risks

The appellant (“Northbridge”) issued fleet insurance policies to trucking companies who operated their vehicles in both Canada and the U.S. The Tax Court had found that none of such supplies of insurance were zero-rated under Sched VI, Pt. IX, s. 2(d) on the basis that this provision referenced the ordinary location of the insured vehicles, and there was no evidence on that point – and accordingly confirmed the denial of Northbridge’s related input tax credit claims.

Before allowing the appeal, Webb JA stated (at paras. 34, 36 and 45):

The appellant issued fleet insurance policies to trucking companies who operated their vehicles in both Canada and the US. The appellant claimed input tax credits on the basis that 1/3 of its supplies of insurance were zero-rated under Sched VI, Pt. IX, s. 2(d). The 1/3 figure came from its historical analysis that 1/3 of its payouts under the policies it issued respected perils that arose in the U.S.