Tax Insights: Saskatchewan PST alert – Province reverses position on taxation of certain insurance premiums

February 28, 2018

Issue 2018-11

In brief

On February 26, 2018, Saskatchewan announced that the following insurance premiums will be exempt from the 6% PST: 

  • individual and group life insurance
  • individual and group health, disability, accident and sickness insurance
  • agriculture insurance including crop and livestock insurance, hail insurance and margin/income insurance

This exemption applies starting February 26, 2018, and is retroactive to August 1, 2017, the date insurance premiums became taxable in Saskatchewan.

In detail

Insurance subject to PST

PST continues to apply to other types of insurance, including farm property, equipment and vehicle insurance.

It also applies to bundled insurance if the value of the taxable and exempt components is not segregated.

Refund of PST

Refund mechanisms for PST already collected and/or remitted have not yet been established, and will be designed in consultation with industry representatives.

The takeaway

Insurers and brokers that are currently collecting PST in respect of exempt premiums should: 

  • update billing systems to stop PST collection immediately
  • reconcile PST collected and/or remitted to be ready to: 
    • seek refunds from the Ministry, and
    • refund customers, when applicable
  • monitor announcements concerning refund mechanisms, pending completion of industry consultation with the Saskatchewan Ministry of Finance 

 

Contact us

Brent Murray

Partner, PwC Law LLP

Tel: +1 416 947 8960

Tariq Nasir

Senior Manager, PwC Canada

Tel: +1 416 815 5320

Sarah Noftell

Senior Manager, PwC Canada

Tel: +1 416 815 5260

Mario Seyer

Partner, PwC Canada

Tel: +1 514 205 5285

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