Income Tax Severed Letters - 1998-03-20

Miscellaneous

30 January 1998 9800651 - DEFINITION OF INVESTMENT PROPERTY

Unedited CRA Tags
REG 2405(3) 138(12) REG 2405(1)

Principal Issues:

An insurer holds 100% shares of Holdco1. Whether or not shares of Holdco1 are investment property to that insurer
a)where Holdco1 owns 100% of the shares of an insurance corporation
b) where Holdco1 owns 100% shares of another Holdco2 which in turn owns 100% of the shares of another insurance corporation.

Position:

Shares of Holdco1 are not investment property to the insurer.

Reasons:

Administrative Letter

30 November 1996 Administrative Letter 972932A - DPS AMENDMENT

Unedited CRA Tags
248(1)

Principal Issues:

Change in facts - minor amendments to the DPS Ruling letter.

Position: Granted

Reasons:

Ruling

30 November 1996 Ruling 9723603 - INTEREST DEDUCTIBILITY

Unedited CRA Tags
20(1)(c)

Principal Issues: additional facts

Position: ruling given

Reasons: for full disclosure

30 November 1996 Ruling 9724193 - BORROWING

Unedited CRA Tags
20(1)(c)

Principal Issues: amendment to ruling

Position: given sup

Reasons: full disclosure

30 November 1996 Ruling 9726573 - FOREIGN PROPERTY POOLED FUND TRUST

Unedited CRA Tags
206(1) REG 5000

Principal Issues:

A trust governed by a pension plan will be subject to Part XI tax if it holds more than 20% foreign property. Units of a pooled fund trust will not be foreign property if the fund holds 20% or less of its assets in foreign property. Accordingly a pension trust can hold 20% of its property in foreign investments and 80% of its assets in units of pooled fund trusts which hold 20% of their assets in foreign property, and not be subject to Part XI taxation..

Can a pension which holds units in a single pooled fund cause the fund to be split into two separate funds with one fund holding entirely foreign property and the other holding 20% foreign property?

Position:

Yes.

Reasons:

30 November 1996 Ruling 9729323 - DPS

Unedited CRA Tags
248(1)

Principal Issues:

Proposed issue of DPS. The issue of establishing financial difficulty was dealt with in 964033 which expired XXXXXXXXXX. There have been no significant changes in this regard. While the taxpayer has a very complex financial structure and the wording of the various agreements is more complicated than appears necessary the main new issue was whether a small portion of a dividend could be waived by a Schedule I Bank owning such DPS and not cause us to conclude that subsection 56(2) would apply to the holders of the DPS. The reason for the waiver for a portion of the dividend (included in the dividend formula) is that we have been advised that non-Schedule I Banks owning such shares have a higher cost of capital than a Schedule I Bank and would otherwise require a slightly higher rate of return. This may have been accomplished by issuing different classes of DPS shares (with different rates) but since at the time the identity (or quantity of DPS to be held) of all non-Schedule I Bank third party DPS purchasers was not known it was more expedient to do it this fashion.

Position:

DPS ruling provided - subsection 56(2) will not be applied.

Reasons:

30 November 1996 Ruling 9719633 - COST OF BORROWING

Unedited CRA Tags
20(1)(C)

Principal Issues:

deductibility of interest on borrowing to make distribution

Position:

cost of borrowing deductible

Reasons:

30 November 1996 Ruling 9722883 - BUTTERFLY REORGANIZATION

Unedited CRA Tags
55(3)(b)

Principal Issues:

Typical butterfly reorganization (split-up)

Position:

55(3)(b) rulings issued.

Reasons:

Technical Interpretation - External

17 March 1998 External T.I. 9725345 - MEDICAL EXPENSE - OVER-THE-COUNTER DRUGS.

Unedited CRA Tags
118.2(2)(n)

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.

		5-972534
XXXXXXXXXX		J. Gibbons
March 17, 1998

Dear XXXXXXXXXX:

12 March 1998 External T.I. 9804685 - DEBT FORGIVENESS - OPTIONAL REDUCTION OF TAX ATTRIBUTES

Unedited CRA Tags
80(5) 80(7) 80(2)(c)

Principal Issues:

Whether, given the ordering rule of paragraph 80(2)(c), a debtor can apply the remaining unapplied portion of the forgiven amount to depreciable properties and cumulative eligible capital in any order.

Position:

Although paragraph 80(2)(c) provides an ordering rule, certain reductions of tax attributes, such as reductions with respect to depreciable properties and cumulative eligible capital, are optional.

Reasons:

10 March 1998 External T.I. 9723495 - QUALIFIED FARM PROPERTY

Unedited CRA Tags
110.6(1)

Principal Issues:

Does farm property qualify as "qualified farm property?"

Position:

Not presently.

Reasons:

9 March 1998 External T.I. 9726965 - INDIAN ACT EXEMPTION

Unedited CRA Tags
81(1)(A)

Principal Issues:

Whether status Indian employees of a corporation are exempt from income tax.

Position:

Question of Fact

Reasons:

6 March 1998 External T.I. 9707125 - GRANDFATHERING RULES

Unedited CRA Tags
sch II Class 34

Principal Issues:

Class 34 par.(k), whether "acquired" in Draft Regulations released September 27, 1994 means "substantial completion"

Position:

Yes

Reasons:

6 March 1998 External T.I. 9713755 - REPLACEMENT PROPERTY - FORCED SALE OF SHARES

Unedited CRA Tags
44 54

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.

J. Gibbons
XXXXXXXXXX 971375

Attention: XXXXXXXXXX

March 6, 1998

Dear Sir:

5 March 1998 External T.I. 9703865 - RENTAL INCOME EARNED BY A PRIVATE FOUNDATION

Unedited CRA Tags
149.1(1)

Principal Issues:
a) Whether rental income can be earned by a private foundation
b) Whether rental income earned through a trust can be earned by a private foundation

Position:
a) Depends on the facts. See IT-434R for guidelines
b) Income earned from trust is trust income, not business income.

Reasons:
a) See IT-434 R; b) see 108(5) ITA

3 March 1998 External T.I. 9724025 - INDIAN ACT EXEMPTION

Unedited CRA Tags
81(1)(A)

Principal Issues:

Whether a portion of the employment income of an Indian for the retroactive period he was not working should be exempt from tax.

Position:

Yes

Reasons:

25 February 1998 External T.I. 9803195 F - TRANSFERT DE POLICE D'ASSURANCE-VIE

Unedited CRA Tags
148(8)(b)

Principales Questions:

Est-ce que les dispositions de roulement prévues au paragraphe 148(8) s'appliqueront dans une situation où la participation dans une police d'assurance-vie est transférée à l'enfant majeur du détenteur de la police suite au changement de vie assurée du parent à l'enfant tel que prévu par les termes de la police.

Position Adoptée:

24 February 1998 External T.I. 9723485 - gift of public traded secur&char. annuit.

Unedited CRA Tags
118.1

Principal Issues:

1) Can a taxpayer make a gift of publicly traded securities to a registered charity and request that the charity consider the total value of the securities to represent capital contributed for the purchase of a charitable gift annuity?

2) Can a registered charity accept any form of capital other than cash towards the purchase of a charitable gift annuity?

3) If a registered charity can accept publicly traded shares as payment for the charitable gift annuity, would the amount of the taxable capital gains be used to determine the value of the donation?

Position:

In the particular situation, there has not been a gift of the publicly traded shares. However, where a taxpayer uses publicly traded shares to purchase an annuity from a registered charity, we would consider that there has been a gift equal to the excess of the fair market value of the shares over the total amount of the annuity payments expected to be received by the donor, pursuant to IT-111R2. In a situation where a donor uses publicly traded shares to purchase an annuity from a registered charity, the donor cannot make an election under subsection 118.1(6), because technically there is no “gift”.

Reasons:

23 February 1998 External T.I. 9726465 - PRINCIPAL RESIDENCE

Unedited CRA Tags
54

Principal Issues:

Principal Residence - land in excess of 1/2 hectare - Timing of conversion of part of land adjacent to residence to inventory

Position:

Law generally explained

Reasons:

19 February 1998 External T.I. 9731615 - REIMBURSEMENT OF LEGAL FEES

Unedited CRA Tags
56(1)(l.1) 60(o.1) 153(1) 60(j.1)

Principal Issues:

Withholding requirements on the reimbursement of legal fees in wrongful dismissal cases.

Position:

There are no withholding requirements with respect to reimbursements of legal fees described in paragraph 56(1)(l.1). Appropriate withholdings required for reimbursement of legal fees included in income by virtue of 6(1)(j). However administrative policy to waive the withholding requirements if the reimbursement is deductible under 8(1)(b).

Reasons:

19 February 1998 External T.I. 9732945 - QUALIFIED FARM PROPERTY

Unedited CRA Tags
110.6(1)

Principal Issues:

Whether the land owned by taxpayers is considered to be
"qualified farm property"?

Position:

Perhaps

Reasons:

19 February 1998 External T.I. 9639785 - PARTNERSHIP INCOME

Unedited CRA Tags
96(1) 103(1)

Principal Issues:

Whether the computation of income of a member of a partnership is dependent on amounts paid to the member by the Partnership.

Position:

No. Amounts paid or distributed to a partner by a partnership are a method of distributing the income of the partnership. For income reporting purposes by the member, the member's share of the partnership income for a fiscal period must be reported by the member for his/her taxation year in which the fiscal year ends, whether or not any amount of the partnership's income is received or receivable by the member.

Reasons:

18 February 1998 External T.I. 9803255 - FEDERAL ESTATE TAX RELEASE

Unedited CRA Tags
2

Principal Issues:

Is a Federal Estate Act release required on the purchase of a property?

Position:

No

Reasons:

17 February 1998 External T.I. 9803655 - ENTERTAINAMENT AT GOLF CLUBS

Unedited CRA Tags
18(1)(l)

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.

		980365
XXXXXXXXXX	B. Kerr

Attention: XXXXXXXXXX

February 17, 1998

Dear Sirs:

Re: Entertainment Expenses at Golf Clubs

This is further to our letter of November 10, 1997, regarding the deductibility of entertainment expenses at a golf club.

16 February 1998 External T.I. 9801925 - QUALIFIED SMALL BUSINESS CORPORATION SHARES

Unedited CRA Tags
110.6(1)

Principal Issues:

Whether shares are "qualified small business corporation shares" Do the cash and marketable securities constitute assets used principally in an active business.

Position:

The cash and marketable securities may constitute active business assets. Not enough facts to determine whether or not the shares qualify as QSBCS.

Reasons:

12 February 1998 External T.I. 9800475 - 110(1)(F)(III)

Unedited CRA Tags
56(1)(a)(i)

Principal Issues:

Whether pension income from the Food and Agriculture Organization is taxable in Canada (the FAO is part of the United Nations).

Position:

Yes.

Reasons:

12 February 1998 External T.I. 9717155 - CHILD SUPPORT

Unedited CRA Tags
56.1

Principal Issues:

Where a court order or agreement is made before May 1997 and child support amounts are otherwise deductible, the agreement will be considered to have a “commencement day” if the order or agreement is varied after April 1997 to increase or decrease the child support amounts payable (subparagraph 56.1(4)(b)(ii)). Is this subparagraph applicable if a pre-May 1997 agreement includes a term for a cost of living increase?

Position:

Subparagraph 56.1(4)(b)(ii) is not considered to be applicable.

Reasons:

11 February 1998 External T.I. 9717785 - PROPERTY RIGHTS - MARRIAGE BREAKDOWN

Unedited CRA Tags
73(1)

Principal Issues:

Under a court judgment, a person is entitled to a share of her former spouse’s pension benefits. Is the person required to include the benefits received in her income?

Position: No

Reasons:

11 February 1998 External T.I. 9709355 - Is partnership of corp's S/H related to corp

Unedited CRA Tags
44(1) 248(1) 251(2)

Principal Issues:

Whether a corporation's building which is used by a partnership, the members of which are the corporation's shareholder, qualifies as a "former business property" for purposes of section 44 of the Act.

Position: No.

Reasons:

10 February 1998 External T.I. 9733025 - CHILD SUPPORT

Unedited CRA Tags
56.1(4) 56(1)(b) 60(b)

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.

973302
XXXXXXXXXX G. Moore

February 10, 1998

Dear XXXXXXXXXX:

Re: Advance Income Tax Ruling Request
XXXXXXXXXX

This is in reply to your letter of December 10, 1997, in which you requested an advance income tax ruling regarding child support payments.

6 February 1998 External T.I. 9733255 - QUALIFIED SMALL BUSINESS CORPORATION SHARE

Unedited CRA Tags
110.6(1)

Principal Issues:

Definition of Qualified Small Business Corporation Shares and when cash or near cash property will be considered to be used in the course of an active business.

Position:

No position taken due to lack of information, only general comments provided.

Reasons:

6 February 1998 External T.I. 9720005 - EMPLOYMENT AT SPECIAL OR REMOTE WORK SITE

Unedited CRA Tags
6(6)

Principal Issues:

Whether accomodation, living and car allowances paid to employees employed at a special work site are tax-exempt.

Position:

Reasonable allowance for accomodation and living are exempt provided conditions of 6(6) are met, the car allowance is taxable.

Reasons:

28 January 1998 External T.I. 9720835 F - FRAIS MÉDICAUX ET FRAIS DE GARDE D'ENFANTS

Unedited CRA Tags
ITA 118.2(2)e) ITA 63(3)

Principales Questions:

Il s'agit d'un centre de XXXXXXXXXX

1.Est-ce que les frais payés au Centre sont des frais médicaux admissibles selon l'alinéa 118.2(2)e) de la Loi ?

2.Est-ce que les frais payés au Centre sont des frais de garde d'enfants aux fins du paragraphe 63(3) de la Loi ?

Position Adoptée:

22 December 1997 External T.I. 9714875 - PROSPECTIVE GIFT TO A PROVINCIAL FOUNDATION

Unedited CRA Tags
118.1

Principal Issues:

Whether there is a gift when an individual transfers a property to a government agency (i.e., XXXXXXXXXX) who immediately turns the property over to an organization that is not a registered charity?

Position:

There is no gift in this situation.

Reasons:

17 November 1997 External T.I. 9715485 - INDIAN ACT EXEMPTION - RESERVE

Unedited CRA Tags
81(1)(a)

Principal Issues:

(1) Status Indian employees working for XXXXXXXXXX (near but not on a reserve) located on land which was purchased by a band and leased to XXXXXXXXXX. Whether their employment income may be exempt from income tax.

(2) Whether employment income earned further to the implementation of an agreement (Memorandum of Understanding) between the Government of Canada and XXXXXXXXXX is property given under a treaty or agreement as understood in paragraph 90(1)(b) of the Indian Act.

Position:

(1) Exemption cannot be granted.

(2) Property not given under treaty or agreement.

Reasons:

10 September 1997 External T.I. 9720635 - DEEMED DIVIDEND

Unedited CRA Tags
84(3)

Principal Issues: none

Position:

Reasons:

22 July 1997 External T.I. 9716825 - DEEMED DIVIDEND

Unedited CRA Tags
84(3)

Principal Issues:

In calculating a deemed dividend under 84(3), we use the exchange rate prevailing at the time of the redemption to determine proceeds and the rate prevailing at the time of the share issue to determine the paid-up capital.

Position:

No change in position.

Reasons:

Technical Interpretation - Internal

11 March 1998 Internal T.I. 9801987 - EQUIVALENT-TO-SPOUSE TAX CREDIT- COMMON LAW SPOUSE

Unedited CRA Tags
252(4) 118(1)(b)

Principal Issues:

Where common-law spouses separate for a period less than 90 days during the year, would the spouses be eligible for the equivalent to spouse credit?

Position:

Yes.

Reasons:

10 March 1998 Internal T.I. 9724307 - MEMBER SHARE CAPITAL

Unedited CRA Tags
181.3(3)

Principal Issues:

For the purpose of Part I.3 what are the proper amounts to be included in the computation of a credit unions' share capital, under subsection 181.3(3) of the Act? The regulatory financial statements require reporting the "minimum membership share capital" as equity while the excess "share deposits" are reflected as a deposit liability. However, under GAAP the both amounts are reflected as share capital.

Position:

Still a question of fact and law to be determined, on a case by case basis, under the provisions of the particular credit union legislation. In this situation, the better view based on the facts is the disputed amounts are deemed to be shares issued to members under the Credit Unions and Caisses Populaires Act of Ontario for the years in question and this was the basis for reporting these amounts as part of share capital under GAAP.

Reasons:

24 February 1998 Internal T.I. 9731327 - REPAYMENT OF PENSION BENEFITS

Unedited CRA Tags
60(j.03) 60(j.04) 8(1)(m)

Principal Issues:

Can the taxpayer get a reassessment to allow a greater deduction for his pension payback costs?

Position:

1.1. The Taxpayer was phoned on December 19, 1997. We advised him that someone from the Tax Services Office would be contacted by us and provided with our comments on this matter. The TSO would then initiate any corrections that are necessary and would contact him to discuss these.
2. General explanation of provisions was provided to the TSO.

Reasons:

19 February 1998 Internal T.I. 9720077 F - FRAIS D'ÉTUDE DE FAISABILITÉ

Unedited CRA Tags
ITA 18(1)a)

Principales Questions:

Est-ce que les dépenses relatives à des études de faisabilité et d'autres dépenses préliminaires à la construction XXXXXXXXXX sont déductibles dans le calcul du revenu du contribuable compte tenu que le projet a été abandonné ?

Position Adoptée:

17 February 1998 Internal T.I. 9803677 - ENTERTAINMENT AT GOLF CLUBS

Unedited CRA Tags
18(1)(l)(i)

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.

		February 17, 1998
	London Tax Services Office	HEADQUARTERS
	Verification, Enforcement,	B. Kerr
	  Compliance Research	(613) 957-8953
	Attention: Clark Gee
		980367

Entertainment Expenses at Golf Clubs

16 February 1998 Internal T.I. 9714117 F - CATÉGORIE D'AMORTISSEMENT - FOSSE A PURIN

Unedited CRA Tags
CLASS 24 SCH II REG 4600 127(5)

Principales Questions:

1. Dans quelle catégorie d'amortissement de l'Annexe II du Règlement de l'impôt sur le revenu se classent une fosse à purin et une plate-forme à fumier?
2. Est-ce que de telles acquisitions donnent droit à un crédit d'impôt à l'investissement (CII) en vertu du paragraphe 127(5) de la Loi.

Position Adoptée:

12 February 1998 Internal T.I. 9719817 F - INDIENS - REVENU D'INTÉRET - FONDS DE PLACEMENT

Unedited CRA Tags
81(1)a)

Principales Questions:

Est-ce que les revenus d'intérêts provenant de XXXXXXXXXX seraient exonérés d'impôt en vertu de l'alinéa 81(1)a) de la Loi?

Position Adoptée:

11 February 1998 Internal T.I. 9727537 - MOVING EXPENSES

Unedited CRA Tags
110(1)(f) 62

Principal Issues:

During July of 1996, an individual commenced an employment position with XXXXXXXXXX and earned $XXXXXXXXXX in that year. Pursuant to subparagraph 110(1)(f)(iii), the individual was entitled to deduct the amount of $XXXXXXXXXX which was reported as employment income. In connection with the XXXXXXXXXX employment, the individual moved from XXXXXXXXXX and claimed moving expenses of $XXXXXXXXXX (the individual earned employment income of $XXXXXXXXXX prior to leaving Canada). The issue is whether the individual is entitled to deduct the moving expenses under section 62 of the Act.

Position:

It depends on whether or not the individual was a non-resident at the time in late 1996 when he moved into the new residence in XXXXXXXXXX.

Reasons:

10 February 1998 Internal T.I. 9732317 - PARAGRAPH 20(1)(L)

Unedited CRA Tags
20(1)(l) REG 8000

Principal Issues:

Whether or not a general reserve can be claimed pursuant to paragraph 20(1)(l) of the Income Tax Act.
Various issues with respect to the computation of a reserve pursuant to paragraph 20(1)(l).

Position:
A general reserve is not allowed
See attached document

Reasons:

9 February 1998 Internal T.I. 9702317 F - INDIENS - REVENU D'INTÉRET - DÉPOT A TERME

Unedited CRA Tags
81(1)a)

Principales Questions:

Est-ce que les revenus d'intérêts provenant d'un certificat de dépôt à terme émis par XXXXXXXXXX seraient exonérés d'impôt en vertu de l'alinéa 81(1)a) de la Loi?

Position Adoptée:

6 February 1998 Internal T.I. 9729937 - INTEREST ON RETRO REINSTATED WCB BENEFITS-CHARTER

Unedited CRA Tags
12(1)(c)

Principal Issues:

tax treatment of interest for retroactive reinstatement of WCB survivor benefits arising from a Charter challenge to ss 19(2) of the Workers Compensation Act of B.C.

Position:

taxable under 12(1)(c) as interest with no offset under 110(1)(f)

Reasons:

29 January 1998 Internal T.I. 9711517 - CLERGYMAN'S RESIDENCE - CHAPLAIN

Unedited CRA Tags
8(1)(c)

Principal Issues:
Whether XXXXXXXXXX, qualifies for the deduction under paragraph 8(1)(c).

22 January 1998 Internal T.I. 9729177 F - Auto mise à la disposition d'un EMPLOYÉ/ACTIONNAIRE

Unedited CRA Tags
ITA 6(1)e)

Principales Questions:

M.A est actionnaire majoritaire et employé de Cie A. Cette dernière a mis une automobile à la disposition de M.A pour son usage personnel et également pour l'accomplissement des fonctions de sa charge ou de son emploi. M.A séjourne en Floride 6 mois par année. Pendant cette période l'automobile est remisée par Cie A dans un garage spécialisé. Est-ce que l'automobile est mise à la disposition de M.A pendant son séjour en Floride ?

Position Adoptée:

16 January 1998 Internal T.I. 9722147 F - FRAIS DE DÉPLACEMENT - MEMBRES DU CLERGÉ

Unedited CRA Tags
8(1)h) 8(1)h.1)

Principales Questions:

Est-ce qu’un membre du clergé dont le nom apparaît à l’index des membres du clergé de l’Annuaire de l’Église Catholique au Canada a automatiquement droit à la déduction de frais de déplacement?

Position Adoptée:

16 January 1998 Internal T.I. 9731866 F - Pension ou rente, Convention AVEC LA FRANCE

Unedited CRA Tags
Treaty

Principales Questions:ANNUITY OR PENSION FOR TAX TREATY PURPOSE

Position Adoptée:AMOUNTS RECEIVED WERE PENSION PAYMENTS

15 January 1998 Internal T.I. 9720497 F - FIDUCIE CRÉÉE POUR PAYER PENSION ALIMENTAIRE

Unedited CRA Tags
56(12) 56.1(4) 75(2) 107(2)

Principales Questions:

1. Dans la présente situation, est-ce que le paiement mensuel prévu à l'ordonnance est une allocation selon le paragraphe 56(12) de la Loi?

2. Si les paiements mensuels dus à Madame proviennent de la fiducie, est-ce que Madame devra s'imposer sur ces paiements en vertu de l'alinéa 56(1)b) de la Loi et est-ce que Monsieur aura droit à une déduction en vertu de l'alinéa 60b) de la Loi?

3. Compte tenu du fait que la fiducie générera des revenus, qui devra s'imposer sur les revenus de la fiducie pendant son existence?

4. Quelles seront les conséquences fiscales lors de la liquidation de la fiducie?

Position Adoptée:

15 January 1998 Internal T.I. 9719337 F - FOUGONNETTE ADAPTÉE - PARTICULIER EN FAUTEUIL ROULANT

Unedited CRA Tags
118.2(2)l.7) 118.2(2)m) 118.2(3)b) REG 5700m)

Principales Questions:

1. Peut-on considérer le coût d’acquisition d’une automobile (autre qu’une fourgonnette) dans le calcul du crédit d’impôt pour frais médicaux si cette dernière est adaptée pour le transport d’un particulier en fauteuil roulant au plus tard six mois après l’acquisition de la voiture?
2. Pour que le coût d’acquisition d’une fourgonnette soit considéré dans le calcul du crédit d’impôt pour frais médicaux en vertu de l’alinéa 118.2(2)l.7) de la Loi proposé, de quel genre d’appareils doit-on équiper cette fourgonnette?
3. Si la fourgonnette est acquise en échange d’un autre véhicule, est-ce que le montant payé pour l’acquisition de la fourgonnette pour les fins du calcul du crédit d’impôt pour frais médicaux est le coût après déduction de la valeur du véhicule échangé?

Position Adoptée:

5 January 1998 Internal T.I. 9733237 - INCOME AVERAGING, SDA

Unedited CRA Tags
248(1) 6(11)

Principal Issues:

1) Would a part-time teacher's averaging of income over the school year result in the creation of an SDA? 2) Would a voluntary leave plan that allows a teacher to cut-back work hours before retiring result in an SDA?

Position:

Question of fact in both cases.

Reasons:

24 December 1997 Internal T.I. 9727667 - YUKON TERRITORY LANDS - INCOME TAX REMISSION ORDER

Unedited CRA Tags
81

Principal Issues:

Whether an Indian living in the Yukon can rely on the Income Tax Remission Order (Yukon Territory Lands) for exemption from income tax up until December 31, 1998 or only until February 14, 1998.

Position:

December 31, 1998 (for lands that are notated as "set aside" at any time in 1998).

Reasons:

22 December 1997 Internal T.I. 9729487 F - FRAIS MÉDICAUX, LIT AJUSTABLE

Unedited CRA Tags
ITA 118.2(2)i) REG 5700h)

Principales Questions:

1.Est-ce qu'un "lit berceur", au sens de l'alinéa 118.2(2)i) de la Loi, peut comprendre un "lit ajustable" ou un "lit à bascule" ?

2.Faut-il absolument que le contribuable soit atteint de poliomyélite pour se prévaloir du crédit pour frais médicaux suite à l'achat d'un "lit berceur" selon l'alinéa 118.2(2)i) de la Loi ?

3.Est-ce qu'un "lit berceur", un "lit ajustable" et un "lit à bascule" peuvent répondre à la définition de "lit d'hôpital" prévue à l'alinéa 5700 h) du Règlement ?

Position Adoptée:

16 December 1997 Internal T.I. 9721777 - CHILD SUPPORT

Unedited CRA Tags
56(1)(d)

Principal Issues:

Whether an individual is entitled to deduct child maintenance of $XXXXXXXXXX in 1995 and 1996.

Position:

No

Reasons:

15 December 1997 Internal T.I. 9729556 - SUBSECTION 104(4) AND ARTICLE XXIX B OF U.S.

Unedited CRA Tags
ART XXIX B U.S. 104(4) 75(2) 94(1) 70(6)

Principal Issues:

Whether double taxation occurs as a result of the application of subsections 104(4) and 70(5) and Article XXIB of the Canada-U.S. Income Tax Convention.

Position:

Yes, in the situation described in the memo.

Reasons:

3 December 1997 Internal T.I. 9724686 - JET JAPANESE TEACHERS PROGRAM

Unedited CRA Tags
ART 20

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.

27 November 1997 Internal T.I. 9706977 - DETERMINATION OF PAID-UP CAPITAL

Unedited CRA Tags
89(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.

		November 27, 1997
G. Reid 	Income Tax Rulings and
	Toronto Centre TSO	Interpretations
		Directorate
	Attention;  Dominic Tiu	J. Teixeira
	               443-1-2		(613) 957-2095
		7-970697

Determination of Paid-up Capital

8 August 1997 Internal T.I. 9712556 - YOUTH SERVICES PROGRAM

Unedited CRA Tags
3(a) 5 6 7

Principal Issues: Are Youth Prorgrams employment income ?

Position: CPP/EI should respond

Reasons:

20 May 1997 Internal T.I. 9713120 - LLC - STATUS FOR CANADA-U.S. INCOME TAX TREATY

Unedited CRA Tags
Art IV

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.

UNITED STATES LIMITED LIABILITY COMPANIES

Tax Convention Status

Ministerial Letter

16 December 1997 Ministerial Letter 9720528 - WCB-WHETHER T5007 T/B ISSUED, $ OFFSET

Unedited CRA Tags
56(1)(v)

Principal Issues:

whether an amount "offset" from a settlement amount already paid to an injured worker under paragraph 17(5)(d) of Alberta's Workers' Compensation Act is taxable under para 56(1)(v) of the ITA as an amount received under a compensation law (i.e. does the Workers Compensation Board (the Board) have to issue a T5007 slip for these amounts). The Board is required to pay pension and other benefits to the injured worker but is, instead, setting these amounts off from an earlier lump sum payment made to the worker. The inclusion of these amount into income has an impact on the client's GST and other credits.

Position:

At this time, yes. However, litigation is ongoing between the injured worker and the Board to determine if, in law, the Board has the authority to set off future pension or other benefits from an amount which it has already paid under 17(5)(d), which provision requires the Board to pay any excess (cost of the accident to the Board less legal costs and other amounts/payments) to the worker, legal rep. or dependants, as the case may be. Will re-examine Department's position if Board is proven to be not authorized to provide for payment of pension and other benefits in this manner

Reasons: