Canada: Enforcement of trailing commission GST/HST extended to 2028
Administrative transition period applies to mutual fund dealers who have not claimed related input tax credits
The Canada Revenue Agency (CRA) has extended the enforcement date to January 1, 2028, for the application of the goods and services tax/harmonized sales tax (GST/HST) to services related to mutual fund trailing commissions provided by mutual fund dealers.
The extension, from the previous date of July 1, 2026, applies when dealers have not claimed input tax credits (ITCs) for GST/HST paid on related business inputs. When dealers have claimed these ITCs, they will be required to collect and remit GST/HST on services related to mutual fund trailing commissions from the day the supplies are made.
The transition rules are confirmed in the updated GST/HST Notice 344, which is designed to assist the industry in adapting to the CRA’s updated position that treats these services as taxable rather than exempt financial services.
Read a June 2026 report prepared by the KPMG member firm in Canada