Income Tax Severed Letters - 1996-04-05

Principal Issues:

Whether sabbatical leave plan meets requirements of Reg. 6801(a).

Position:

No opinion on acceptability but note that interest income paid in year is considered employment income.

Reasons:

Principal Issues:

Eligible transferee election under section 80.04

1)Company controlled by shareholders of debtor + a stranger (1/3)
2)Company controlled by wives of shareholders of debtor

Position:

1)Yes
2)Question of fact, probably No

Reasons:

Principal Issues:

Whether dividends received from an insurance corporation exempt from Part I tax under paragraph 149(1)(t) would qualify for the deduction under subsection 112(1) when a portion of the insurance corporation's income is subject to tax by virtue of subsection 149(4.1).

Position:

No.

Reasons:

Principal Issues:

Whether or not a college is continuing the business of the private and hospital-affiliated schools of nursing. It would have to be determined whether the private and hospital-affiliated schools were in facts businesses for purposes of the Act. This is a question of fact that can only be determined on a ruling basis (see office analysis).

Position:

If they were businesses the college would be continuing business for purposes of 60(j.1)(iv) of the Act. Gave general position with respect to retiring allowance.

Reasons:

Principal Issues:

the use of subleasing arrangement to avoid the application of the standby charge rules

Position:

the article referred to paraphrases our response at the 1992 TEI conference

Reasons:

Principal Issues:

Are share acquired in "ordinary course of Business"

Position:

Guidelines - case by case

Reasons:

Principales Questions:

Est-ce que l'article 80 s'applique lorsque le créancier détient la totalité des actions du débiteur et qu'il y a règlement de la dette par l'émission d'actions du débiteur.

Position Adoptée:

Principal Issues:

Meaning of a "periodic pension payment" in section 5 of the Income Tax Conventions Interpretation Act (the "ITCIA") for payments out of a RRIF.

Position:

See example in letter.

Reasons:

Principal Issues:

Whether a payment to a U.S. resident under a licensing agreement for the right to use, on a one-time basis, commercial information that consists of basically a customer list, would constitute a "Franchise or Rental Agreement".

Position:

No.

Reasons:

Principal Issues:
Whether the selling of shirts, hats, jackets, etc. by a labour organization will affect its exempt status under 149(1)(k) of the Act.

Principal Issues:

tax consequences to employees and their beneficiaries arising from a fund set up to pay a death benefit as defined in the Act

Position:

plan will likely be an ebp but no amt will be included in the employee's income by reason of the plan, the beneficiary will only be taxed to the extent of 56(1)(a)(iii) and the employer will not get a deduction until the amount is paid out of the plan to a beneficiary as a death benefit

Reasons:

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.

									952848
XXXXXXXXXX							Cal Brown
(613) 957-8980

Attention: XXXXXXXXXX

March 18, 1996

Dear Sirs:

Re: Partnership Guarantee

Principal Issues:

Principal Issues:

Charitable foundation issuing annuities

Position:

Comments in IT-111R2 relate to charitable organization as distinct from charitable foundation.

Reasons:

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.

									952388
XXXXXXXXXX							Tim Kuss

Attention: XXXXXXXXXX

March 6, 1996

Dear Sirs:

Re: Application of Subsection 20(11) to Income from a Non-Resident Trust

Principal Issues:

Whether amount received to terminate a rental revenue guarantee agreement pursuant to which vendor of property guaranteed minimum rent is taxable.

Position:

Amount likely taxable.

Reasons:

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.

									Cal Brown
XXXXXXXXXX							(613) 957-8980
									952658

Attention: XXXXXXXXXX

January 18, 1996

Dear Sir\Madam:

Re: Canadian Video or Film Production - Tax Credit

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.

									951810
XXXXXXXXXX							Cal Brown
(613) 957-8980

Attention: XXXXXXXXXX

July 19, 1995

Dear XXXXXXXXXX:

This is in reply to your facsimile transmission of July 11, 1995 concerning a proposed amendment to certificates of limited partnerships.