Income Tax Severed Letters - 1998-11-13

Miscellaneous

16 October 1998 Miscellaneous E9824318.txt - BUDGET CHANGES TO MOVING EXPENSES

Unedited CRA Tags
62 6

Principal Issues: 98 budget amendment to moving reimbursement

Position: finance issue

Reasons: change in Act

14 October 1998 Miscellaneous E9823098.txt - TRUST LEAVING CANADA

Unedited CRA Tags
104

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.

XXXXXXXXXX

Dear XXXXXXXXXX :

The Honourable Herb Dhaliwal, Minister of National Revenue, has asked me to reply to your letter of July 19, 1998, concerning the taxation of property when the owner leaves Canada.

17 August 1998 Miscellaneous E9816768.txt - MUNICIPAL TAXES ON COTTAGE PROPERTY

Unedited CRA Tags
40(1) 53(1)

Principal Issues: tax treatment of municipal taxes, including road upgrade assessments, on cottage

Position: non-deductible as no income earning purpose, and not added to ACB of cottage, as road upgrades are publicly owned

Reasons:

11 August 1998 Miscellaneous E9819311.txt - TAX ON SIGNING BONUS - NON-RESIDENT ATHLETE

Unedited CRA Tags
115(2)(c.1) 115(1)(a)(v) 6(3) Article 15 Dependent personal services of OECD model 3

Principal Issues: Taxation of signing bonuses paid to non-resident athletes

Position: See issue sheet

Reasons: See issue sheet

11 August 1998 Miscellaneous 9819311 - TAX ON SIGNING BONUS - NON-RESIDENT ATHLETE

Unedited CRA Tags
115(2)(c.1) 115(1)(a)(v) 6(3) Article 15 Dependent personal services of OECD model 3

Principal Issues: Taxation of signing bonuses paid to non-resident athletes

Position: See issue sheet

Reasons: See issue sheet

Ruling

30 November 1997 Ruling E9815343 - DEDUCTIBILITY OF MEMBERSHIP FEES

Unedited CRA Tags
8(1)(I)(IV) 8(5)

Principal Issues: are dues paid to XXXXXXXXXX deductible under 8(1)(i)(iv) as annual dues to maintain membership in an association of public servants, the primary object of which is to promote improvement of the member's conditions of employment or work.

Position: amounts deductible

Reasons: bylaws reflect primary purpose test is met, membership restricted to public servants

30 November 1997 Ruling 9815493 F - DEBENTURES

Unedited CRA Tags
20(1)(f)

Principales Questions: Modifications mineures

Position Adoptée: S/O

30 November 1997 Ruling 9803523 - CORPORATE MERGER.

Unedited CRA Tags
51(1) XXXXXX 85.1(1)

Principal Issues: Several issues regarding corporate reorganization.

Position: See statement of principal issues.

Reasons: See statement of principal issues.

30 November 1997 Ruling 9815343 - DEDUCTIBILITY OF MEMBERSHIP FEES

Unedited CRA Tags
8(1)(I)(IV) 8(5)

Principal Issues: are dues paid to XXXXXXXXXX deductible under 8(1)(i)(iv) as annual dues to maintain membership in an association of public servants, the primary object of which is to promote improvement of the member's conditions of employment or work.

Position: amounts deductible

Reasons: bylaws reflect primary purpose test is met, membership restricted to public servants

30 November 1997 Ruling 9805273 F - PLACEMENTS ÉTRANGERS

Unedited CRA Tags
132(6) 206(1)

Principales Questions:

1. Est-ce que le rachat des parts rencontre l'alinéa 108(2)(a)?

2. Peut-on rendre une décision sur la nature des activités d'une fiducie de fonds commun de placement et si certains placements (produits financiers dérivés) sont des biens étrangers au sens de 206(1)?

Position Adoptée:

30 November 1997 Ruling 9809643 F - EXCHANGEABLE DEBENTURES

Unedited CRA Tags
20(1)(f) 20(1)(e) 20(1)(c) 18(9.1)

Principales Questions:

1. 18(9.1) et 20(1)(e) sont-ils applicables en cas de remboursement avant échéance à la demande de l'émetteur?
2. 20(1)(f) applicable pour la portion du paiement qui excède la valeur nominale des débentures en cas de remboursement avant échéance à la demande du détenteur?
3. Clause de rajustement de prix affecte-t-elle la somme convenue aux fins de 85?
4. Est-ce que 55(2)(b) applicable si le dividende présumé selon 84(1) est réputé ne pas être un dividende selon 55(2)(a)?

Position Adoptée:

30 November 1996 Ruling F9719413 F - PRIME ESCOMPTE

Unedited CRA Tags
20(1)(e) 18(9.1) 49 20(1)(c)

Principales Questions:

Il s'agit de débentures dont le paiement, s'il survient avant l'échéance soit à la demande du détenteur ou au gré de l'émetteur, sera égal à la valeur marchande d'un nombre donné d'actions au moment du remboursement. Dans un tel cas, l'émetteur peut avoir à débourser un montant supérieur à la valeur nominale des débentures.

1. 20(1)(f) applicable pour la portion du paiement qui excède la valeur nominale des débentures en cas de remboursement avant échéance à la demande du détenteur?
2. 18(9.1) et 20(1)(e) applicables en cas de remboursement avant échéance à la demande de l'émetteur?
3. Est-ce que les intérêts sur les débentures déductibles selon 20(1)(c)?

Position Adoptée:

30 November 1996 Ruling 9719413 F - PRIME ESCOMPTE

Unedited CRA Tags
20(1)(e) 18(9.1) 49 20(1)(c)

Principales Questions:

Il s'agit de débentures dont le paiement, s'il survient avant l'échéance soit à la demande du détenteur ou au gré de l'émetteur, sera égal à la valeur marchande d'un nombre donné d'actions au moment du remboursement. Dans un tel cas, l'émetteur peut avoir à débourser un montant supérieur à la valeur nominale des débentures.

1. 20(1)(f) applicable pour la portion du paiement qui excède la valeur nominale des débentures en cas de remboursement avant échéance à la demande du détenteur?
2. 18(9.1) et 20(1)(e) applicables en cas de remboursement avant échéance à la demande de l'émetteur?
3. Est-ce que les intérêts sur les débentures déductibles selon 20(1)(c)?

Position Adoptée:

Technical Interpretation - External

12 November 1998 External T.I. 9819695 F - BAIL

Unedited CRA Tags
12(1)(x)

Principales Questions:

Traitement du paiement reçu pour obtenir l’autorisation de sous-louer.

Position Adoptée:

10 November 1998 External T.I. E9826725 - LEAVE WITH PAY FOR EDUCATION AND TRAINING.

Unedited CRA Tags
5(1) 6(1)(a) 8(1) 118.5(1)

Principal Issues: The income tax implications of various types of employer-paid educational/professional development leaves which are available to teachers. In particular, the effect, if any, that our new guidelines, which were announced in Technical News #13, have on these types of leaves.

Position: The salary received by teachers while on leave is taxable as employment income. Since educational costs are fully paid by the teachers, our new guidelines have no effect.

Reasons: An employee cannot convert taxable salary into non-taxable employer-paid educational costs. The full amount of salary remains taxable as employment income.

10 November 1998 External T.I. 9826725 - LEAVE WITH PAY FOR EDUCATION AND TRAINING.

Unedited CRA Tags
5(1) 6(1)(a) 8(1) 118.5(1)

Principal Issues: The income tax implications of various types of employer-paid educational/professional development leaves which are available to teachers. In particular, the effect, if any, that our new guidelines, which were announced in Technical News #13, have on these types of leaves.

Position: The salary received by teachers while on leave is taxable as employment income. Since educational costs are fully paid by the teachers, our new guidelines have no effect.

Reasons: An employee cannot convert taxable salary into non-taxable employer-paid educational costs. The full amount of salary remains taxable as employment income.

6 November 1998 External T.I. E9819865 - RESP TRANSFERS TO RRSP RE HOME BUYER PLAN

Unedited CRA Tags
146 146.01 146.1

Principal Issues: Can amounts held in an RESP be transferred to an RRSP for the purpose of repaying amounts withdrawn under the home buyers plan?

Position: Yes, but the beneficial tax consequences of doing so are limited if the amount is an accumulated income payment as defined in the RESP provisions as Part X.5 tax will apply.

Reasons: The law was not drafted to provide this option.

6 November 1998 External T.I. E9822675 - RRSP TRANSFER OF FUNDS BETWEEN SPOUSES' RRSPS

Unedited CRA Tags
146(16)

Principal Issues:

Can an annuitant of an RRSP transfer funds from an RRSP to a spouse’s RRSP where there is no breakdown in their marriage?

Position:

No.

Reasons:

6 November 1998 External T.I. 9819865 - RESP TRANSFERS TO RRSP RE HOME BUYER PLAN

Unedited CRA Tags
146 146.01 146.1

Principal Issues: Can amounts held in an RESP be transferred to an RRSP for the purpose of repaying amounts withdrawn under the home buyers plan?

Position: Yes, but the beneficial tax consequences of doing so are limited if the amount is an accumulated income payment as defined in the RESP provisions as Part X.5 tax will apply.

Reasons: The law was not drafted to provide this option.

6 November 1998 External T.I. 9822675 - RRSP TRANSFER OF FUNDS BETWEEN SPOUSES' RRSPS

Unedited CRA Tags
146(16)

Principal Issues:

Can an annuitant of an RRSP transfer funds from an RRSP to a spouse’s RRSP where there is no breakdown in their marriage?

Position:

No.

Reasons:

5 November 1998 External T.I. 9827855 - PART XI, INDIVIDUAL PLANS OR ALL PLANS

Unedited CRA Tags
205

Principal Issues: Is the Part XI tax applied in respect of the foreign property held by each individual RRSP or to the aggregate property held by all of an individual’s RRSPs?

Position: Each individual RRSP is subjected to Part XI on its own property.

Reasons: The law clearly provides that each trust is subject to the foreign property limits.

5 November 1998 External T.I. E9825095 - ACTIVE BUSINESS INC. - RENTING STORAGE SPACE.

Unedited CRA Tags
125(7) 129(4)

Principal Issues: Whether income from a business in which the taxpayer owns, rents and manages i) approximately 10 fenced yard compounds outside for cold storage; ii) approximately 20 cold storage rooms within a building, and 3) approximately 4 heated garage or warehouse areas, would be considered “income of the corporation from an active business carried on in Canada” within the meaning of subsection 125(7).

Position: Question of fact; however, likely not.

Reasons: A business the principal purpose of which is to derive income from property (including income from rentals of real property), would be considered a “specified investment business” as defined in subsection 125(7) unless, inter alia, the corporation employs in the business throughout the year more than five full-time employees. Income from a source that is property, which includes income from a specified investment (subsection 129(4)), is not to be included in the computation of “income of the corporation for the year from an active business” by virtue of its definition in 125(7).

5 November 1998 External T.I. 9825095 - ACTIVE BUSINESS INC. - RENTING STORAGE SPACE.

Unedited CRA Tags
125(7) 129(4)

Principal Issues: Whether income from a business in which the taxpayer owns, rents and manages i) approximately 10 fenced yard compounds outside for cold storage; ii) approximately 20 cold storage rooms within a building, and 3) approximately 4 heated garage or warehouse areas, would be considered “income of the corporation from an active business carried on in Canada” within the meaning of subsection 125(7).

Position: Question of fact; however, likely not.

Reasons: A business the principal purpose of which is to derive income from property (including income from rentals of real property), would be considered a “specified investment business” as defined in subsection 125(7) unless, inter alia, the corporation employs in the business throughout the year more than five full-time employees. Income from a source that is property, which includes income from a specified investment (subsection 129(4)), is not to be included in the computation of “income of the corporation for the year from an active business” by virtue of its definition in 125(7).

5 November 1998 External T.I. E9824175 - COMMISSIONS ASSIGNED TO A CORPORATION

Unedited CRA Tags
9 Reg. 200

Principal Issues: To whom should a T4A slip be made out to when a commission agent assigns his commission to a corporation? If the agent has to report the income can he or she deduct the amounts that are paid to the corporation?

Position: The T4A slip should be made out to the commission agent. The commission agent is not entitled to an expense in respect of the amounts paid to the corporation.

Reasons: The person who has earned the income should be the recipient of the T4A. Subsection 209(1) of the Income Tax Regulations refers to “forward to each taxpayer to whom the return relates”. The amounts paid to the corporations are not expenses set out to earn income.

5 November 1998 External T.I. 9824175 - COMMISSIONS ASSIGNED TO A CORPORATION

Unedited CRA Tags
9 Reg. 200

Principal Issues: To whom should a T4A slip be made out to when a commission agent assigns his commission to a corporation? If the agent has to report the income can he or she deduct the amounts that are paid to the corporation?

Position: The T4A slip should be made out to the commission agent. The commission agent is not entitled to an expense in respect of the amounts paid to the corporation.

Reasons: The person who has earned the income should be the recipient of the T4A. Subsection 209(1) of the Income Tax Regulations refers to “forward to each taxpayer to whom the return relates”. The amounts paid to the corporations are not expenses set out to earn income.

5 November 1998 External T.I. E9827855 - PART XI, INDIVIDUAL PLANS OR ALL PLANS

Unedited CRA Tags
205

Principal Issues: Is the Part XI tax applied in respect of the foreign property held by each individual RRSP or to the aggregate property held by all of an individual’s RRSPs?

Position: Each individual RRSP is subjected to Part XI on its own property.

Reasons: The law clearly provides that each trust is subject to the foreign property limits.

3 November 1998 External T.I. 9806545 F - CIPCMC - REGLE DU 25 ANS

Unedited CRA Tags
125.4

Principales Questions: Une production devient-elle une production exclue lorsque le producteur transfère, à l'intérieur du 25 ans, son droit d'auteur à une filiale et à une société dont il détient la majorité des droits de vote?

Position Adoptée: non pourvu d'une part que la société demeure liée au sens de l'article 251 de la Loi et d'autre part pourvu que la filiale (ou l'autre société) demeure une société canadienne imposable au sens de l'article 1106 du Règlement

2 November 1998 External T.I. 9809425 - TRAINING BENEFITS RECEIVED BY STATUS INDIANS

Unedited CRA Tags
81(1)(a) 56(1)(r) 56(1)(n)

Principal Issues: Taxability of training benefits received by status Indians which are funded by HRDC.

Position: The taxation depends on the stream of funding as well as the connecting factors.

Reasons:

30 October 1998 External T.I. 9824385 - PERSONAL INJURY (DAMAGES)

Unedited CRA Tags
56(1)(d)

Principal Issues: An individual sustained an injury and is entitled to non-taxable benefits under a long-term disability (LTD) policy. If the periodic payments are made by the insurer in a manner that is similar to a structured settlement (paragraph 5 of IT-365R2), would the payments still be regarded as being non-taxable? (The query has been raised as a result of an excerpt in a publication)

Position: No. On the basis that the payments will not be made in accordance with written terms in the LTD policy, the payments will give rise to income in the hands of the individual to the extent provided for in respect of annuity contracts under the Income Tax Act.

Reasons: Paragraph 5 of IT-365R2 only applies in respect of payments made in respect of personal injury or death.

30 October 1998 External T.I. E9824385 - PERSONAL INJURY (DAMAGES)

Unedited CRA Tags
56(1)(d)

Principal Issues: An individual sustained an injury and is entitled to non-taxable benefits under a long-term disability (LTD) policy. If the periodic payments are made by the insurer in a manner that is similar to a structured settlement (paragraph 5 of IT-365R2), would the payments still be regarded as being non-taxable? (The query has been raised as a result of an excerpt in a publication)

Position: No. On the basis that the payments will not be made in accordance with written terms in the LTD policy, the payments will give rise to income in the hands of the individual to the extent provided for in respect of annuity contracts under the Income Tax Act.

Reasons: Paragraph 5 of IT-365R2 only applies in respect of payments made in respect of personal injury or death.

29 October 1998 External T.I. 9822165 - FOREIGN ASSET REPORTING

Unedited CRA Tags
233.3

Principal Issues: Foreign asset reporting in section 233.3 of the Act

Position: Section 233.3 of the Act will apply for the 1998 and subsequent taxation years if the ACB of the specified foreign property exceeds $100,000.

Reasons: all conditions satisfied in section 233.3 of the Act.

29 October 1998 External T.I. F9726115 F - DÉCLARATION D'UNE SOCIÉTÉ DE PERSONNES

Unedited CRA Tags
152(1.4)

Principales Questions:
1. Est-ce que le nouveau paragraphe 152(1.4)de la Loi permet au ministre d'effectuer une détermination du revenu ou de la perte d'une société de personnes pour n'importe quelle année pour laquelle une déclaration de renseignements n'a pas été produite pour cette dernière ?

2. Est-ce que la production en retard des déclarations de renseignements relatives à une société de personnes pourrait donner lieu à la renonciation des intérêts et pénalités par le ministre au même titre que lors d'une divulgation volontaire ?

Position Adoptée:
1. Oui, le paragraphe 152(1.4) de la Loi permet une telle détermination, suite à une demande du ministre, en vertu du paragraphe 233(1) de la Loi, de produire la déclaration de renseignements concernant la société de personnes pour une années donnée.

29 October 1998 External T.I. 9807525 F - DÉCRET DE REMISE - TEMPÊTE DE VERGLAS

Unedited CRA Tags
6(1)a)

Principales Questions:

Est-ce qu’un montant versé par un employeur à ses employés à titre d'aide humanitaire pour une semaine de salaire incomplète en raison de la tempête de verglas en janvier 1998 pourrait être traité comme un don non imposable au lieu d'un revenu d'emploi.

Position Adoptée:

29 October 1998 External T.I. 9726115 F - DÉCLARATION D'UNE SOCIÉTÉ DE PERSONNES

Unedited CRA Tags
152(1.4)

Principales Questions:
1. Est-ce que le nouveau paragraphe 152(1.4)de la Loi permet au ministre d'effectuer une détermination du revenu ou de la perte d'une société de personnes pour n'importe quelle année pour laquelle une déclaration de renseignements n'a pas été produite pour cette dernière ?

2. Est-ce que la production en retard des déclarations de renseignements relatives à une société de personnes pourrait donner lieu à la renonciation des intérêts et pénalités par le ministre au même titre que lors d'une divulgation volontaire ?

Position Adoptée:
1. Oui, le paragraphe 152(1.4) de la Loi permet une telle détermination, suite à une demande du ministre, en vertu du paragraphe 233(1) de la Loi, de produire la déclaration de renseignements concernant la société de personnes pour une années donnée.

29 October 1998 External T.I. 9807885 F - DÉCRET DE REMISE - TEMPÊTE DE VERGLAS

Unedited CRA Tags
6(1)a)

Principales Questions:

Est-ce qu’un montant versé par un employeur à ses employés à titre de don pour le manque d’une semaine de travail lors de la tempête de verglas en janvier 1998 serait non imposable et non assurable.

Position Adoptée:

29 October 1998 External T.I. F9732605 F - DISPOSITION ET RÉACQUISITION D'UN IMMEUBLE

Unedited CRA Tags
13(21.2)

Principales Questions:
Est-ce qu’un particulier qui transfère une bâtisse utilisée dans l’exploitation d’une entreprise en faveur d’une société qu’il contrôle pour un produit de disposition équivalant à la juste valeur marchande et qui réacquiert la bâtisse le même jour peut subir une perte finale ?

Position Adoptée:
Non, la perte finale se calculant à la fin d’une année d’imposition, le contribuable aurait toujours une bâtisse dans la catégorie à la fin de l’année et ne rencontrerait pas les conditions du paragraphe 20(16) de la Loi.

29 October 1998 External T.I. E9821355 - WINDING-UP "BUMP"

Unedited CRA Tags
88(1)(c)(vi)

Principal Issues: Does subparagraph 88(1)(c)(vi) deny a "bump" when Target transfers property to a new subsidiary, in return for shares, in advance of the acquisition and liquidation of Target by Purchaser.

Position: If cash sale and transferred property is capital, no. If shares received by vendor, maybe.

Reasons: See below.
5-982135
XXXXXXXXXX D.A. Palamar
(613) 957-2127
Attention: XXXXXXXXXX

29 October 1998 External T.I. 9807185 - CHARITABLE REMAINDER TRUST

Unedited CRA Tags
118.1 149.1(1)

Principal Issues:

1. The enquiry concerns the valuation of an inter vivos gift of an equitable interest in a trust to a charity. The situation described is where the property transferred to the charitable remainder trust is jointly owned by a husband and wife, both the spouses have full income entitlement until the death of the first spouse and the surviving spouse has a fixed income entitlement which is less than full income.

2. What is the effect of an inter vivos gift of an equitable interest in a trust on the disbursement quota of the charity?

Position:

1. None.

2. It would be excluded from the calculation of the charity’s disbursement quota to the extent that the gift qualifies for the exclusion for ten year gifts provided in the definition of "disbursement quota" in subsection 149.1(1) of the Act.

Reasons:

29 October 1998 External T.I. 9732605 F - DISPOSITION ET RÉACQUISITION D'UN IMMEUBLE

Unedited CRA Tags
13(21.2)

Principales Questions:
Est-ce qu’un particulier qui transfère une bâtisse utilisée dans l’exploitation d’une entreprise en faveur d’une société qu’il contrôle pour un produit de disposition équivalant à la juste valeur marchande et qui réacquiert la bâtisse le même jour peut subir une perte finale ?

Position Adoptée:
Non, la perte finale se calculant à la fin d’une année d’imposition, le contribuable aurait toujours une bâtisse dans la catégorie à la fin de l’année et ne rencontrerait pas les conditions du paragraphe 20(16) de la Loi.

29 October 1998 External T.I. 9821355 - WINDING-UP "BUMP"

Unedited CRA Tags
88(1)(c)(vi)

Principal Issues: Does subparagraph 88(1)(c)(vi) deny a "bump" when Target transfers property to a new subsidiary, in return for shares, in advance of the acquisition and liquidation of Target by Purchaser.

Position: If cash sale and transferred property is capital, no. If shares received by vendor, maybe.

Reasons: See below.
5-982135
XXXXXXXXXX D.A. Palamar
(613) 957-2127
Attention: XXXXXXXXXX

29 October 1998 External T.I. E9822165 - FOREIGN ASSET REPORTING

Unedited CRA Tags
233.3

Principal Issues: Foreign asset reporting in section 233.3 of the Act

Position: Section 233.3 of the Act will apply for the 1998 and subsequent taxation years if the ACB of the specified foreign property exceeds $100,000.

Reasons: all conditions satisfied in section 233.3 of the Act.

28 October 1998 External T.I. E9820215 - REPORTING & WITHHOLDING - RETIRING ALLOWANCE

Unedited CRA Tags
153(1)(c)

Principal Issues: Whether reporting of retiring allowance payments is required by a payer who is not the employer.

Position: Yes.

Reasons: Wording of the Act.

28 October 1998 External T.I. 9826965 F - REER SUITE AU DÉCÈS

Unedited CRA Tags
146(8) 146(4)(c) 146(8.8)

Position Adoptée:

28 October 1998 External T.I. E9825435 - PORCH REPAIRS TO RENTAL PROPERTY

Unedited CRA Tags
9

Principal Issues: Porch repairs - Capitalize or Expenses?

Position: Question of fact- betterment or restored to original condition taking into account technological improvements thus situation appears to be expense.

Reasons: Position in IT 128

28 October 1998 External T.I. 9820215 - REPORTING & WITHHOLDING - RETIRING ALLOWANCE

Unedited CRA Tags
153(1)(c)

Principal Issues: Whether reporting of retiring allowance payments is required by a payer who is not the employer.

Position: Yes.

Reasons: Wording of the Act.

28 October 1998 External T.I. E9825685 - EXPENSES "INCURRED" FOR PREAMBLE TO 66(12.6)

Unedited CRA Tags
66(12.6) 66(15)

Principal Issues: For the purposes of the preamble of subsection 66(12.6), is the relevant CEE restricted to that which is incurred pursuant to the particular "agreement in writing"?

Position: No. For these purposes the relevant CEE is that incurred during the particular "24 month" period and on or before the effective date of the renunciation in question.

Reasons: Our historic position is that the preamble to subsection 66(12.6) does not contain such a restriction. In addition, the definition of flow-through share indicates the corporation must incur qualifying expenses in an amount "not less than" the relevant consideration. However, it should be noted that a renunciation in respect of a particular flow-through share would remain subject to numerous other tests, e.g., regarding when the CEE in question must have been incurred or limiting the amount of such renunciations, etc.

28 October 1998 External T.I. 9825435 - PORCH REPAIRS TO RENTAL PROPERTY

Unedited CRA Tags
9

Principal Issues: Porch repairs - Capitalize or Expenses?

Position: Question of fact- betterment or restored to original condition taking into account technological improvements thus situation appears to be expense.

Reasons: Position in IT 128

28 October 1998 External T.I. 9825685 - EXPENSES "INCURRED" FOR PREAMBLE TO 66(12.6)

Unedited CRA Tags
66(12.6) 66(15)

Principal Issues: For the purposes of the preamble of subsection 66(12.6), is the relevant CEE restricted to that which is incurred pursuant to the particular "agreement in writing"?

Position: No. For these purposes the relevant CEE is that incurred during the particular "24 month" period and on or before the effective date of the renunciation in question.

Reasons: Our historic position is that the preamble to subsection 66(12.6) does not contain such a restriction. In addition, the definition of flow-through share indicates the corporation must incur qualifying expenses in an amount "not less than" the relevant consideration. However, it should be noted that a renunciation in respect of a particular flow-through share would remain subject to numerous other tests, e.g., regarding when the CEE in question must have been incurred or limiting the amount of such renunciations, etc.

28 October 1998 External T.I. 9822105 F - ALINÉA 80(2)G.1)

Unedited CRA Tags
80(2)g.1) 80(2)(i)

Position Adoptée:

27 October 1998 External T.I. E9824915 - MED. EXP. - FEES PAID TO A PRIVATE SCHOOL.

Unedited CRA Tags
118.2(2)(e)

Principal Issues: Whether fees paid to a private school for a patient who suffers from Attention Deficit Hyperactivity Disorder (ADHD) qualify as a medical expense under paragraph 118.2(2)(e).

Position: Question of fact. However, based on the report of the doctor the fees likely do not qualify.

Reasons: ADHD may not always constitute a mental handicap since ADHD symptoms may vary from one patient to the next. Taxpayer must demonstrate that severity of disorder is such that it constitutes a mental disorder.

27 October 1998 External T.I. E9822315 - COST AMOUNT, RRSP TO RRIF TRANSFER

Unedited CRA Tags
206(4)

Principal Issues: Can property be transferred from an RRSP to a RRIF or from a RRIF to a RRIF at its cost amount for purposes of section 206?

Position: No

Reasons: Position is well established and issue has been referred to the Department of Finance.

27 October 1998 External T.I. 9824915 - MED. EXP. - FEES PAID TO A PRIVATE SCHOOL.

Unedited CRA Tags
118.2(2)(e)

Principal Issues: Whether fees paid to a private school for a patient who suffers from Attention Deficit Hyperactivity Disorder (ADHD) qualify as a medical expense under paragraph 118.2(2)(e).

Position: Question of fact. However, based on the report of the doctor the fees likely do not qualify.

Reasons: ADHD may not always constitute a mental handicap since ADHD symptoms may vary from one patient to the next. Taxpayer must demonstrate that severity of disorder is such that it constitutes a mental disorder.

27 October 1998 External T.I. E9812975 - COST AMOUNT, RRSP TO RRIF TFR

Unedited CRA Tags
206(4)

Principal Issues: Can property be transferred from an RRSP to a RRIF or from a RRIF to a RRIF at its cost amount for purposes of section 206?

Position: No

Reasons: Position is well established and issue has been referred to the Department of Finance.

27 October 1998 External T.I. 9822315 - COST AMOUNT, RRSP TO RRIF TRANSFER

Unedited CRA Tags
206(4)

Principal Issues: Can property be transferred from an RRSP to a RRIF or from a RRIF to a RRIF at its cost amount for purposes of section 206?

Position: No

Reasons: Position is well established and issue has been referred to the Department of Finance.

27 October 1998 External T.I. 9812975 - COST AMOUNT, RRSP TO RRIF TFR

Unedited CRA Tags
206(4)

Principal Issues: Can property be transferred from an RRSP to a RRIF or from a RRIF to a RRIF at its cost amount for purposes of section 206?

Position: No

Reasons: Position is well established and issue has been referred to the Department of Finance.

26 October 1998 External T.I. 9817915 - MEANING OF DISTRIBUTION - RCA

Unedited CRA Tags
207.5(1)

Principal Issues: Whether an amount paid under an RCA is considered to be a distribution for purposes of withholding tax.

Position: Question of fact.

Reasons: Distribution must meet the terms of the agreement.

26 October 1998 External T.I. E9820425 - EMPLOYER-PAID RRSP'S FEES

Unedited CRA Tags
6(1)(a)

Principal Issues: Will the Department reconsider its position in respect of including employer paid group-RRSP fees as an employment benefit?

Position: No change in position.

Reasons: Amount paid by an employer for the benefit of an employee is considered employment income.

26 October 1998 External T.I. 9820425 - EMPLOYER-PAID RRSP'S FEES

Unedited CRA Tags
6(1)(a)

Principal Issues: Will the Department reconsider its position in respect of including employer paid group-RRSP fees as an employment benefit?

Position: No change in position.

Reasons: Amount paid by an employer for the benefit of an employee is considered employment income.

26 October 1998 External T.I. 9804995 F - CHOIX 45(3) NON PERMIS

Unedited CRA Tags
45(1)a) 45(3) 45(4)

Principales Questions:

Est-ce qu’un contribuable peut se prévaloir du choix prévu au paragraphe 45(3) de la Loi afin de différer l’imposition du gain résultant de la disposition réputée d’une unité locative d’un duplex prévue à l’alinéa 45(1)a) de la Loi en raison d’un changement d’usage?

Position Adoptée:

26 October 1998 External T.I. E9817915 - MEANING OF DISTRIBUTION - RCA

Unedited CRA Tags
207.5(1)

Principal Issues: Whether an amount paid under an RCA is considered to be a distribution for purposes of withholding tax.

Position: Question of fact.

Reasons: Distribution must meet the terms of the agreement.

22 October 1998 External T.I. F9725485 F - VENTE À DÉCOUVERT

Unedited CRA Tags
38 9

Principales Questions:
1. De quelle nature est le gain ou la perte généré par le vendeur lors d’une vente à découvert dans la situation où le vendeur détient déjà des titres identiques qui sont entiercées ?

2. À quel moment le vendeur doit-il constater le gain ou la perte résultant d’une vente à découvert.

Position Adoptée:
1. Habituellement le gain ou la perte sur la vente à découvert est au titre de revenu, toutefois dans la situation présente, ce pourrait être au titre du capital.

22 October 1998 External T.I. 9725485 F - VENTE À DÉCOUVERT

Unedited CRA Tags
38 9

Principales Questions:
1. De quelle nature est le gain ou la perte généré par le vendeur lors d’une vente à découvert dans la situation où le vendeur détient déjà des titres identiques qui sont entiercées ?

2. À quel moment le vendeur doit-il constater le gain ou la perte résultant d’une vente à découvert.

Position Adoptée:
1. Habituellement le gain ou la perte sur la vente à découvert est au titre de revenu, toutefois dans la situation présente, ce pourrait être au titre du capital.

22 October 1998 External T.I. E9823465 - ELIGIBLE & SMALL BUSINESS CORPORATIONS

Unedited CRA Tags
4900(6) 4900(12) 5100(1)

Principal Issues:
1. Are there standards that a trustee has to meet in determining whether shares qualify under 4900(6) or 4900(12)?
2. How to evaluate such shares.

Position:
1. No;
2. Refer to Valuations Sections of TSO.

Reasons:
1. Question of fact, no set standards;
2. Question of fact.

22 October 1998 External T.I. E9816525 - TAXATION OF TRUSTS - GENERAL

Unedited CRA Tags
104

Principal Issues: General comments on taxation of income in a trust where the trust owns shares of a Canadian corporation

Position: General rules under section section 104 and attribution rules

Reasons: consistent with the Department's position on trusts

22 October 1998 External T.I. E9823475 - MANAGEMENT FEES & SWAPS

Principal Issues:
1. Whether the Department's revised position regarding the payment of RRSP or RRIF management fees is in force;
2. What are the tax consequences of swapping securities for cash with your RRSP.

Position:
1. Yes;
2. Disposition at the fair market value.

Reasons:
1. According to our position;
2. Wording of the Act.

22 October 1998 External T.I. 9823465 - ELIGIBLE & SMALL BUSINESS CORPORATIONS

Unedited CRA Tags
4900(6) 4900(12) 5100(1)

Principal Issues:
1. Are there standards that a trustee has to meet in determining whether shares qualify under 4900(6) or 4900(12)?
2. How to evaluate such shares.

Position:
1. No;
2. Refer to Valuations Sections of TSO.

Reasons:
1. Question of fact, no set standards;
2. Question of fact.

22 October 1998 External T.I. 9816525 - TAXATION OF TRUSTS - GENERAL

Unedited CRA Tags
104

Principal Issues: General comments on taxation of income in a trust where the trust owns shares of a Canadian corporation

Position: General rules under section section 104 and attribution rules

Reasons: consistent with the Department's position on trusts

22 October 1998 External T.I. 9823475 - MANAGEMENT FEES & SWAPS

Principal Issues:
1. Whether the Department's revised position regarding the payment of RRSP or RRIF management fees is in force;
2. What are the tax consequences of swapping securities for cash with your RRSP.

Position:
1. Yes;
2. Disposition at the fair market value.

Reasons:
1. According to our position;
2. Wording of the Act.

21 October 1998 External T.I. 9806065 F - POMPIER VOLONTAIRE - ALLOCATION NON IMPOSABLE

Unedited CRA Tags
6(1)b)(viii)

Principales Questions:

Est-ce que les pompiers volontaires réguliers d’une municipalité rémunérés sur une base horaire ont droit à l’allocation non imposable en vertu du sous-alinéa 6(1)b)(viii) de la Loi?

Position Adoptée:

21 October 1998 External T.I. E9813775 - INDIAN ACT EXEMPTION - EMPLOYMENT INCOME

Unedited CRA Tags
81(1)(a)

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

Position: Question of Fact. Do not appear to currently meet any of the guidelines.

Reasons: Less than 50% of the duties of employment are performed on reserve, the employees do not live on reserve, the employer does not appear to be resident on reserve and finally the employer does not appear to exclusively serve Indians who for the most part live on reserve.

21 October 1998 External T.I. 9813775 - INDIAN ACT EXEMPTION - EMPLOYMENT INCOME

Unedited CRA Tags
81(1)(a)

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

Position: Question of Fact. Do not appear to currently meet any of the guidelines.

Reasons: Less than 50% of the duties of employment are performed on reserve, the employees do not live on reserve, the employer does not appear to be resident on reserve and finally the employer does not appear to exclusively serve Indians who for the most part live on reserve.

19 October 1998 External T.I. E9821425 - CONSTRUCTIVE RECEIPT, PHANTOM STOCK PLAN

Unedited CRA Tags
6801(d)

Principal Issues: Would constructive receipt exist where an employee elects not receive property prior to the employee having the right to receive the property.

Position: Generally not.

Reasons: Question of fact but if no right to an amount then how could there be constructive receipt.

19 October 1998 External T.I. 9821425 - CONSTRUCTIVE RECEIPT, PHANTOM STOCK PLAN

Unedited CRA Tags
6801(d)

Principal Issues: Would constructive receipt exist where an employee elects not receive property prior to the employee having the right to receive the property.

Position: Generally not.

Reasons: Question of fact but if no right to an amount then how could there be constructive receipt.

15 October 1998 External T.I. E9812715 - TRAINING BENEFITS RECEIVED BY STATUS INDIANS

Unedited CRA Tags
56(1)(r) 56(1)(n) 81(1)(a)

Principal Issues: Taxability of training benefits received by status Indians which are funded by HRDC.

Position: The taxation depends on the stream of funding as well as the connecting factors.

Reasons: Benefits funded under the EI Act will generally be taxable under 56(1)(r) of the Act. If the training takes place on reserve, the connecting factors may exempt the benefits from taxation pursuant to section 87 of the Indian Act.

15 October 1998 External T.I. 9812715 - TRAINING BENEFITS RECEIVED BY STATUS INDIANS

Unedited CRA Tags
56(1)(r) 56(1)(n) 81(1)(a)

Principal Issues: Taxability of training benefits received by status Indians which are funded by HRDC.

Position: The taxation depends on the stream of funding as well as the connecting factors.

Reasons: Benefits funded under the EI Act will generally be taxable under 56(1)(r) of the Act. If the training takes place on reserve, the connecting factors may exempt the benefits from taxation pursuant to section 87 of the Indian Act.

15 October 1998 External T.I. E9826175 - ACTIVE BUSINESS INCOME

Unedited CRA Tags
125

Principal Issues: A corporation’s profit is attributable to an adventure in the nature of trade. Does the profit qualify for the small business deduction, assuming it otherwise qualifies..

Position: Yes

Reasons: See paragraph 3 of IT-73R5

15 October 1998 External T.I. 9826175 - ACTIVE BUSINESS INCOME

Unedited CRA Tags
125

Principal Issues: A corporation’s profit is attributable to an adventure in the nature of trade. Does the profit qualify for the small business deduction, assuming it otherwise qualifies..

Position: Yes

Reasons: See paragraph 3 of IT-73R5

17 September 1998 External T.I. E9816915 - ACQUISITION OF CONTROL ON AMALGAMATION

Unedited CRA Tags
256(7)(a) 256(7)(b) 251(2) 251(4)

Principal Issues: In an amalgamation, can acquisition of control be avoided pursuant to paragraph 256(7)(a) and (b) of the Act in three specific situations described in the letter.

Position: Specific to each fact situation.

Reasons: See description of fact situations in the technical interpretation.

17 September 1998 External T.I. 9816915 - ACQUISITION OF CONTROL ON AMALGAMATION

Unedited CRA Tags
256(7)(a) 256(7)(b) 251(2) 251(4)

Principal Issues: In an amalgamation, can acquisition of control be avoided pursuant to paragraph 256(7)(a) and (b) of the Act in three specific situations described in the letter.

Position: Specific to each fact situation.

Reasons: See description of fact situations in the technical interpretation.

1 September 1998 External T.I. 9810765 - TAXATION OF XXXXXXXXXX

Unedited CRA Tags
149(1)(c) 149(1)(l)

Principal Issues: Whether the XXXXXXXXXX is exempt from tax.

Position: Perhaps.

Reasons: May qualify under 149(1)(c) or 149(1)(l). To qualify for tax exempt status under paragraph 149(1)(c) of the Act, the XXXXXXXXXX would have to be considered a public body performing a function of government. It is a question of fact whether or not the XXXXXXXXXX is a public body performing a function of government.
To qualify for tax exempt status under paragraph 149(1)(l) of the Act, an association must be both "organized and operated" exclusively for social welfare, civic improvement, pleasure or recreation or for any other purpose except profit. Such a determination cannot be made in advance of or during a particular year, but only after the filing of a return reporting the operations and claiming exemption for the year having ended.

15 July 1998 External T.I. E9816835 - DRAWDOWNS UNDER CREDIT FACILITY

Unedited CRA Tags
212(1)(b)(vii)

Principal Issues: Whether drawdowns under a credit facility are eligible for withholding exemption on interest if credit facility is for a period in excess of 5 years.

Position: No

Reasons: Each drawdown is considered a separate obligation and each must be measured from date of draw to expiry date of facility

15 July 1998 External T.I. 9816835 - DRAWDOWNS UNDER CREDIT FACILITY

Unedited CRA Tags
212(1)(b)(vii)

Principal Issues: Whether drawdowns under a credit facility are eligible for withholding exemption on interest if credit facility is for a period in excess of 5 years.

Position: No

Reasons: Each drawdown is considered a separate obligation and each must be measured from date of draw to expiry date of facility

13 March 1998 External T.I. F9726595 F - WHEN WAS THE LAND DISPOSED OF?

Unedited CRA Tags
54

Principal Issues:

Détermination du moment de la disposition

Position:

Article 54, quand le produit de disposition a été reçu.

Reasons:

13 March 1998 External T.I. 9726595 F - WHEN WAS THE LAND DISPOSED OF?

Unedited CRA Tags
54

Principal Issues:

Détermination du moment de la disposition

Position:

Article 54, quand le produit de disposition a été reçu.

Reasons:

Conference

27 October 1998 Roundtable, E9827766 - TAXABLE BENEFITS - RECREATIONAL FACILITIES

Unedited CRA Tags
6(1)(a)

Principal Issues: Taxability of free passes to a Municipalities recreational facilities.

Position: No taxable benefit.

Reasons: If passes are provided to all employees for use of the employer's recreational facilities, the situation will meet the requirements of paragraph 33 of IT-470R.

Technical Interpretation - Internal

4 November 1998 Internal T.I. F9716367 F - ACTIONS SUBSTITUÉES

Unedited CRA Tags
93(2)

Position Adoptée: Non. Seulement XXXXXXXXXX actions ordinaires parmi les XXXXXXXXXX actions ordinaires détenues par la société B le XXXXXXXXXX constituent des actions substituées aux XXXXXXXXXX actions ordinaires et aux XXXXXXXXXX actions privilégiées de la société C que détenait la société B le XXXXXXXXXX.

4 November 1998 Internal T.I. 9716367 F - ACTIONS SUBSTITUÉES

Unedited CRA Tags
93(2)

Position Adoptée: Non. Seulement XXXXXXXXXX actions ordinaires parmi les XXXXXXXXXX actions ordinaires détenues par la société B le XXXXXXXXXX constituent des actions substituées aux XXXXXXXXXX actions ordinaires et aux XXXXXXXXXX actions privilégiées de la société C que détenait la société B le XXXXXXXXXX.

4 November 1998 Internal T.I. 9809007 F - ART.29P.5 FRANCE-CANADA TREATY

Unedited CRA Tags
147.2(4)a)

Principal Issues: Does a contribution to a French pension plan have to be made in the year the services are rendered in order to be considered as a contribution to a Canadian pension plan, as suggested by the English version of the Canada-France tax treaty?

Position: No, it is not necessary that the contribution be made in the same year as the services rendered.

Reasons:
1. The Commentary on Article 18 (#11) of the Model Tax Convention - OECD - provides that the intent of such a provision is to facilitate the mobility of the employees.

27 October 1998 Internal T.I. 9827766 - TAXABLE BENEFITS - RECREATIONAL FACILITIES

Unedited CRA Tags
6(1)(a)

Principal Issues: Taxability of free passes to a Municipalities recreational facilities.

Position: No taxable benefit.

Reasons: If passes are provided to all employees for use of the employer's recreational facilities, the situation will meet the requirements of paragraph 33 of IT-470R.

21 October 1998 Internal T.I. 9812527 - CONSTRUCTIVE TRUSTS

Unedited CRA Tags
104

Principal Issues: Constructive trusts and the issue of retroactivity

Position: No retroactivity. FMV disposition at the time of the court order.

Reasons: XXXXXXXXXX

6 October 1998 Internal T.I. 9823137 F - INVENTAIRE - SUCCESSION

Unedited CRA Tags
232 231.2

Principales Questions:

Questions reliées aux autorisations nécessaires pour la consultation de l’inventaire établi par le liquidateur d’une succession conformément à l’article 794 du Code civil du Québec lorsque le lieu de consultation est situé chez un notaire.

Position Adoptée:

25 September 1998 Internal T.I. E9815507 - ADVANCES AND LOANS TO EMPLOYEES

Unedited CRA Tags
5(1) 6(1)(a) 6(1)(15.1) 80.4 Regulation 100(1)

Principal Issues: When is an advance on account of employment commissions included in income?
What is the tax consequence of a loan to an employee that is eventually written off?

Position: An advance is included in income when advanced.
Section 80.4 could apply on the loan. Subsection 6(15) would apply when loan has been forgiven.

Reasons: Employment commission is taxable when received by an employee. See cancelled IT-222R.
IT-421R discusses the 80.4 aspect of a loan to an employee. Numerous memoranda on file with respect to the application of 6(15) on forgiven loans.

25 September 1998 Internal T.I. 9815507 - ADVANCES AND LOANS TO EMPLOYEES

Unedited CRA Tags
5(1) 6(1)(a) 6(1)(15.1) 80.4 Regulation 100(1)

Principal Issues: When is an advance on account of employment commissions included in income?
What is the tax consequence of a loan to an employee that is eventually written off?

Position: An advance is included in income when advanced.
Section 80.4 could apply on the loan. Subsection 6(15) would apply when loan has been forgiven.

Reasons: Employment commission is taxable when received by an employee. See cancelled IT-222R.
IT-421R discusses the 80.4 aspect of a loan to an employee. Numerous memoranda on file with respect to the application of 6(15) on forgiven loans.

22 September 1998 Internal T.I. 9820637 - RRIF CONTINUING ANNUITANT

Unedited CRA Tags
146.3

Principal Issues:

Can amounts held in two particular RRIFs at the time of the annuitants death be included in the annuitants income?

Position: Based on available information, No.

Reasons:

22 September 1998 Internal T.I. E9820637 - RRIF CONTINUING ANNUITANT

Unedited CRA Tags
146.3

Principal Issues:

Can amounts held in two particular RRIFs at the time of the annuitants death be included in the annuitants income?

Position: Based on available information, No.

Reasons:

22 June 1998 Internal T.I. 9801667 F - DÉPENSES - CESSATION DE L'ENTREPRISE

Unedited CRA Tags
18(1)a) 20(16) 20(1)a)

Principales Questions:

* Est-ce que les dépenses suivantes réclamées par le contribuable après qu’il a cessé d’exploiter son entreprise sont déductibles en vertu des alinéas 18(1)a) et 20(1)a) de la Loi :

loyers;
pertes finales;
déductions pour amortissement.

* Est-ce que les dépenses d’entretien engagées par un contribuable relativement à un immeuble sont déductibles en vertu de l’alinéa 18(1)a) de la Loi si cet immeuble a été reçu par le contribuable en paiement d’un compte à recevoir et que le contribuable n’utilise pas l’immeuble dans le cadre de l’exploitation de son entreprise?

Position Adoptée:

9 June 1998 Internal T.I. 9812576 - RRSP, DEATH OF ANNUITANT

Unedited CRA Tags
146(8.8)

Principal Issues:
Will subsection 146(8.8) apply where the annuitant died before June 30, 1978?

Position: No

Reasons: The provision clearly only applies to deaths after June 29, 1978.

7 April 1998 Internal T.I. 9803857 F - RENONCATION A DES MONTANTS EXCÉDENTAIRES

Unedited CRA Tags
66(12.73) 66(12.74) 66(12.741) 66(12.61) 163(2.2)

Principales Questions:

1. Peut-on appliquer la pénalité prévue au paragraphe 66(12.75) de la Loi relativement à l’état des corrections à la renonciation présenté pour l’année 1995?

2. Peut-on appliquer la pénalité pour renonciation tardive relativement à la renonciation faite à l’égard des frais d’exploration au Canada engagés par la société en XXXXXXXXXX ?

3. Est-ce que la production d’une renonciation tardive pourrait entraîner l’obligation légale de reconnaître les nouvelles déductions pour les investisseurs au cours de l’année subséquente?

4. Est-ce que vous pouvez renoncer ou annuler la pénalité prévue au paragraphe 163(2.2) de la Loi?

Position Adoptée:

30 November 1997 Internal T.I. 972680A - SUPPLEMENTAL RETIREMENT ARRANGEMENT; RCA, SDA

Unedited CRA Tags
248

Principal Issues: Supplemental Retirement Arrangement - Change of Facts

Position: No change to the rulings provided

Reasons: Changes do not cause the arrangement to be a RCA or SDA

Ministerial Letter

16 October 1998 Ministerial Letter 9824318 - BUDGET CHANGES TO MOVING EXPENSES

Unedited CRA Tags
62 6

Principal Issues: 98 budget amendment to moving reimbursement

Position: finance issue

Reasons: change in Act

16 October 1998 Ministerial Letter 9825888 F - VIVAIT SÉPARÉ - 56(1)B) ET 60B)

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

Principales Questions:
Est-ce que deux personnes vivant sous le même toit peuvent « vivre séparées » pour les fins de l’application des alinéas 56(1)b) et 60b) de la Loi concernant les pensions alimentaires dans la situation particulière soumise.

Position Adoptée:
Non.

14 October 1998 Ministerial Letter 9823098 - TRUST LEAVING CANADA

Unedited CRA Tags
104

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.

XXXXXXXXXX

Dear XXXXXXXXXX :

The Honourable Herb Dhaliwal, Minister of National Revenue, has asked me to reply to your letter of July 19, 1998, concerning the taxation of property when the owner leaves Canada.

29 September 1998 Ministerial Letter 9803558 - ENTERTAINMENT EXPENSES 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.

September 29, 1998

XXXXXXXXXX

Dear Sirs:

17 August 1998 Ministerial Letter 9816768 - MUNICIPAL TAXES ON COTTAGE PROPERTY

Unedited CRA Tags
40(1) 53(1)

Principal Issues: tax treatment of municipal taxes, including road upgrade assessments, on cottage

Position: non-deductible as no income earning purpose, and not added to ACB of cottage, as road upgrades are publicly owned

Reasons: