18 March 2002 External T.I. 2002-0125385 - INTERNET ACCESS WHETHER EMPL BENEFIT

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

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

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

Principal Issues: Whether teachers are considered to receive a taxable employment when their employers provide them with high speed Internet at their homes to facilitate the teachers' work assignments.

Position: Question of fact.

Reasons: In making a determination, we would generally consider the reason the employer is paying or reimbursing the expense and who the primary beneficiary of this payment is. On that basis, it is our view that there are likely no significant taxable benefits to be reported by the teachers in the situation outlined.

XXXXXXXXXX 2002-012538
J. Gibbons, CGA
March 18, 2002

Dear XXXXXXXXXX :

We are replying to your letter, which we received on February 26, 2002, in which you requested our views whether teachers are considered to receive a taxable employment when their employers provide them with high speed internet at their homes.

As requested, we have considered your enquiry and have provided our views. However, our comments are of a general nature only since we cannot confirm the tax implications of particular transactions unless the transactions are proposed and are the subject matter of an advance ruling request submitted in the manner set out in Information Circular 70-6R4.

Facts

? The teachers have offices with Internet access at a school location.

? High-speed Internet access will be provided at the teacher's home to facilitate the teacher's work assignments.

? The employer will be billed directly for the Internet service to the teacher's home.

Our Comments

Except where the Income Tax Act provides otherwise, taxpayers are generally taxable on the value of all benefits they receive by virtue of their employment. Whether or not a taxable benefit is considered to be received by an employee as a result of an employer paying an expense on the employee's behalf is a question of fact that can only be determined on a case-by-case basis after reviewing all of the relevant facts. However, in making this determination, we would generally consider the reason the employer is paying or reimbursing the expense and who the primary beneficiary of this payment is. On that basis, it is our view that there is likely no significant taxable benefits to be reported by the teachers in the situation outlined.

We trust that these comments will be of assistance.

Yours truly,

John Oulton, CA
for Director
Business and Partnerships Division
Income Tax Rulings Directorate

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