Income Tax Severed Letters

This Week's Release

Ministerial Correspondence

13 July 2017 Ministerial Correspondence 2017-0700121M4 - Deductibility of foreign online advertising

Unedited CRA Tags
19; 19.01 & 19.1

Principal Issues: Is foreign online advertising deductible?

Position: Generally, foreign online advertising is deductible.

Technical Interpretation - External

21 June 2017 External T.I. 2016-0678361E5 F - Capital Dividend Account

Unedited CRA Tags
89(1), 40(3.1), 96(1), 102(2)

Principales Questions: Under the presented scenario, whether a deemed gain under subsection 40(3.1) realized by a partnership can be included in the CDA of its corporate limited partner.

Position Adoptée: No.

Raisons: Our position is that generally the partnership's income retains its characteristics as to source and nature when allocated to the partners.

22 March 2017 External T.I. 2016-0666481E5 - Debt forgiveness in a tiered partnership

Unedited CRA Tags
80(15); 102(2); 99(1)

Principal Issues: Will subsection 80(15) apply in a tiered partnership structure?

Position: Yes.

Reasons: Since section 80 must be applied to determine net income of a partnership, subsections 96(1) and 102(2) would apply to treat the partnerships as separate persons for purposes of section 80.

Technical Interpretation - Internal

28 April 2017 Internal T.I. 2017-0699741I7 - Phoenix - financial advisor funding

Unedited CRA Tags
6(1)(a)

Principal Issues: Is an employer reimbursement for tax-advisory-services expenses incurred due to employer payroll errors included in the employee's income?

Position: No

Reasons: See response

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