Income Tax Severed Letters - 2006-04-21

Ruling

2006 Ruling 2005-0165091R3 F - Paid-up Capital Reduction - Public Corporation

Unedited CRA Tags
84(2) 84(4.1) 53(2) 40(3)

Principal Issues: Whether subsection 84(2) applies to the proposed distribution of shares of a subsidiary corporation, to be effected as a reduction of the stated capital of a public corporation.

Position: Favourable rulings provided.

Reasons: In compliance with the law and previous positions.

2006 Ruling 2006-0167921R3 - XXXXXXXXXX

Unedited CRA Tags
75(2) 149(1)(c) 107(2) 104(6)(b)

Principal Issues: See Ruling and Statement of Principal Issues.

Position: See Ruling and Statement of Principal Issues.

Reasons: See Ruling and Statement of Principal Issues

Technical Interpretation - External

20 April 2006 External T.I. 2005-0155961E5 - Private Health Services Plan

Unedited CRA Tags
18(1)(e) 6(1)(a)(i) 118.2(2)

Principal Issues: Whether an employer's contribution to a claim stabilization fund (a separate bank account), as required by a contract with a third-party plan administrator of a PHSP, is deductible.

Position: No.

Reasons: Paragraph 18(1)(e). Also, the fund is maintained for the ultimate benefit of the employer; no expense is incurred until an amount is paid or payable from the fund pursuant to the terms of the PHSP.

20 April 2006 External T.I. 2006-0166961E5 - Medical Expenses, Private Health Clinic Access Fee

Unedited CRA Tags
118.2(2) 6(1)(a)(i)

Principal Issues: Does a fee paid to a private health clinic as a "membership" or "access" fee qualify as a medical expense for purposes of the medical expense tax credit and the definition of "private health services plan"?

Position: No.

Reasons: The fee is paid for access to medical services rather than for medical services themselves. The fee is not being paid with respect to any existing medical condition or concern. The fee does not relate to any medical service actually provided by the clinic, as the individual must pay for such services on top of the membership fee paid.

18 April 2006 External T.I. 2005-0163351E5 - Payroll Deductions and Tips

Unedited CRA Tags
153(1)

Principal Issues: Are payroll deductions required for pooled tips distributed by the employer to employees?

Position: General comment provided.

Reasons: General Comments.

12 April 2006 External T.I. 2006-0167941E5 - Film Tax Credit - CCA and Beneficial Ownership

Unedited CRA Tags
125.4 class 10(1)(x)

Principal Issues: Request to confirm their understanding of the tax treatment of certain fees received by a producer in respect of a particular production.

Position: Confirmed that there would be no double counting of the amount received or paid.

Reasons: Reading of the law.

11 April 2006 External T.I. 2006-0167391E5 - Medical Expense Tax Credit - Moving Expenses

Unedited CRA Tags
118.2(2)(l.5)

Principal Issues: Whether moving expenses can be claimed in computing income taxes.

Position: Certain moving expenses may be claimed in computing medical expense tax credit if the individual has a severe and prolonged mobility impairment, if new dwelling is more accessible or if individual is more mobile or functional within new dwelling. Expenses must be evidenced by receipt.

Reasons: Paragraph 118.2(2)(l.5).

22 March 2006 External T.I. 2006-0168491E5 F - Vente de compte-clients et d'achalandage

Unedited CRA Tags
22 24
Summary Under
Tax Topics - Income Tax Act - Section 22 - Subsection 22(1)
capital loss treatment if a s. 22 election is not made

Principal Issues: Traitement fiscal à être accordé à un montant global reçu par un conseiller en placement suite à la vente de ses actifs d'entreprise tels que créances, liste des comptes-clients, achalandage et droit de recevoir des commissions si renouvellement des polices d'assurance.

Position: Aucune.

Reasons: Commentaires généraux

Technical Interpretation - Internal

18 April 2006 Internal T.I. 2006-0176531I7 - Commission Income Assigned to a Corporation

Unedited CRA Tags
9(1) 5

Principal Issues: Whether a mutual fund salesperson can assign commission income to a corporation under the Income Tax Act.

Position: Question of fact.

Reasons: There are exceptions to the strict enforcement of the Ontario Securities Act in terms of whether or not the corporation must be registered. The Ontario Securities Commission, in conjunction with certain regulatory bodies, will allow non-registered corporations to have a salesperson trading on its behalf through a registered dealer under certain circumstances.

11 April 2006 Internal T.I. 2006-0169571I7 F - Provision pour recours collectif

Unedited CRA Tags
1400(3) Reg 1408 Reg
Summary Under
Tax Topics - Income Tax Regulations - Regulation 1408 - Subsection 1408(1) - Claims Liability - Paragraph (a)
reserve could be set up for class action suit

Principales Questions:
Le montant calculé selon l'élément D du paragraphe 1400(3) du Règlement peut-il inclure un montant pour une provision pour recours collectif?

Position Adoptée:
Oui.

Raisons:
Analyse législative.

7 April 2006 Internal T.I. 2006-0170201I7 - MURBs and partnerships

Unedited CRA Tags
Class 31 and 32 70(5)

Principal Issues: Whether an interest in a MURB must be treated as an interest in a partnership.

Position: Not always. It is a question of fact whether the MURB is owned by a partnership or directly.

Reasons: Reading of the law.