Wednesday, February 13, 2013
An individual purchased a new condo and claimed a GST rebate under section 254 of the Excise Tax Act. One of the requirements for the rebate is the individual must acquire the property for “use as the primary place of residence.”
The court looked the facts concerning her residency and that of her son. She maintained a larger residence in the same city while owning this property. Her son, a university student, resided in the condo for a short period during the summer break. Further the condo was tiny compared to her existing residence.
The judge found it difficult to believe she intended this condo to be her primary place of residence and denied the GST rebate.
 Ms. Wong is appealing the disallowance of her claim for a GST/HST new housing rebate of $22,982.71 relating to the purchase by her and her spouse of unit 501-2550 Spruce Street in Vancouver (the “Property”).
 The Minister of National Revenue (the “Minister”) disallowed the rebate on the basis that Ms. and Mr. Wong did not acquire the Property for use as their primary place of residence or as the primary place of residence of a relation.
ITA / ETA
| 254(2)—New housing rebate |
 Paragraph 254(2)(b) of the Excise Tax Act, R.S.C., 1985, c. E-15 sets out that the new housing rebate is available where, at the time the purchaser becomes liable or assumes liability under an agreement for purchase and sale of the unit, the purchaser intends to use the unit as a primary residence for him or herself or for a relative.
 At the hearing before me, Ms. Wong presented a number of household bills to show that she and her spouse had moved into the Property and were continuing to reside there and, at one point, she went so far as to say that she and her spouse moved into the Property in August 2011. I find it extremely unlikely that they did, because it was admitted that when they took possession in August 2011, their son moved in and stayed until the end of his summer break from university. It is implausible that Ms. and Mr. Wong and their son would all stay in the Property and leave the house on West 15th Avenue unoccupied. Furthermore, the floor area of the Property was just 631 square feet. The house had a floor area of 2200 square feet and contained an office that Mr. Wong used in the evening.
 Mr. Wong testified that they moved into the Property in February 2012. This is consistent with Ms. Wong’s evidence that they moved in after the rebate claim had been denied. I accept that they did, in fact, begin using the Property a great deal of the time from February 2012 on, despite the fact that the Property was much smaller than their house. However, the actual use of the Property by the Wongs is not relevant, in light of their own testimony that they did not intend to use the Property as their primary place of residence when they entered into the contract to purchase it.
 Given that the Wongs’ son was expected to spend the majority of his time away from Vancouver in 2011, 2012 and at least the early part of 2013, and that his subsequent plans were uncertain, I find that, in December 2009, the Wongs did not expect or intend that the Property would be his primary residence.
 For these reasons, I find that Ms. Wong is not entitled to the GST/HST rebate, and her appeal is dismissed.
A paragraph beginning with a number in square brackets is a direct quote from the case.