than that amount, the Minister may authorize or require the winery to deliver quarterly returns instead of delivering monthly returns. O. Reg. 257/10, s. 14 (3).

(4) A winery shall deliver its quarterly return on or before January 20, April 20, July 20 or October 20 for the quarter ending on December 31, March 31, June 30 or September 30, as the case may be. O. Reg. 257/10, s. 14 (4); O. Reg. 408/16, s. 4.

(5) If the Minister determines that subsection (3) no longer applies to a winery, the Minister may require the winery to resume delivering monthly returns. O. Reg. 257/10, s. 14 (5).

(6) Each monthly or quarterly return must contain the following information for the month or quarter:

1. The quantity and retail price of wine and wine cooler sold, delivered, exported, transferred or consumed by the winery or affiliate and the names of the persons, other than purchasers, to whom it was sold, delivered, exported or transferred.

2. The quantity and retail price of wine and wine cooler for which a deduction is made under section 9 or 26.

3. The number of non-refillable containers sold to purchasers. O. Reg. 257/10, s. 14 (6).

Monthly return from spirits manufacturer

14.1 (1) Every spirits manufacturer that operates a distillery retail store shall deliver to the Minister a return for each month in the form approved by the Minister containing the information required by subsection (3). O. Reg. 189/17, s. 5.

(2) A spirits manufacturer shall deliver its return for a month on or before the 20th day of the following month. O. Reg. 189/17, s. 5.

(3) Each monthly return must contain the following information for the month:

1. The quantity and retail price of spirits and spirits cooler sold, delivered, exported, transferred or consumed by the spirits manufacturer and the names of the persons, other than purchasers, to whom it was sold, delivered, exported or transferred.

2. The quantity and retail price of spirits and spirits cooler for which a deduction is made under section 9 or 26.

3. The number of non-refillable containers sold to purchasers. O. Reg. 189/17, s. 5.

Records and Books of Account

Record-keeping by beer manufacturer

15. (1) Every beer manufacturer shall keep a record of the information required for its monthly returns. O. Reg. 257/10, s. 15 (1).

(2) If a beer manufacturer exports beer from Ontario to another province or territory of Canada, the beer manufacturer shall keep the following records:

1. A copy of each bill of lading, properly completed, and any documentation relating to an inter-plant transfer.

2. All export sales invoices issued by the beer manufacturer.

3. Such other records as may be required to prove delivery of the beer to another province or territory of Canada. O. Reg. 257/10, s. 15 (2).

(3) If a beer manufacturer exports beer from Ontario to the United States, the beer manufacturer shall keep the following records:

1. A copy of each survey report prepared when the beer is loaded.

2. A photocopy of the front and back pages of each U.S. Customs Proforma Invoice prepared by a Canadian customs agent and stamped by the U.S. Customs Service and a photocopy of each U.S. Customs document Form 7533.

3. A copy of each bill of lading, properly completed.

4. All export sales invoices issued by the beer manufacturer.

5. Such other records as may be required to prove delivery of the beer to the United States. O. Reg. 257/10, s. 15 (3).

(4) If a beer manufacturer exports beer from Ontario to a country other than the United States, the beer manufacturer shall keep the following records:

1. A copy of each survey report prepared when the beer is loaded and when it is offloaded at the delivery point.

2. A copy of each bill of lading, properly completed.

3. All export sales invoices issued by the beer manufacturer.

4. Such other records as may be required to prove delivery of the beer outside Canada. O. Reg. 257/10, s. 15 (4).

(5) If a beer manufacturer distributes beer that is exempt from tax under section 18.1 of the Act, the beer manufacturer shall keep a record of the following information:

1. The date that the beer was distributed.

2. The name and address of all persons to whom the beer was distributed or the name and address of the event at which the beer was distributed.

3. The number of containers of beer distributed and for each container,

i. whether the beer was draft beer or non-draft beer,

ii. the quantity of beer in the container, and

iii. whether or not the container was a non-refillable container. O. Reg. 318/11, s. 2.

(6) If an affiliate of a beer manufacturer distributes beer that is exempt from tax under section 18.1 of the Act, the beer manufacturer shall keep a record of the following information:

1. The name of the affiliate.

2. The date that the beer was distributed.

3. The quantity of beer that was distributed.

4. The amount of tax that would have been payable by the affiliate if the exemption did not apply. O. Reg. 318/11, s. 2.

Record-keeping by licensee of a brew pub

16. (1) Every licensee of a brew pub shall keep a record of the information required for its monthly returns. O. Reg. 257/10, s. 16.

(2) If a licensee of a brew pub distributes draft beer that is exempt from tax under section 18.1 of the Act, the licensee shall keep a record of the following information:

1. The date that the beer was distributed.

2. The name and address of all persons to whom the beer was distributed or the name and address of the event in the brew pub, or a secondary location related to the pub, at which the beer was distributed.

3. The quantity of beer that was distributed. O. Reg. 318/11, s. 3.

(3) If an affiliate of a licensee of a brew pub distributes beer that is exempt from tax under section 18.1 of the Act, the licensee shall keep a record of the following information:

1. The name of the affiliate.

2. The date that the beer was distributed.

3. The quantity of beer that was distributed.

4. The amount of tax that would have been payable by the affiliate if the exemption did not apply. O. Reg. 318/11, s. 3.

Record-keeping by other beer vendor

17. Every beer vendor, other than a beer manufacturer, shall keep a record of the following information:

1. The quantity of beer purchased or otherwise received by the beer vendor.

2. The quantity of beer sold, delivered, transferred or consumed by the beer vendor.

3. The name and address of all persons from whom the beer vendor purchased or otherwise received beer.

4. The name and address of all persons, other than purchasers, to whom the beer vendor sold, delivered or transferred beer.

5. The beer vendor’s inventory of beer. O. Reg. 257/10, s. 17.

Record-keeping by winery

18. (1) Every winery that is required to submit monthly or quarterly returns to the Minister shall keep a record of the information required for its returns. O. Reg. 257/10, s. 18.

(2) If a winery distributes wine or a wine cooler that is exempt from tax under section 18.1 of the Act, the winery shall keep a record of the following information:

1. The date that the wine or wine cooler was distributed.

2. The name and address of all persons to whom the wine or wine cooler was distributed or the name and address of the event at which the wine or wine cooler was distributed.

3. The number of containers of wine or wine coolers that were distributed and for each container,

i. whether or not the wine was Ontario wine or whether or not the wine cooler was an Ontario wine cooler,

ii. the brand of the wine or wine cooler,

iii. the quantity of wine or wine cooler in the container,

iv. the retail price of the wine or wine cooler as determined under subsection 27 (3) of the Act, and

v. whether or not the container was a non-refillable container. O. Reg. 318/11, s. 4.

(3) If an affiliate of a winery distributes wine or a wine cooler that is exempt from tax under section 18.1 of the Act, the winery shall keep a record of the following information:

1. The name of the affiliate.

2. The date that the wine or wine cooler was distributed.

3. The quantity of wine or wine coolers that were distributed.

4. The amount of tax that would have been payable by the affiliate if the exemption did not apply. O. Reg. 318/11, s. 4.

Record-keeping re environmental tax on wine and wine coolers

19. Every collector of tax on wine and wine coolers that does not charge the environmental tax under section 29 of the Act shall keep the following records:

1. Records providing evidence that, at the time of any sale on which it has not charged the environmental tax, the winery that manufactured the wine or wine cooler had a comprehensive program for the return and refilling of its containers.

2. Records providing evidence of the number of the winery’s containers that are refilled by the winery each year. O. Reg. 257/10, s. 19.

Record-keeping by spirits manufacturer

19.0.1 (1) Every spirits manufacturer that is required to submit monthly returns to the Minister shall keep a record of the information required for its returns. O. Reg. 189/17, s. 5.

(2) If a spirits manufacturer distributes spirits or spirits cooler that is exempt from tax under section 18.1 of the Act, the spirits manufacturer shall keep a record of the following information:

1. The date that the spirits or spirits cooler was distributed.

2. The name and address of all persons to whom the spirits or spirits cooler was distributed or the name and address of the event at which the spirits or spirits cooler was distributed.

3. The number of containers of spirits or spirits cooler that were distributed and for each container,

i. the brand of the spirits or spirits cooler,

ii. the quantity of spirits or spirits cooler in the container,

iii. the retail price of the spirits or spirits cooler as determined under subsection 29.1 (2) of the Act, and

iv. whether or not the container was a non-refillable container. O. Reg. 189/17, s. 5.

(3) If an affiliate of a spirits manufacturer distributes spirits or spirits cooler that is exempt from tax under section 18.1 of the Act, the spirits manufacturer shall keep a record of the following information:

1. The name of the affiliate.

2. The date that the spirits or spirits cooler was distributed.

3. The quantity of spirits or spirits cooler that was distributed.

4. The amount of tax that would have been payable by the affiliate if the exemption did not apply. O. Reg. 189/17, s. 5.

Record-keeping re environmental tax on spirits and spirits cooler

19.0.2 Every collector of tax on spirits and spirits cooler that does not charge the environmental tax under section 29 of the Act shall keep the following records:

1. Records providing evidence that, at the time of any sale on which it has not charged the environmental tax, the spirits manufacturer that manufactured the spirits or spirits cooler had a comprehensive program for the return and refilling of its containers.

2. Records providing evidence of the number of the spirits manufacturer’s containers that are refilled by the manufacturer each year. O. Reg. 189/17, s. 5.

Record-keeping by authorized grocery store

19.1 Every authorized grocery store shall keep a record of the following information:

1. The quantity of wine and wine coolers purchased or otherwise received by the operator of the authorized grocery store.

2. The number of non-refillable containers in which the wine and wine coolers were purchased or otherwise received by the operator of the authorized grocery store.

3. The quantity of wine and wine coolers sold, delivered, transferred or consumed by the operator of the authorized grocery store.

4. The retail price of the wine and wine coolers sold, delivered, transferred or consumed by the operator of the authorized grocery store.

5. The number of non-refillable containers in which the wine and wine coolers were sold, delivered or transferred by the operator of the authorized grocery store, including containers containing wine and wine coolers which, under the Act, the operator is deemed to have purchased. O. Reg. 408/16, s. 5.

Retention of records

20. (1) The terms and conditions set out in this section apply with respect to each collector’s duty under subsection 37 (4) of the Act to retain records and books of account and to retain every account and voucher necessary to verify the information contained in the records and books of account. O. Reg. 257/10, s. 20 (1).

(2) Subject to subsection (3), the collector shall retain each record, account and voucher for at least seven years after the end of the year to which it relates and shall retain each book of account for at least seven years after the end of the year in which the last entry is made. O. Reg. 257/10, s. 20 (2).

(3) Even if the seven-year period referred to in subsection (2) has expired, the collector is required to retain the records, books of account, accounts or vouchers in any of the following circumstances:

1. They relate to a period for which all returns required under the Act have not been delivered to the Minister or a period for which all taxes assessed under the Act have not been paid.

2. They relate to a period for which there is an outstanding dispute between the collector and the Minister with respect to any tax payable or remitted by the collector.

3. The time limit for filing a notice of objection to any assessment or statement of disallowance for the period to which they relate has not expired.

4. Any demand by the Minister to produce them has not been satisfied.

5. The Minister has given the collector notice under subsection 37 (3) of the Act requiring the collector to keep them. O. Reg. 257/10, s. 20 (3).

Interest Rates

Description of interest rates

21. (1) The rates of interest payable under the Act are set out in this section and the circumstances in which each rate applies are specified in this Regulation. O. Reg. 257/10, s. 21 (1).

(2) The basic interest rate for a particular date is the following rate:

1. If the particular date is an adjustment date, it is the average prime rate for the most recent previous calculation date.

2. If the particular date is not an adjustment date, it is the average prime rate for the most recent previous adjustment date. O. Reg. 257/10, s. 21 (2).

(3) The standard interest rate for a particular date is an annual interest rate that is three percentage points higher than the basic interest rate for that date. O. Reg. 257/10, s. 21 (3).

(4) The government interest rate for a particular date is an annual interest rate that is the greater of zero or the rate that is three percentage points lower than the basic interest rate for that date. O. Reg. 257/10, s. 21 (4).

(5) In this section,

“adjustment date” means January 1, April 1, July 1 or October 1;

“average prime rate”, with respect to a particular date, means the mean — rounded to the nearest percentage point – of the annual rate of interest announced by each of the following banks to be its prime or reference rate of interest in effect on that date for determining interest rates on Canadian dollar commercial loans by that bank in Canada:

1. Bank of Montreal.

2. The Bank of Nova Scotia.

3. Canadian Imperial Bank of Commerce.

4. The Royal Bank of Canada.

5. The Toronto-Dominion Bank;

“calculation date” means January 15, April 15, July 15 or October 15. O. Reg. 257/10, s. 21 (5).

Interest on debts

22. The standard interest rate applies with respect to interest payable by a person under subsection 44 (1) of the Act on debt referred to in that subsection. O. Reg. 257/10, s. 22.

Interest on overpayments

23. The following is the rate of interest payable by, or to be applied by, the Minister under subsection 46 (4) or (5) of the Act on the amount of an overpayment:

1. The government interest rate applies if the overpayment results from the payment to the Minister of an amount in excess of the amount required.

2. The basic interest rate applies if the overpayment results from a decision of the Minister or a court on an objection to, or an appeal from an assessment or a statement of disallowance. O. Reg. 257/10, s. 23.

Interest re excess refunds

24. The standard interest rate applies with respect to interest payable on an assessment under subsection 48 (1) of the Act for a refund to which a person was not entitled or in excess of the amount to which a person was entitled. O. Reg. 257/10, s. 24.

Refunds

Refund to purchaser

25. (1) The Minister shall refund to a purchaser an amount paid by the purchaser as tax under the Act if all of the following circumstances exist:

1. The amount was not payable as tax under the Act and was not paid to discharge a liability under an assessment made under the Act.

2. Application for the refund is made to the Minister within four years after the date on which the amount was paid, or within such longer period as the Minister may permit under subsection (2).

3. The Minister receives evidence satisfactory to him or her that the amount was wrongfully paid.

4. The purchaser has not received a refund of the tax from the beer vendor, spirits manufacturer, winery or affiliate of a winery, as the case may be. O. Reg. 257/10, s. 25 (1); O. Reg. 189/17, s. 6.

(2) The Minister may permit an application for a refund to be made within six months after the expiry of the four-year period described in paragraph 2 of subsection (1) if, before that four-year period expires, the purchaser,

(a) notifies the Minister that the application for a refund will be made;

(b) gives the Minister evidence of the nature of the claim; and

(c) gives the Minister an explanation, satisfactory to the Minister, of the reason that full particulars of the claim cannot be furnished in the proper form within the four-year period. O. Reg. 257/10, s. 25 (2).

Refund re uncollectible debt

26. (1) A beer vendor may apply to the Minister for a refund of the amount paid by it on account of taxes paid under the Act in respect of beer sold by it if all or part of the sale price has not been paid and has become an uncollectible debt. O. Reg. 257/10, s. 26 (1).

(2) A winery may apply to the Minister for a refund of the amount paid by it on account of taxes paid under the Act in respect of wine or wine cooler sold by it if all or part of the sale price has not been paid and has become an uncollectible debt. O. Reg. 257/10, s. 26 (2).

(2.1) A spirits manufacturer may apply to the Minister for a refund of the amount paid by it on account of taxes paid under the Act in respect of spirits or spirits cooler sold by it if all or part of the sale price has not been paid and has become an uncollectible debt. O. Reg. 189/17, s. 7 (1).

(3) The applicant shall deliver the application to the Minister, in a form acceptable to the Minister, within four years after the following date:

1. For an uncollectible debt that is not a receivership debt or a bankruptcy debt, the last day of the applicant’s fiscal year in which it writes off the debt as an uncollectible account.

2. For a receivership debt, the date on which the applicant files its claim with the debtor’s receiver.

3. For a bankruptcy debt, the date on which the applicant files its claim with the trustee in bankruptcy. O. Reg. 257/10, s. 26 (3).

(4) The application must include the following information and documents and such other information as the Minister may request:

1. Copies of all invoices for the sale of liquor in respect of which the refund is claimed.

2. Proof satisfactory to the Minister that the amount claimed was remitted to the Minister under the Act or was paid over as required under the Act for remittance to the Minister.

3. A signed statement by the applicant certifying the amount of the debt and certifying that the applicant does not have any right to receive any payment in satisfaction of all or part of the debt from any person other than the debtor or the debtor’s representative.

4. Proof satisfactory to the Minister that all reasonable collection action has been taken to obtain payment of the debt, that the debt is unsecured, that the debt is uncollectible and that the applicant has written off the debt as uncollectible in accordance with generally accepted accounting principles.

5. If the debt is a receivership debt, a signed statement by the applicant certifying that the applicant has filed with the debtor’s receiver a claim in respect of the debt to which the refund relates.

6. If the debt is a bankruptcy debt, a copy of the applicant’s proof of claim in the bankruptcy in respect of the debt to which the refund relates, proof satisfactory to the Minister that the proof of claim was not disallowed and proof satisfactory to the Minister that the applicant will not receive payment of the debt from the trustee in bankruptcy or another person.

7. If the debt is a receivership debt or a bankruptcy debt, an assignment to the Minister in a form satisfactory to the Minister of the portion of the debt equal to the amount of the refund claimed. O. Reg. 257/10, s. 26 (4); O. Reg. 189/17, s. 7 (2).

(5) The Minister may refund to the applicant the amount that has been remitted to the Minister under the Act or paid over as required under the Act for remittance to the Minister in respect of the uncollectible debt as determined using the formula,

(A/B) × C

in which,

  “A” is the amount of the uncollectible debt,

  “B” is the total sale price of the liquor, and

  “C” is the amount remitted to the Minister or paid over for remittance to the Minister in respect of the liquor.

O. Reg. 257/10, s. 26 (5); O. Reg. 189/17, s. 7 (3).

(6) The Minister shall not make a refund to an applicant if any of the following circumstances exist:

1. If the sale was made in contravention of any applicable law.

2. If the Minister is not satisfied that the debt is uncollectible.

3. For uncollectible debt relating to the sale of beer, if any portion of the sale price has been assigned by contract, with or without recourse, to a person other than the Minister unless it has been assigned for security purposes only.

4. If the applicant and the debtor were not dealing at arm’s length within the meaning of section 251 of the Income Tax Act (Canada) at the time of the sale of the liquor.

5. If a refund of an amount on account of the tax has previously been made, or if the applicant is otherwise entitled under the Act to apply to receive a refund of the amount or to receive an allowance in compensation for the amount. O. Reg. 257/10, s. 26 (6); O. Reg. 189/17, s. 7 (4).

(7) Instead of paying a refund, the Minister may permit the applicant to deduct the amount of the refund from a future remittance under the Act if the liquor was manufactured by the applicant. O. Reg. 257/10, s. 26 (7); O. Reg. 189/17, s. 7 (5).

(8) In this section,

“bankruptcy debt” means a debt incurred by a person who subsequently becomes a bankrupt within the meaning of the Bankruptcy and Insolvency Act (Canada);

“receivership debt” means a debt owed by a debtor who is in receivership and whose property is under the control of a receiver;

“sale price” includes the tax or amount on account of the tax under the Act and any other applicable sales tax in respect of the liquor. O. Reg. 257/10, s. 26 (8); O. Reg. 189/17, s. 7 (6).

Refund re product loss (beer)

27. (1) A beer vendor may apply to the Minister for a refund of the amount paid by it on account of taxes paid under the Act in respect of beer that has been lost, destroyed or stolen, other than beer that has been lost or destroyed as a result of breakage, spillage or shrinkage. O. Reg. 257/10, s. 27 (1).

(2) The applicant shall deliver the application to the Minister, in a form acceptable to the Minister, within four years after the date of the loss. O. Reg. 257/10, s. 27 (2).

(3) The application must include the following information and documents and such other information as the Minister may request:

1. A copy of any settlement of a claim, or written confirmation from an insurance company of the settlement of a claim, for the loss with respect to which the refund is claimed.

2. A copy of any police report made with respect to the loss.

3. A copy of any fire marshal’s report made with respect to the cause of the loss.

4. Proof that the amount claimed was remitted to the Minister under or was paid over as required under the Act for remittance to the Minister. O. Reg. 257/10, s. 27 (3).

(4) The Minister may refund to the applicant the amount that has been remitted to the Minister under the Act or paid over as required under the Act for remittance to the Minister in respect of the beer that has been lost, destroyed or stolen. O. Reg. 257/10, s. 27 (4).

(5) The Minister shall not make a refund to an applicant if any of the following circumstances exist:

1. If the Minister considers that the beer was lost, destroyed or stolen as a result of the applicant’s failure to comply with any applicable law.

2. If, when the beer was lost, destroyed or stolen, the applicant was in contravention of any applicable law relating to the beer.

3. If the Minister is not satisfied about whether the applicant has received compensation for the loss.

4. If a refund of an amount on account of the tax has previously been made, or if the applicant is otherwise entitled under the Act to apply to receive a refund of the amount or to receive an allowance in compensation for the amount. O. Reg. 257/10, s. 27 (5).

(6) Instead of paying a refund, the Minister may permit the applicant to deduct the amount of the refund from a future remittance under the Act if the beer was manufactured by the applicant. O. Reg. 257/10, s. 27 (6).

Duty to repay refund

28. (1) This section applies in each of the following circumstances:

1. If a collector who receives a refund under section 26 in respect of an uncollectible debt subsequently receives a payment from the debtor or from another person in satisfaction of all or part of the debt.

2. If a collector who receives a refund under section 27 in respect of beer that has been lost, destroyed or stolen subsequently receives a payment in compensation for the loss. O. Reg. 257/10, s. 28 (1).

(2) When the collector receives the payment, the collector shall pay to the Minister the portion of the payment that is determined by the Minister to have been paid to the collector on account of tax payable under the Act. O. Reg. 257/10, s. 28 (2).

(3) If the refund was in respect of beer, the payment to the collector shall be allocated, for the purposes of this section, to the applicable sales of beer in order of the dates of the sales. O. Reg. 257/10, s. 28 (3).

29. Omitted (provides for coming into force of provisions of this Regulation). O. Reg. 257/10, s. 29.