GST/HST Elections: Why Being Late Is Not Always Fashionable

In the recent decision Denso Manufacturing Canada Inc. v. Canada (National Revenue), 2020 FC 360, the Federal Court ruled that the Minister of National Revenue (“Minister”) had acted reasonably in exercising its discretionary right to deny a late-filed GST/HST election between two closely related Canadian corporations, Denso Manufacturing Canada, Inc. (“Denso Manufacturing”) and Denso Sales Canada, Inc. (“Denso Sales”, and collectively with Denso Manufacturing, “Denso Corporations”).

• A joint election under section 156 of the Excise Tax Act (Canada) (“ETA”) deems all taxable supplies made between closely related corporations to have been made for nil consideration so that no GST/HST is collectible on such supplies (“156 Election”).