Information and Disclaimer
This interpretation letter was issued based on the specific circumstances or situation of a taxpayer or vendor and the law and tax policy in effect at the time the ruling was issued. Specific facts relevant to your situation may change the application of the tax. In accordance with the Freedom of Information and Protection of Privacy Act, all confidential and identifying information has been removed from this interpretation letter. Please be aware that any statute or policy referred to in this letter may have been superseded. Where a letter contains links to a publication, the link is to our current publication on that subject, regardless of the date that the ruling was originally issued, and the current publication may not be reflective of the information originally provided. In no event shall the Government of Ontario be liable for any damages whatsoever arising out of, or in connection with, the use of the information contained herein.
Interpretation Letter MF-0002, May 2000
Thank you for your March 19th, 2000, facsimile regarding the application of Ontario retail sales tax (RST)
to the purchase of photographic chemicals and film, and the charges made by Company A for flying time
and photograph negatives.
Understanding of Facts
We understand that Company A provides an aerial photograph service. Company A invoices are based on
a fee for flying time and charge for each photograph negative.
Company A is asking whether it should be paying RST on its purchases of photographic chemicals and
film, and whether RST applies to its charges for flying time and photographic negatives.
Legislation and/or Administrative Policy
RST should be charged, collected and remitted on the sale of photographs, negatives, slides, film etc.
Retail Sales Tax Guide #509 - Photographers is enclosed for your future reference.
Vendors may purchase materials exempt from RST that become part of the product sold to others by
providing their suppliers with a properly completed purchase exemption certificate (PEC). The enclosed
Retail Sales Tax Guide #204 - Purchase Exemption Certificates provides further information.
Persons who develop photographs may qualify for exemption from RST on the purchase of machinery,
equipment and processing materials used primarily and directly in the manufacturing process. Retail Sales
Tax Guide #400 - Manufacturers has further information on manufacturing operations and available
exemptions.
Commercial aircraft and their repairs may be purchased exempt from RST.
Analysis and Conclusion
Company A should charge, collect and remit RST on its sales of negatives. The selling price of the
negatives include the charge for the aircraft and pilot. Even if Company A separates the charges for the
flying time from the charge for the negatives, the entire invoice is subject to RST as the flying time is a
component of the fair value of the negatives.
If Company A's photographic sales exceed $5,000 in a fiscal year, it would qualify as a manufacturer for
RST purposes. Consequently, Company A could purchase film and print processors, cameras and
attachments, filters, film and film loaders, chemicals, etc., exempt from RST by providing its suppliers with
properly completed PECs. If the equipment purchased by Company A qualifies for exemption from RST,
repairs would also be exempt from RST.
If Company A does not qualify as a manufacturer, it must pay RST on the film, chemicals, etc. Since
Company A has purchased chemicals exempt from RST, it would be required to self-assess RST on these
purchases. RST would be calculated on the total value of the chemicals brought into Ontario. Total value
includes the purchase price in Canadian dollars, shipping, mailing, customs and duties. We have enclosed
Retail Sales Tax Guides 202 Goods Brought Into Ontario and 201 How to Complete your Tax Return,
which provide additional information.
If you have any further questions, please contact this office.
