Businesses and individuals required to pay the regulatory charge on insurance coverage for risks in Alberta that was purchased from an unlicensed insurer in the province will now benefit from a lower charge. Alberta has reduced its regulatory charge related to these insurance premiums to 10% (from 50%), effective May 31, 2022. Generally, affected insured persons must disclose the insurance coverage and pay this charge within 30 days of receiving the insurance coverage.

Compliance with Alberta rules

In general, the compliance rules related to these charges in Alberta remain the same. Businesses and individuals that acquire this type of insurance coverage are required to notify the province through its online Insurance Regulatory Information System and pay the regulatory charge within 30 days of the earlier of signing the insurance contract or receiving any policy, interim receipt or insuring document. Businesses and individuals that do not disclose and pay the 10% charge on time are subject also to a 10% penalty (recently reduced from 50%) calculated on the regulatory charge. Alberta has also indicated in its guidance that the 30-day deadline cannot be extended.

Note that other special rules and deadlines apply for insurance purchased through a licensed special broker. 

For more background information on federal and provincial taxes on cross-border insurance coverage, see TaxNewsNow, "10% Federal Cross-Border Insurance Tax" or contact your KPMG adviser.

Information is current to July 11, 2022. The information contained in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's National Tax Centre at 416.777.8500