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: Taxation of Foreign Service Directive - Maternity Leave
Position: Non-taxable.
Reasons: The maternity leave is based on other non-taxable foreign services allowances. (We looked at versions of the other allowances in 1996.) These allowances are not taxable pursuant to subparagraph 6(1)(b)(iii).
Canadian High Commission
Commonwealth Avenue
Canberra ACT 2600 5-990219
Australia Karen Power, CA
Attention: Stefanie Beck
February 8, 1999
Dear Ms. Beck:
Re: Taxation of “Maternity Allowance”
We are writing in reply to your correspondence of October 21, 1998, which was forwarded to our Division for reply by the Ottawa Tax Services Office. You have requested our views on whether the Foreign Service Directive (“FSD”) - Maternity Leave Allowance (FSD 69.07) is taxable.
It is our understanding that the maternity leave allowance is provided to employees on maternity leave and is based on the individual’s actual entitlement to FSD 55, 56 and 58 which they would not otherwise receive due to their being on maternity leave.
Since the allowances provided under FSD 55, 56, and 58 are exempt from taxation pursuant to subparagraph 6(1)(b)(iii) of the Income Tax Act (the “Act”) (provided these FSD’s are in substantially the same format as the versions reviewed by this
Directorate as at December 31, 1996), it is our view that the maternity leave allowance FSD 69.07 should follow the tax status of the allowances on which it is based, and will be considered non-taxable.
We trust our comments will be of assistance to you.
Yours truly,
Roberta Albert, CA
for Director
Business and Publications Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch
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