Income Tax Severed Letters - 2020-04-15

Ruling

2019 Ruling 2018-0757561R3 - Payment in lieu of continued WLRP payments

Unedited CRA Tags
5(1); 6(1); 6(1)(f); 6(3)
Summary Under
Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(f)
lump sums received in settlement of future wage loss disability benefits were exempt
Summary Under
Tax Topics - Income Tax Act - Section 6 - Subsection 6(3) - Paragraph 6(3)(b)
residual payments out of a disability trust were employment income

Principal Issues: (1) Whether a lump sum payment out of a health and welfare trust in lieu of continued wage loss replacement plan benefits is required to be included in income? (2) Whether an additional lump sum payment out of the trust representing the distribution of remaining assets, if any, in the trust is required to be included in income?

Position: (1) No, consistent with established jurisprudence in respect of such settlement payments. (2) Yes, as the payment represents a taxable benefit from employment.

Reasons: See reply.

Technical Interpretation - External

17 January 2020 External T.I. 2017-0685341E5 - Tax Comparison of the FIT & Net Metering Programs

Unedited CRA Tags
s. 1100(24); 1100(25); 1100(26), 1102(1)(c); Class 43.1, 43.2
Summary Under
Tax Topics - Income Tax Act - Section 9 - Computation of Profit
a credit generated by a business under the Ontario Net Metering Program is only income when applied, and is offset by a deduction for the electricity consumed
Summary Under
Tax Topics - Income Tax Act - Section 3 - Paragraph 3(a) - Business Source/Reasonable Expectation of Profit
credits received under the Ontario Net Metering Program respecting electricity generated for personal consumption are not income
Summary Under
Tax Topics - Income Tax Regulations - Schedules - Schedule II - Class 43.1
general Class 43.1 or 43.2 treatment of specified energy property rules to equipment used in the Ontario Feed-in Tariff program
Summary Under
Tax Topics - Income Tax Regulations - Regulation 1100 - Subsection 1100(25)
application of exception to the specified energy property rules to equipment used in the Ontario Feed-in Tariff program

Principal Issues: What are the income tax consequences for participants in the Ontario FIT/microFIT and Net Metering Programs?

Position: See below.

Reasons: Application of the law.

2 January 2020 External T.I. 2018-0740791E5 - Approved Research Institute

Unedited CRA Tags
37(1)(a)(ii), 37(7), 248(1)

Principal Issues: "Approved" status requested for XXXXXXXXXX.

Position: Approval recommended.

Reasons: Information submitted meets the conditions for approval as set out in SR&ED Third Party Payments Policy which provides certain requirements to be met in respect of (a) SR&ED (b) facilities and personnel (c) non-profit status (d) the public as beneficiary and (e) adequate funding for the SR&ED activities.