Leases of Corporeal Movable Property

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The lease of corporeal movable property (tangible personal property) for a period of three months or less is considered to be carried out in Québec if the supplier delivers the property or makes it available to the lessee in Québec. The property can be made available by sending it by mail, courier or common carrier retained by the supplier on behalf of the recipient.

The lease of corporeal movable property for a period of more than three months is treated as a series of separate transactions. Each transaction corresponds to a lease period to which a payment is attributable. If the usual location of the corporeal movable property is in Québec, the lease is considered to be carried out in Québec. The supplier and the lessee must determine the location at the start of each lease period.

Note
If the leased property is a road vehicle registered in Québec, the lease is considered to be carried out in Québec.

The lease of property for a given lease period is considered to be carried out on the earliest of the following dates:

  • the first day of the period;
  • the day the payment attributable to the period is due;
  • the day the payment attributable to the period is made.
Example

A leasing business leases a generator for a four-year period to a construction company operating in Québec. The generator is usually stored and maintained in Québec. During the second month of the lease, the construction company expands its operations to Ontario and relocates the generator to Ontario. The first two lease payments are subject to GST and QST. The lease payments attributable to the third month and to all subsequent months are subject to HST, provided the generator remains in Ontario.

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