Guide to Administering Low-Value Amounts

The regulations specify that the amount owed is zero if “deemed to be nil.” An amount is deemed to be nil if an appropriate Minister, or any other person authorized by that Minister, determines the following are at, or below the threshold established by the regulations:

• an amount owing by a person to the government (for example, receivables), or
• an amount payable by the government to a person (including public sector employees)

For receivables, if the amount is zero, there is nothing to collect and nothing to write off. Therefore, the Debt Write-Off Regulations do not apply.

The same principles apply for payables. Any amount payable by the government that is deemed to be nil is zero.

Once an amount is deemed to be nil, it should be removed from accounting records according to the accounting instructions referred to in section 6 of this guide.

In accordance with subsection 155.2(3) of the FAA, if a low-value amount is not collected or paid (receivable or payable) because it is deemed nil, any requirements related to that amount are considered to be met. For example, making no payment of a low-value amount is not considered to be in default of a contract. No interest is owed on a low-value amount that has been deemed nil, so no interest is collected or paid.

In accordance with subsection 155.2(4) of the FAA, if a low-value amount is not paid (for payables only) because it is accumulating, any requirements related to that amount are considered to be met while it is accumulating (see sections 5.2 to 5.4 of this guide). The amount is not subject to interest during the accumulation period.

In accordance with subsection 155.2(5) of the FAA, section 155.2 of the FAA and the regulations supersede any provision of any act of Parliament, regulation, order, contract or arrangement, to the extent of any inconsistencies between these instruments. For example, a department has a contract with a supplier that specifies all amounts are to be paid. In accordance with section 155.2 of the FAA, low-value amounts at or below the applicable threshold would be deemed nil and not paid.

In accordance with subsection 155.2(6) of the FAA, certain amounts are not subject to the low-value amounts legislation as follows:

• amounts owed by a third party^{Footnote 1} to a Crown corporation or amounts owed by a Crown corporation to a third party
• amounts related to public debt or interest on public debt
• amounts owed to or by the government under certain tax statutes^{Footnote 2}

The regulations list other exemptions (see section 5.4 of this guide).

The regulations do not apply to public debt or interest on public debt. In the context of paragraph 155.2(6)(b) of the FAA, public debt refers to the payment of principal and interest related to Canada’s outstanding debt obligations and reflects the borrowing authorities outlined in Part IV of the FAA. For example, low-value amounts for Canada Savings Bonds are included in the definition of “public debt.” Therefore, related bond payables or bond interest amounts of $2.00 or less must be paid. However, payments owed to suppliers, including any interest, are not covered in the definition of “public debt” and are subject to the $2.00 threshold.

The regulations establish two fixed thresholds for low-value amounts owed to or by the government as follows:

• $0.99 for payments under the Canada Pension Plan, Employment Insurance Act, Old Age Security Act and any associated regulations made under these acts
• $2.00 in any other case

An “accumulation of a payable” occurs when an amount at the applicable threshold or lower is held for a prescribed period of time until it:

• exceeds the threshold (due to the addition of the same type of payable for the same recipient) and is paid or
• does not exceed the threshold and is deemed nil

The regulations require specific types of payables to be accumulated when below the threshold over a period of time and paid, or thereafter deemed nil, as detailed below under section 5.3. There are no provisions in the regulations to accumulate low-value receivables. Apart from those specifically detailed in the regulations, all other payables and receivables should be deemed nil when they are at or below the applicable threshold.

According to the regulations, only specific types of payments must be accumulated, as detailed in the following table.

The following provides additional details on interest receivable and payable and also on the combination of low‑value payables.

For amounts that are required to accumulate (see section 5.2 of this guide), only amounts payable to the same recipient that are of the same type or payable under the same program, legislation or regulation may accumulate.

For example, low-value amounts owed to John Smith have accumulated for the Canada Pension Plan ($0.50) and the Old Age Security Guaranteed Income Supplement ($0.55). Both types of low-value amounts accumulate as described in the regulations, paragraph 3(1)(a). However, during the accumulation periods, the two low-value amounts cannot be combined to exceed the $0.99 threshold and paid, because they are not the same type of payment.

In addition to the exceptions listed in section 4.4 of this guide, the following items are exempt from the application of low-value amounts thresholds, as outlined in section 4 of the regulations:

• amounts payable by or to the Crown in currencies other than Canadian dollars (for example, an invoice of US$0.50 from a non-Canadian supplier would not be deemed nil and would be paid)
• service fees as defined by section 2 of the Service Fees Act
• immediate payments in exchange for goods and services
• amounts that are requested in writing by the recipient, if the request is sent to the appropriate Minister within 12 months after the day on which the amount becomes payable

In accordance with paragraph 4(d) of the regulations, a recipient may request payment of a low-value amount. The request must be made in writing to the appropriate Minister within 12 months after the day on which the amount becomes payable.

To satisfy the requirements of paragraph 4(d), it is sufficient if the request is addressed to the Minister and is sent to the Minister’s department. It is up to the department to put in place any necessary departmental procedures to handle the written request once it is received by the Minister.

Public Services and Procurement Canada’s Accounting, Banking and Compensation Branch has the exclusive authority for the Government of Canada to print cheques for requested low-value priority payments. The Receiver General Directive 2016-2 provides specific instructions for departments to request payment of low-value amounts in accordance with paragraph 4(d) of the regulations.

A low-value amount can be collected or paid in the following circumstances:

• it is one of the exceptions or exemptions listed in sections 4.4 or 5.4 of this guide, including a payment being requested, as outlined in paragraph 4(d) of the regulations
• the type of payable is required to accumulate, and the accumulated amount exceeds the threshold within the accumulation period
• it is combined in a single payment of other invoices, due within the same week, with the total exceeding $2.00
• the low-value amount is owed by one department to another department (an interdepartmental settlement)

• Financial Administration Act, Subsection 155.2
• Low-ValueAmounts Regulations

• Directive on Public Money and Receivables
• Directive on Payments

• Receiver General Directive 2016-2, “Printing priority Receiver General cheques at departmental sites and Public Services and Procurement Canada’s print sites”
• Receiver General Manual, Chapter 10, Accounting Entries, Section 10.13