Income Tax Severed Letters - 1997-12-12

Principales Questions:

Questions sur 20(1)(c) pour divers scénarios d'achat d'actions ordinaires et la position du IT-315..

Position Adoptée:

Principales Questions:

1. Est-ce que le Ministère reconnaîtrait une disposition d'actions dans un genre de situation spécifique?

2. Quelles sont les formalités pour démontrer que les conditions du sous-alinéa 50(1)b)(iii) de la Loi sont réunies?

Position Adoptée:

Principal Issues:

Whether membership fees in a golf club are deductible.

Position:

No.

Reasons:

Principal Issues:

Whether, in a particular situation, the corporation would be entitled to a small business deduction (up to $200,000) in the current year with respect to the amount of the reserve included in income pursuant to subsection 34.2(5) of the Act that exceeds the corporation's share of the loss of the partnership.

Position:

In that particular situation, no.

Reasons:

Principal Issues:
An annuitant's RRSP holds a mortgage on an arm's length person's home and the arm's length person's RRSP holds a mortgage on the annuitant's home, would the simultaneous reduction of the mortgages result in a withdrawal or benefit being received out of the RRSP?

Position:
Question of Fact.

Reasons:
Appears that the parties may not deal at arm's length and the mortgages will not qualify unless annuitants deal at arm's length so only general comments were provided.

Principal Issues:

Can an amount exempt from non-resident withholding taxes under 212(1)(h)(v) retain its exemption after being transferred from the RPP to an RRSP?

Position: No

Reasons:

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.

		970283
XXXXXXXXXX	M. Eisner

November 25, 1997

Dear XXXXXXXXXX:

Re: Charitable Donations

This is in reply to your letter of January 10, 1997 concerning the above-noted subject. We apologize for the delay in replying.

Principal Issues:

a)Does 7(1.4) apply where the value of new options does not exceed the value of the old.
b) Acceptance of a valuation procedure.
c) Timing of the non-arm's relationship in 7(1.4).

Position:

a)This is one of the criteria.
b) Referred to TSO valuations section.
c) Immediately before and after transaction per 7(1.4).

Reasons:

Principal Issues:

Is thee Income Tax Act Constitutional?

Position:Yes

Reasons:

Principal Issues:

Whether Plan meets requirements of section 6801 of the Regulations.

Position:

No

Reasons:

Principales Questions:

Un particulier exploite une entreprise pour laquelle travaille son conjoint. Il met son automobile à la disposition du conjoint pour son utilisation personnelle. Est-ce que le conjoint reçoit un avantage imposable pour l'usage et le fonctionnement d'une automobile qui doit être ajouté à son revenu d'emploi? Est-ce que le particulier peut déduire la totalité des dépenses d'automobile encourues?

Position Adoptée:

Principales Questions:

Dans une situation où la première mesure d’allègement transitoire s’applique à l’égard d’un logiciel acquis par une société de personnes, est-ce que les membres de la société de personnes seraient visés par les nouvelles règles proposées sur les abris fiscaux (logiciels) et est-ce que ces nouvelles règles s’appliqueraient à un contribuable qui est membre d’une société de personnes du seul fait que le contribuable soit devenu membre de la société de personnes à une date subséquente au 6 août 1997.

Position Adoptée:

Principal Issues:

Questions on RCA refundable tax and the lending of RCA funds to a contributing employer.

Position:

Directed writer to relevant provisions of the RCA Guide and noted position that could be developed concerning lending of funds contributed to an RCA.

Reasons:

Principal Issues:

Can any legislative or administrative relief be provided to reduce the tax burden where an underpayment of prior year pension benefits is paid in one year?

Position:

No.

Reasons:

Principales Questions:

Un bâtiment en pans de bois fait-il partie de la catégorie 6 s'il est érigé sur une base de béton de 6 pouces d'épaisseur posée sur le sol avec une bordure de 10 à 12 pouces d'épaisseur?

Position Adoptée:

Principal Issues:

Whether modification to issuer's redemption powers causes shares to become "short-term preferred shares".

Position:

Question of fact.

Reasons:

Principal Issues:

Venture Capital corporations Criteria

Position:

Case by case review

Reasons:

Principales Questions:

Est-ce que le contribuable peut réclamer un don de bienfaisance en vertu de l'article 118.1 de la Loi à l'égard des primes d'une police d'assurance-vie si le contribuable donne la couverture de base de cette police à un organisme de bienfaisance et désigne son conjoint comme bénéficiaire irrévocable pour tous les avenants de la police excédant la couverture de base?

Position Adoptée:

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.

		972992
XXXXXXXXXX	B. Kerr

Attention: XXXXXXXXXX

November 13, 1997

Dear Sirs:

Re: Interpretation Bulletin IT-148R3
Recreational Properties and Club Dues

Principal Issues:

Whether individuals who suffer from Hepatitis C and file a claim for damages can be regarded as having made a claim "in respect of personal injury or death" (one of the condition set out in paragraph 5 of IT-365R2).

Position:

Such a claim could satisfy that condition. However, it is necessary to review all the relevant facts and documentation to determine whether periodic payments are non-taxable by virtue of the general position in paragraph of IT-365R2.

Reasons:

Principales Questions:

admissibilité des coûts de rénovations au CII

Position Adoptée:

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.

		972565
XXXXXXXXXX	B. Kerr

Attention: XXXXXXXXXX

November 10, 1997

Dear Sir:

Re: Interpretation Bulletin IT-148R3
Recreational Properties and Club Dues

Principales Questions:

application subsection 105(1) of the Act where a corporation is the beneficiary of a life insurance policy but a trust is the policyholder

Position Adoptée:

Principal Issues:

Whether subsection 15(1) would apply in a situation where a shareholder exchanges his shares in a corporation pursuant to 51(1) or 86(1) for other shares of the corporation with a fair market value in excess of the fair market value of the original shares. The corporation has one other shareholder and the shareholders are unrelated.

Position:

Yes and paragraph 69(1)(b) could also apply to deem that the other shareholder has disposed of part of his economic interest.

Reasons:

Principales Questions:

1. Est-ce que certains véhicules décrits sommairement seraient considérés comme des automobiles aux fins de la Loi?

2. Demande de détails concernant l'exclusion de l'alinéa 248(1)d) de la définition du terme "automobile" pour certains véhicules à moteur de type pick-up ou fourgonnette ou d'un type analogue.

Position Adoptée:

Principales Questions:

Dans quelles situations la pénalité prévue au paragraphe 163(1) de la Loi s'applique-t-elle?

Position Adoptée:

Principal Issues:
When can a commissioned sales employee (who earns both commission income and salary income) choose to apply paragraph 8(1)(f) as opposed to 8(1)(h), (h.1), or (i) of the Act?

Position:
If employee chooses 8(1)(h) and/or (h.1), cannot claim deduction for any expense under 8(1)(f). In this case, home office expenses would have to be claimed under 8(1)(i)(ii) and (iii).

Reasons:
Because of mutual exclusivity imposed by 8(1)(h)(iv) and 8(1)(h.1)(iv).

Principal Issues:

The classification of a dyke and the income tax consequence of Government assistance for constructing such a dyke.

Position:

Dyke is a class 1 property. Government assistance reduces the capital cost of the dyke.

Reasons:

Principal Issues:

(1) Status Indian employee of a reserve-based organization: whether duties performed on a reserve but only "constitute approximately XXXXXXXXXX% of the services provided" are enough for tax exemption under Guideline 3.

(2) Whether tax exemption under Guideline 4 available.

Position:

(1) Exemption cannot be granted.

(2) Exemption cannot be granted.

Reasons:

Principales Questions: