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 Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
Principal Issues: Are elks "specified animals" for purposes of subsection 28(1.2) of the Act?
Position: No.
Reasons: "Specified animals" include horse and bovine animals registered under the Animal pedigree act. An elk is not considered a bovine animal.
5-981536
XXXXXXXXXX Karen Power, CA
(613) 957-8953
Attention: XXXXXXXXXX
September 2, 1998
Dear Sirs:
Re: “Specified Animals”
We are writing in reply to your letter of May 13, 1998 requesting our views on whether or not elks would be considered “specified animals” for purposes of subsection 28(1.2) of the Income Tax Act (the “Act”).
Paragraph 5 of Interpretation Bulletin IT-526 states that generally, inventory for purposes of the mandatory inventory adjustment will be valued in accordance with subsection 28(1.2) of the Act at the lesser of a) the amount paid by the farmer to acquire the inventory and b) its fair market value.
Subsection 28(1.2) of the Act, also provides that a farmer may choose to value a “specified animal” at 70% of its cash cost or at a greater amount not exceeding its cash cost.
A “specified animal” is defined in subsection 28(1.2) of the Act to include horse and bovine animals registered under the Animal Pedigree Act if the farmer so elects. An elk is a member of the Cervidea family and is not considered a bovine animal. In our view, elks would not be considered “specified animals” for purposes of subsection 28(1.2) of the Act.
Revenue Canada’s responsibility is limited to the interpretation of the Act. The Act would have to be amended in order to include elk in the definition of “specified animals”. As tax policy issues and amendments to the Act are the responsibility of the Department of Finance, any changes to the definition of “specified animals” would have to be considered by them.
We trust our comments will be of assistance to you.
Roberta Albert, CA
for Director
Business and Publications Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch
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