Income Tax Severed Letters - 1997-01-24

Miscellaneous

16 January 1997 9635791 - DEATH BENEFIT PLAN

Unedited CRA Tags
6(1)(g) 149(1)(f) 75(2) 56(1)(a)(iii)

Principal Issues:

Whether death benefit plan is employee benefit plan or what other tax consequences might occur re earnings and contributions from and payments to employers; whether "death benefit" can be paid on death of spouse of employee.

Position:

Not an EBP and no tax consequences; can be a "death benefit" if spouse predeceased by employee.

Reasons:

Ruling

30 November 1995 Ruling 9635673 - DPS FINANCING

Unedited CRA Tags
248

Principal Issues:

DPS Financing- Small change requested

Position:

Accept

Reasons:

Technical Interpretation - External

17 January 1997 External T.I. 9635315 - ASSIGNMENT OF A HOUSING LOAN AFTER APRIL 26, 1995

Unedited CRA Tags
15(2.4)

Principal Issues:

whether the assignment of a housing loan after April 26, 1995
that was previously exempt from inclusion under 15(2) will still
qualify for the exemption after the assignment

Position:

not likely

Reasons:

16 January 1997 External T.I. 9637505 - OPTION TRANSACTIONS

Unedited CRA Tags
49

Principal Issues:

Taxpayer requesting information on option
transactions and treatment for tax purposes

Position:

General explanation and discussion

Reasons:

16 January 1997 External T.I. 9640735 - TRANSFER OF RRSP ANNUITY PAYMENTS TO SPOUSE

Unedited CRA Tags
160(1) 74.1(1)

Principal Issues:

Whether RRSP annuity payments made directly to the bank
account of the annuitant's spouse are considered to be a
transfer of property subject to the provisions of
subsection 160(1).

Position:

Yes.

Reasons:

14 January 1997 External T.I. 9642255 - QUALIFIED INVESTMENT, CO-OP CORP

Unedited CRA Tags
146(1) 4900(1)(h)

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.

964225
XXXXXXXXXX M.P. Sarazin

Attention: XXXXXXXXXX

January 14, 1997

Dear Sirs:

Re: XXXXXXXXXX

9 January 1997 External T.I. 9641515 F - PUBLICATION DEC.ANT.

Unedited CRA Tags
2

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.

5-964151
XXXXXXXXXX M. Shea-DesRosiers

Le 9 janvier 1997

Madame,

Objet: Publication des décisions anticipées

9 January 1997 External T.I. 9637535 - CAPITAL INTEREST DISTRIBUTION

Unedited CRA Tags
107(2)
Summary Under
Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1)
Summary Under
Tax Topics - Income Tax Act - 101-110 - Section 107 - Subsection 107(2)

Principal Issues:

1. Whether the provisions of subsection 107(2) will
apply to a distribution of property to a
beneficiary who has contingent capital interests by
virtue of capital encroachment provisions
2. Whether the provisions of subsection 107(2) will
apply where the trustee makes a distribution which
is in breach of trust
3. Whether 105(1) will apply to a distribution of
property which is subject to the provisions of
subsection 107(2)

Position:

1 and 2.
Subsection 107(2) applies where property is
distributed in satisfaction of a beneficiary's
capital interest in the trust.
3. No

Reasons:

8 January 1997 External T.I. 9641005 - MORTGAGE INVESTMENT CORP

Unedited CRA Tags
130.1

Principal Issues:

does "mobile home" meet def of house in National housing
act, for purposes of being qualified as a mortgage
investment corp.

Position:

Qof f . should contact CMHC

Reasons:

7 January 1997 External T.I. 9639715 - INTEREST PAID ON RRSP INVESTMENTS

Unedited CRA Tags
146

Principal Issues:

Reporting of amounts out of an RRSP

Position:

Routine explanations provided

Reasons:

6 January 1997 External T.I. 9640845 - TRUST AND ARM'S LENGTH DEALINGS

Unedited CRA Tags
251
Summary Under
Tax Topics - Income Tax Act - Section 251 - Subsection 251(1) - Paragraph 251(1)(c)
2 trusts not necessarily NAL if they share a common trust company as trustee

Principal Issues:

Whether two trusts are considered to be dealing arm's length
notwithstanding that they have the same financial institution as
trustee.

Position:

The fact that two trusts have the same financial institution as
trustee will not, in and by itself, be sufficient to conclude
that these two trusts are not dealing at arm's length.

Reasons:

23 December 1996 External T.I. 9640045 - RRSP INVESTMENT IN SMALL BUSINESS

Unedited CRA Tags
REG 4900

Principal Issues:

How can RRSP invest in small business.

Position:

Routine reply sent to taxpayer as requested.

Reasons:

23 December 1996 External T.I. 9635945 - ELECTROLYSIS AS A MEDICAL EXPENSE

Unedited CRA Tags
118.2(2)

Principal Issues:
Whether or not payment made to an electrologist for
electrolysis treatment recommended by a physician qualifies as
a medical expense

Position:
No

Reasons:
Subsection 118.2(2) is specific as to what procedures qualify
as a medical expense when prescribed by a medical
practitioner. Electrolysis is not one of them.

17 December 1996 External T.I. 9635295 - INTEREST ON QUARTERLY INSTALMENTS

Unedited CRA Tags
161(2) 161(4.01) 163.1

Principal Issues:

Determination of the minimum quarterly instalment for an
individual.

Position:

Outlined the steps to arrive at the minimum quarterly amount.

Reasons:

17 December 1996 External T.I. 9636055 - Personal Services Business

Unedited CRA Tags
SCH 125(7)
Summary Under
Tax Topics - Income Tax Act - Section 125 - Subsection 125(7) - Personal Services Business

Principal Issues:

Personal Services Business and whether a person includes
a foreign corporation

Position:

A foreign corporation is a person and a corporation for
purposes of the Act

Reasons:

17 December 1996 External T.I. 9640875 F - FIDUCIE EXCLUSIVE AU CONJOINT- REGLE 21 ANS

Unedited CRA Tags
104(4)a) 107(2) 104(5.3)

Principales Questions: regle 21 ans

Position Adoptée:explication 104(4) et 107(2)

16 December 1996 External T.I. 9640405 - INCOME DETERMINATION

Unedited CRA Tags
9

Principal Issues: income determination

Position:closing inventory

Reasons:

6 December 1996 External T.I. 9639795 F - TRAVAILLEUR INDÉPENDANT VS EMPLOYE

Unedited CRA Tags
9

Principales Questions:

distinction entre tavailleur independant et employe

Position Adoptée:

3 December 1996 External T.I. 9636705 - DEEMED GAINS AND ARTICLE XXII CAN/US TREATY

Unedited CRA Tags
107(5)
Summary Under
Tax Topics - Treaties - Income Tax Conventions - Article 22

Principal Issues:

Whether the deemed gain resulting from the application of
subsection 107(5) would be exempt from withholding tax by virtue
of Article XXII of the Canada-U.S. Tax Convention.

Position:

No.

Reasons:

6 January 1996 External T.I. 9640805 - TRUST AND CAPITAL GAIN

Unedited CRA Tags
104(21)

Principal Issues:

How should capital gains earned on the residue of an estate be
taxed where a trust indenture does not specify that capital gains
are income of the trust ?

Position:

Those trusts that do not specify that capital gains are income of
the trust have their capital gains considered as part of the
trust capital under trust law and if such a trust realizes a
capital gain or a deemed capital gain, the taxable amount thereof
cannot be paid or payable to a beneficiary and thereby be
included in income unless the amount was received by way of
capital encroachment.

Reasons:

Technical Interpretation - Internal

8 January 1997 Internal T.I. 9634777 - PUBLIC TRUSTEE FEES

Unedited CRA Tags
18(1)(a) 18(1)(b) 9 20(1)(bb) 67
Summary Under
Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(bb)

Principal Issues:

Public trustee fees deductible as carrying expenses?

Position:

Depending on the facts

Reasons:

7 January 1997 Internal T.I. 9640757 F - RENONCIATION IMPOT PARTIE X.1

Unedited CRA Tags
204.1(4)

Position Adoptée:

20 December 1996 Internal T.I. 9640447 F - RÉSIDENCE D'AGRICULTEUR

Unedited CRA Tags
149(1)(t)

Position Adoptée:

3 December 1996 Internal T.I. 9636430 - INDIANS - EMPLOYMENT, INVESTMENT, BUSINESS INCOME

Unedited CRA Tags
81(1)(a)

Principal Issues:

Ministerial Letter

7 January 1997 Ministerial Letter 9633768 - MEALS AT A GOLF COURSE

Unedited CRA Tags
18(1)(l) 67.1

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.

MINISTER/DEPUTY MINISTER'S OFFICE 96-05554M
ADM'S OFFICE
RETURN TO 15TH FLOOR, ALBION TOWER

January 7, 1997

XXXXXXXXXX

Dear XXXXXXXXXX:

13 December 1996 Ministerial Letter 9634498 - AUDITOR GENERAL'S REPORT ON FAMILY TRUSTS

Unedited CRA Tags
104(1)

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.

MINISTER/DM'S OFFICE 6-07128M
ADM'S OFFICE
RETURN TO RULINGS, 15TH FLOOR, ALBION TOWER
PENDING

December 13, 1996

XXXXXXXXXX

Dear XXXXXXXXXX:

11 December 1996 Ministerial Letter 7M12778 - BUSINESS INCOME OF CURLERS

Unedited CRA Tags
9

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.

RESPONSE TO A CBC CLIP ON WINNINGS OF TOP CURLERS

1 December 1996 Ministerial Letter 6M12708 - FOLLOW-UP QUERIES RE AG REPORT

Unedited CRA Tags
107(5)

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.

December 1, 1996

6m1270

Q-87--September 26, 1996--XXXXXXXXXX

With respect to family trusts:

(a)exactly how many family trusts have been recognized by Revenue Canada since 1972;

1 December 1996 Ministerial Letter 6M12718 - FOLLOW-UP QUERIES RE AG REPORT

Unedited CRA Tags
107(5)

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.

December 1, 1996

e6m1271

Q-88--September 26, 1996--XXXXXXXXXX

What is the impact on the Canadian tax system of the shortfall since 1972, per year, from the establishment of family trusts?

A-88

1 December 1996 Ministerial Letter 6M12728 - FOLLOW-UP QUERIES RE AG REPORT

Unedited CRA Tags
107(5)

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.

December 1, 1996

e6m1272

Q-89--September 26, 1996--
XXXXXXXXXX

With respect to family trusts: