Income Tax Severed Letters - 1999-05-28

Miscellaneous

21 April 1999 Miscellaneous 9907486 - MOVING EXPENSES

Unedited CRA Tags
62(3)(g)

Principal Issues:
The taxpayer is eligible to claim moving expenses in 1997 as a result of relocating for employment reasons. He borrowed funds (bridge loan) to purchase a new residence pending the closing of the sale of his old residence. There was a delay between the time the funds were available on the closing date and the date of registration of the deeds for the purchase of the new residence and the sale of the old residence. The lawyer held the funds during the mentioned period until the registration date.
(1) Is the interest paid in 1997 on the bridge loan deductible as a moving expense?
(2) Should the interest earned on the sales proceeds of the old residence be included in computing income without being offset by the interest paid on the bridge loan?

Position:
(1) No
(2) Yes.

Reasons:
(1) Interest costs on the purchase of the new residence do not qualify as moving expenses as this term is defined in subsection 62(3) of the Income Tax Act (“Act”). The proposed tax amendment resulting from the 1998 Federal budget to treat up to $5,000 of interest costs and some other expenditures as moving expenses does not apply to 1997 but only applies in respect of expenses incurred in 1998 and subsequent years; furthermore, the interest costs referred to in the proposed tax amendment are those incurred in respect of the old residence (not the new residence) while it is vacant and for sale.
(2) Interest earned on the sales proceeds of the old residence is to be included in income pursuant to paragraph 12(1)(c) of the Act ( as income from property in this case). Such interest income cannot be offset by any of part of the interest paid on the bridge loan: the interest expense on the bridge loan was not laid out for the purpose of earning the interest income, as required by paragraph 20(1)(c) of the Act, and its deduction from income is prohibited by paragraph 18(1)(h) of the Act on the basis that it is a personal expense relating to personal-use property (the new residence).

April 21, 1999

5 February 1998 Miscellaneous 9642016 - INVESTMENT TAX CREDIT - PARTNERSHIPS

Unedited CRA Tags
127(8.4) 127(8) 127(8.3)

Principal Issues: Whether 127(8.4) election is available in the case of a partnership with no specified members (i.e., a general partnership).

Position: No.

Reasons: To qualify, amounts must be required to be added to partners' ITC pursuant to both 127(8) and (8.3). If no specified members, (8.3) is not applicable.

10 October 1997 Miscellaneous 9M19030 F - APFF 1997 TABLE RONDE

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.

TABLE RONDE SUR LA FISCALITÉ FÉDÉRALE

APFF - CONGRES 1997

INDEX

Ruling

1999 Ruling 9824473 - WIND-UP OF A TRUST

Unedited CRA Tags
107 106

Principal Issues: 1. Will 107(2) apply to the distribution to the Widow? 2. Will the Children be considered to have disposed of their interests in the Trust? 3. Will 106(3) apply to the Trust?

Position: 1. Yes. 2. Yes but for no proceeds of disposition for the purpose of 107(1). 3. No.

Reasons: 1. After the release of the Children's interests in the Trust, the Widow is the sole beneficiary under the Trust. 107(2) and not 106(2) applies. 2. Valid releases of the Children's capital interests. Consistent with the position in IT-385R2 for releases of income interests. 3. 107(2) and not 106(2)or 106(3) applies when there is only one beneficiary under the Trust.

1999 Ruling 9900563 - ATR AMENDMENT - 6801(D)

Unedited CRA Tags
6801(d)

Principal Issues:

Whether Old Ruling still binding if Directors elect before the Corporation’s annual meeting instead of before December 31 each year?

Position:

Yes.

Reasons:

1999 Ruling 990115A - 21-YEAR RULE

Unedited CRA Tags
104(4) 107 106

Principal Issues: Supplemental to Ruling 982495. The shares to be redeemed will be purchase for cancellation.

Position: Ruling will continue to be binding. The changes are not significant enough
to effect the rulings given.

Reasons:

1998 Ruling 9816063 - 110.1(3),110.1(6), 118.1(13)(A)

Unedited CRA Tags
110.1(3) 110.1(6) 118.1(13)(a)

Principal Issues: Issues related to non-qualifying security gift made by a taxable Canadian corporation to a U.S. Foundation. (See Statement of Principal Issues attached with Ruling)

Position: (See Statement of Principal issues attached with Ruling)

Reasons: (See Statement of Principal Issues attached with Ruling)

1998 Ruling 9824953 - 21-YEAR RULE

Unedited CRA Tags
104(4) 106(3) 107(2)

Principal Issues: 1. Will 107(2) of the Act apply to the distribution of shares to the Grandchildren? 2. Will 106(3) apply to the Trust as a result of the proposed transactions? 3. Will GAAR apply to the proposed transactions?

Position: 1. Yes. 2. Yes. 3. No.

Reasons: 1. Consistent with previous rulings in the context of the 21-year rule and Finance's technical notes. 2. The "Constructive receipt" argument applied to the situation. Consistent with our position re 104(6) and 104(24) of the Act w.r.t. trusts for minors set out in Technical News #11. Payment made by the Trust to an insurance company to purchase an annuity with the Daughter's attorney's written consent and direction.

1998 Ruling 9829473 - 6801 (D) PLAN

Unedited CRA Tags
6801(d)

Principal Issues:

Whether arrangement is exempted from SDA definition by virtue of 6801(d);

Position:

Yes; however, tax withholding on payments to non-residents will be made pursuant to Reg. 103 and not Reg. 105 as initially requested by the client.

Reasons:

1998 Ruling 9803793 F - ÉCHANGE DU PBR SUR ACTIONS EN BILLET

Unedited CRA Tags
84.1 245 84(3) 20(1)(c) 110.6

Principal Issues: Voir sommaire des principales questions

Position: Voir sommaire des principales questions

Reasons:

Technical Interpretation - External

20 May 1999 External T.I. 9911715 - PART-TIME STUDENTS

Unedited CRA Tags
118.6 118.5

Principal Issues:
A contemporary dance school whose Senior Dance Program is certified by the Minister of Human Resources Development has requested our opinion on the flexibility of the guidelines regarding the possible certification of their Junior Dance Program for the purposes of the part-time education tax credit.

20 May 1999 External T.I. 9901115 - GIFT OF A PRIVATE CORPORATION SHARES

Unedited CRA Tags
118.1

Principal Issues: Are the shares of a private corporation that is controlled by an individual that are to be gifted to a registered charity pursuant to the terms of an individual's will on death non-qualifying securities such that subsection 118.1(5) of the Act will not apply?

Position: Question of fact since it involves a determination as to whether the individual's estate would be dealing with the corporation after the time the gift is made. However, assuming the estate is arm's length with the corporation after the gift is made the shares would not be non-qualifying securities.

Reasons: For the purpose of the definition of non-qualifying security in subsection 118.1(18) the relationship must be determined after the gift is actually made to the registered charity and not when the gift would otherwise be deemed to be made.

19 May 1999 External T.I. 9906765 - TELEPHONE EQUIPMENT - EXEMPT PROPERTY

Unedited CRA Tags
110(1.13)(a)(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.

PRINCIPAL ISSUE:

Whether telephone equipment generally used in an office constitutes exempt property pursuant to subparagraph 1100(1.13)(a)(i) of the Regulations.

Position TAKEN:

Yes.

REASON FOR POSITION TAKEN:

Legislative analysis.

19 May 1999 External T.I. 9902345 - REGULATION 8504(6) PRE-1990 BENEFITS

Unedited CRA Tags
8504(6)

Principal Issues: Unfair application of Regulation 8504(6)

Position: We must administer the Act as it is written.

Reasons: Explained the law and referred taxpayer to finance

19 May 1999 External T.I. 9908845 - MUNICIPAL OFFICER'S EXPENSE ALLOWANCE

Unedited CRA Tags
81(3)

Principal Issues: Whether an allowance will be exempt under subsection 81(3).

Position: Yes, to the extent permitted in IT-292.

Reasons: Paragraphs 6 & 7 of IT-292 provide some administrative relief.

19 May 1999 External T.I. 9903475 - CHANGE OF TRUSTEE - CREATION OF NEW TRUST

Unedited CRA Tags
54

Principal Issues: Change of trustee - does trust cease to exist

Position: Where terms of trust allow for a change of trustees, generally the trust would not cease to exist.

Reasons: Trust law, contract law and definition of "dispostion".

19 May 1999 External T.I. 9910585 - STRUCTURED SETTLEMENT

Unedited CRA Tags
3 56(1)

Principal Issues:
An individual wants us to allow revision of a structured settlement by commuting the annuity providing the lump sum payments.

19 May 1999 External T.I. 9907965 - CAPITAL GAINS/ JOINT TENANTS

Unedited CRA Tags
54 70(5)

Principal Issues:
An individual is considering a joint tenancy arrangement to avoid probate fees by adding the son to an account currently in the names of the father and mother. He plans to recognize capital gains on the original allocation to the son (1/3), on the death of the 1st parent (1/6) and the remainder (1/2) on the death of the remaining parent. These calculations are based on the capital gains remaining static throughout the period under consideration. He would like an accounting and legal opinion of the transaction.

18 May 1999 External T.I. 9908365 - UNUSED TUITION AND EDUCATION TAX CREDITS

Unedited CRA Tags
118.61

Principal Issues:
A tax professional has requested clarification of the carry forward of unused tuition and education tax credits pursuant to section 118.61 of the Act. This section does not seem to agree with Schedule 11, a calculation form for an individual’s 1997 and 1998 income tax returns.

18 May 1999 External T.I. 9830205 F - FUSION HORIZONTALE

Unedited CRA Tags
87(4)

Principal Issues: Est-ce que 87(4) permet d'additionner le PBR des actions annulées lorsqu'il y a une fusion horizontale simplifiée et que les actions de la société issue de la fusion sont uniquement des actions ordinaires?

Position: Oui

Reasons: Lien entre 87(1.1), 87(1) et 87(4).

18 May 1999 External T.I. 9908375 - EMPLOYER REIMBURSEMENT OF MORTGAGE INSURANCE

Unedited CRA Tags
6(23)

Principal Issues: Is employer payment of cost of "mortgage default insurance" a taxable benefit?

Position: Yes

Reasons: Not specifically exempted by 98-99 Employers' Guide to Payroll Deductions; Taxable benefits:
Discussed with Trust Accounts, and they are not willing to expand list of exemptions at this point.
Amount is included as a benefit by legislation.

18 May 1999 External T.I. 9902165 - YEAR 2000 (Y2K) COMPUTER COMPLIANCE - CCA

Unedited CRA Tags
20(1)(a) Reg. 1100(1)(zg) Reg. 1100(1)(zh)

Principal Issues: Whether partnership will be eligible for accelerated CCA for replacement computer which is year 2000 compliant.

Position: No.

Reasons: The present computer was not acquired by the partnership before 1998.

17 May 1999 External T.I. 9902845 - STATUS AS A NPO - 149(1)(L)

Unedited CRA Tags
149(1)(l)

Principal Issues: Will the corporation qualify as a non-profit organization under 149(1)(l) after certain transactions are undertaken?

Position: Must make a ruling request.

Reasons: We do not have sufficient facts, documentation or a submission to make a determination that after the proposed transactions are completed the activities will not be carried out on a for profit basis.

17 May 1999 External T.I. 9907145 - HBP - LIVING IN A GARAGE

Unedited CRA Tags
146.01

Principal Issues:
(1) Whether a garage is a qualifying home for the purposes of the Home Buyer's Plan (HBP);

and

(2) whether it would prevent the owner to participate in the HBP.

Position:
(1) No.
(2) No.

Reasons:
The ownership of the garage would not prevent an individual from participating in the HBP, since the garage would generally not be considered to
be a housing unit for these purposes.

17 May 1999 External T.I. 9833895 - RETIRING ALLOWANCE - ACCRUING HEALTH BENEFITS

Unedited CRA Tags
60(j.1)

Principal Issues:

Whether an employee has retired when subsequent consulting may occur and employee continues to receive health benefits.

Position:

Question of fact, but probably yes.

Reasons:

17 May 1999 External T.I. 9901755 - 6205(2) OF REGULATIONS

Unedited CRA Tags
6205(2)

Principal Issues: Various issues relating to subsection 6205(2) of the Income Tax Regulations:

17 May 1999 External T.I. 9908125 - EMPLOYER-PAID EDUCATION COSTS

Unedited CRA Tags
6(1)(a)

Principal Issues:
(1) Would payments made to, or on behalf of an employee for tuition fees be a taxable benefit to the employee?
(2) Would payments made to, or on behalf of an employee for books and related supplies be a taxable benefit to the employee?
(3) Is there a relevant maximum or minimum amount for (1) or (2)?
(4) Please cite the relevant authority under the Income Tax Act &/or Regulations which pertain to (1) or (2).

Position:

(1) & (2): It depends on whether the employer or employee receives the primary benefit.
(3) No.
(4) 6(1)(a) of the Act.

Reasons:

14 May 1999 External T.I. 9827875 - TUITION

Unedited CRA Tags
118.5

Principal Issues: Two educational institutions (“Institution A” and “Institution B”) jointly deliver XXXXXXXXXX courses with each institution carrying out certain functions. Each institution determines the quantum of the registration fee required for its particular functions. It is our understanding that the courses are not at a post secondary level for the purposes of subparagraph 118.5(1)(a)(ii.1) of the Act as they are available to a student as long as the student is at least 18 years of age. Institution A, which collects the registration fee and remits the relevant portion to Institution B is described in subparagraphs 118.5(1)(a)(i) and (ii) (i.e., certified by the Minister of Human Resources Development) of the Act, while Institution B is described in subparagraph 118.5(1)(a)(ii) of the Act.
Institution A promotes the courses, purchases the course material (including books), hires instructors from a list provided by Institution B, provides examination supervisors, and provides the facilities where the examinations are written and the courses are taught. Institution B prepares and marks the examinations, prepares the instructors, and develops the courses. We have been asked whether a receipt for income tax purposes (i.e, the tuition tax credit) can be issued with respect to these costs. We have also been asked whether the cost of a license charged to a student by Institution B can be included on the receipt.

Position: The receipt should not include the cost of the course material and books, or the cost of the license. The fact that a portion of the fees to be charged in respect of courses are determined by reference to the costs of developing courses and preparing instructors, would not, in an by itself, prevent the fees from being regarded as being tuition.

Reasons: It is the Department’s general position that “tuition” refers to instruction. Also, see paragraphs 26 to 28 of IT-516R2. It is also noted that the circumstances of this situation (including the point that only one institution would issue a tuition receipt for income tax purposes in respect of tuition fees relating to both institutions) were discussed with Diane Waterfield of the Assessing and Collections Directorate who did not feel that there were any problems. Ms. Waterfield also confirmed that XXXXXXXXXX has been certified. XXXXXXXXXX has confirmed, in a telephone conversation, that XXXXXXXXXX has also been certified.

13 May 1999 External T.I. 9912425 - XXXXXXXXXX STATUS INDIANS EMPLOYEES

Unedited CRA Tags
81(1)(a) 6(1)(a)

Principal Issues:
Tax status of various Indian employees of XXXXXXXXXX store in XXXXXXXXXX per cent of a Commercial Complex is on a reserve but a store which is part of the Commercial Complex is entirely off the reserve. Are the employees of the store taxable on their employment income?

Position:
Application of Indian Act Exemption Guidelines.

Reasons:
In this situation, Guidelines 2 and 4 would not apply as the XXXXXXXXXX is not an employer resident on a reserve. In addition, although the lease agreement indicates that part of the Commercial Complex is partly on the reserve, it also indicates that the XXXXXXXXXX store is entirely off the reserve. Accordingly, the employees of the store would not be employees working on a reserve. Therefore, since none of the XXXXXXXXXX store’s employees perform their employment duties on a reserve, Guideline 3 or Guideline 1 and its proration rule do not apply. In the event that there is a public commitment by DIAND to convert this land to reserve land and the boundaries are established, procedures can be undertaken to treat the land as a reserve until it actually becomes a reserve. Comments were also provided based on the assumption that XXXXXXXXXX % of the store was on reserve and employees worked throughout it.

13 May 1999 External T.I. 9815955 F - FAMILLES D'ACCUEIL

Unedited CRA Tags
81(1)h)

Principales Questions:
Les montants qu'une personne responsable d'une famille d'accueil reçoit pour prendre soin d'un groupe de bénéficiaires, sont-ils imposables?

Position Adoptée:
Commentaires généraux.

6 May 1999 External T.I. 9906955 - PRINCIPAL RESIDENCE - BENEFICIAL OWNERSHIP

Unedited CRA Tags
54 (Disposition)

Principal Issues: For personal reasons, an individual (“Individual A”) transferred the legal ownership of a property (land on which his residence was located) to his son-in-law (“Individual B”) in XXXXXXXXXX which was to be held “In Trust” until such time as Individual B was advised by Individual A on how to deal with the property. Individual A now wishes to have the legal ownership of the property registered in his name. Is there a disposition?

Position: Likely not

Reasons: The available information indicated that a bare trust described in Technical News No. 7 is in existence. Accordingly, if legal ownership is registered in respect of Individual A, it appears that there would be no change in beneficial ownership.

6 May 1999 External T.I. 9905495 - DESIGNATED SHAREHOLDER CLASS OF SHARES

Unedited CRA Tags
4901(2)

Principal Issues:
When determining whether a shareholder is a designated shareholder can you consider all shares with the same rights as one class of shares?

Position: No.

Reasons:
Subsection 4901(2) of the Regulations clearly states that each class of shares is looked at separately.

16 April 1999 External T.I. 9905435 - PRE-DETERMINED PAYMENTS

Unedited CRA Tags
118.2(2)(h)

Principal Issues: Payment by a PHSP of a pre-determined daily amount for accommodation.

Position: The patient must show that the accommodation expenses are actually incurred.

Reasons: Paragraphs 34, 35 and 68 of IT-519R2.

31 March 1999 External T.I. 9905235 - MEDICAL EXPENSES

Unedited CRA Tags
118.2(2)(a)

Principal Issues: Whether particular invoice items qualify as medical expenses.

Position: General comments only.

Reasons: Must meet conditions in subsection 118.2(2) of the Act.

22 September 1998 External T.I. 9822350 - REASONABLE EXPECTATION OF PROFIT

Unedited CRA Tags
9(1) 18(1)(h) 67

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.

CANADIAN TAX FOUNDATION ROUND TABLE
1998 ANNUAL CONFERENCE

SUBJECT: Reasonable Expectation of Profit - the Saga Continues

Issue:

Is there a reasonable expectation of profit (“REOP”) in essentially all deduction cases? Various cases from Tonn forward have sewn confusion.

27 March 1998 External T.I. 9719365 - CLASS 34 - TAXPAYER

Unedited CRA Tags
Class 34 - schedule II paragraph (j)

Principal Issues: Whether a reference to a "taxpayer" includes a partnership in draft paragraph (j) of Class 34 of Schedule II of the Regulations.

Position: Yes.

Reasons: We have taken the position that a partnership is a "person" for purposes of computing its Part I income and the classification of depreciable property is such a purpose. Per 248(1), "taxpayer" includes any person ...

Conference

9 October 1998 APFF Roundtable Q. 1, 9M18970 F - APFF 1998 TABLE RONDE

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.

TABLE RONDE SUR LA FISCALITÉ FÉDÉRALE
APFF - CONGRÈS 1998

Question 1

Application de l’article 43.1 au Québec

10 October 1997 APFF Roundtable Q. 1, 9M19020 - APFF 1997 TABLE RONDE

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.

FEDERAL ROUND TABLE ON TAXATION

1997 APFF CONFERENCE

INDEX

Technical Interpretation - Internal

25 May 1999 Internal T.I. 9910577 - VOLUNTEER DEDUCTION FROM EMPLOYMENT INCOME

Unedited CRA Tags
8(1)(a)

Principal Issues: Is volunteer director of emergency social services eligible for 8(1)(a) deduction?

Position: Question of fact, but likely.

Reasons: The information is incomplete but based on what was sent he likely meets the criteria.

18 May 1999 Internal T.I. 9830927 - LOSS ON GUARANTEE

Unedited CRA Tags
40(2)(g)(ii)

Position:
Subparagraph 40(2)(g)(ii) of the Act applies to deny the capital loss.

18 May 1999 Internal T.I. 9910047 - EMERGENCY VOLUNTEER DEDUCTION

Unedited CRA Tags
8(1)(a)

Principal Issues: Is volunteer employee of private ambulance company entitled to 8(1)(a) deduction.

Position: No

Reasons: Employer must be government, municipality or public authority; unless private company is agent for municipality, there is no deduction.

7 May 1999 Internal T.I. 9908197 - DEATH BENEFIT

Unedited CRA Tags
153(1) 248(1)

Principal Issues: Does regulation 200(1) require a payer of a death benefit to report the gross amount of a death benefit (as defined in paragraph 1 of IT-508R) on a T4A, or the death benefit as calculated under 248(1), which excludes the non-taxable portion of the death benefit. Regulation 200(1) states that a person making a payment described in subsection 153(1) of the Act shall make an information return in prescribed form in respect of such payment. The regulation does nor refer to prescribed information.

Position: Yes.

Reasons: The regulation states to use the prescribed form. The instructions for completing the prescribed form, in this case, are found in the Employers' Guide to Payroll Deductions, which states to report the gross amount of the death benefit. on the T4A.

6 May 1999 Internal T.I. 9908017 - INDIAN EMPLOYMENT ON INUIT LAND

Unedited CRA Tags
81

Principal Issues: Indian employment income exemption

Position: Not exempt

Reasons: Duties off reserve; employer not resident on reserve.

20 April 1999 Internal T.I. 9828877 F - CREDIT ÉQUIVALENT POUR PERSONNE À CHARGE

Unedited CRA Tags
118(1)b)(ii)

Principales Questions: Crédit à 118(1)b) permis pour un parent en séjourr?

Position ADOPTEES: Non- si le parent est un non-resident

Raisons: IT- 221R2, no 18 IT-513R

14 April 1999 Internal T.I. 9831627 F - INTEREACTION 1100(11) ET 13(21.2)E)(III)

Unedited CRA Tags
13(21.2)

Principal Issues: Les dispositions du para 1100(11) du Reg. s'appliquent-elles au bien hypothetique du para 13(21.2)e)(iii)

Position: non

Reasons: Le libellé du sous-alinéa 13(21.2)e)(iii) de la Loi prévoit que le cédant est réputé acquérir un bien de la même catégorie que celle du bien cédé. Ce sous-alinéa ne prévoit pas que le cédant est réputé acquérir le même bien ni que le bien hypothétique est utilisé au même fins que le bien cédé.

14 April 1999 Internal T.I. 9901637 F - CATEGORIE 41 -LIE A SOI MEME

Unedited CRA Tags
20(1)(A)

Principal Issues: cat 41 - lien de dépendance

Position: un contribuable n'est pas réputé être lié à lui-même pour les fins de la cat. 41

Reasons: Un contribuable est réputé être lié à lui-même seulement lorsque la Loi le prévoit expressément. Position réitérée par le ministère des Finances (conversation informelle)

10 February 1999 Internal T.I. 9829297 F - SÉCHOIRS A BOIS - AMORTISSEMENT

Unedited CRA Tags
20(1)(a)

Principales Questions: séchoir à bois - catégorie d'amortissement

Position Adoptée: cellules de séchage = cat. 8 alinéa c) et les immobilisations pour produire vapeur cat. 8 alinéa i) sauf si principalement pour séchage du bois = cat. 8 alinéa c)

21 January 1999 Internal T.I. 9900197 F - DÉDOMMAGEMENT PAYÉ À UN LOCATAIRE

Unedited CRA Tags
18(1)a)

Principales Questions: Traitement fiscal pour le locataire et le propriétaire des dommages-intérêts reçus suite à un jugement rendu par la Régie du logement du Québec.

Position Adoptée: Propriétaire: Pas de déduction pour les montants versés à titre de dommages moraux et exemplaires. La nature du paiement versé pour dommages directs et réels doit être établie selon la nature des travaux de réfection effectués par le propriétaire. Les travaux entrepris semblent constituer des dépenses de nature capitale donc ce paiement est également de nature capitale: le propriétaire peut donc l’ajouter au coût en capital de son immeuble. Les intérêts payés ainsi que les frais légaux raisonnables encourus en raison du litige sont considérés comme une composante du dédommagement pour le propriétaire. Donc pas de déduction des intérêts et frais légaux mais une portion est capitalisable. Locataire: Un dédommagement sera considéré comme étant du revenu si le montant reçu constitue une compensation pour une perte de revenu de bien, d’entreprise ou d’emploi. Donc, seulement le montant versé pour la perte de revenu provenant du colocataire pourrait être attribuable à une perte d’un revenu de bien. Le paragraphe 12 du IT-396R prévoit essentiellement qu’un bénéficiaire doit inclure dans ses revenus les intérêts qui sont ajoutés à une indemnité pour dédommagement. Le paragraphe 4 du IT-365R2 mentionne que les intérêts reçus suite à un jugement rendu par un tribunal ou en vertu d’un règlement à l’amiable ne constituent pas un revenu pour le bénéficiaire lorsque ces intérêts sont d’une part, antérieurs à la date du jugement ou de l’accord et sont d’autre part, ajoutés à une indemnité accordée pour blessures ou pour décès. Cette position est étendue aux intérêts antérieurs à la date de jugement sur des indemnités pour congédiement illégal et pour dommages-intérêts en vertu de la Commission de la Sécurité professionnelle et de l’assurance contre les accidents de travail. Les intérêts reçus relativement au paiement versé pour dommages moraux, directs et réels constituent un revenu pour le locataire. Si des intérêts, antérieurs à la date de jugement, sont attribuables à l’indemnité versée en vertu de la Charte québécoise des droits et libertés le paragraphe 4 du IT-365R2 pourrait s’appliquer à ces intérêts puisque le montant est versé pour compenser le locataire des blessures personnelles résultant d’une atteinte illicite à un ou plusieurs droits établis en vertu de la Charte québécoise des droits et libertés.

6 January 1999 Internal T.I. 9816727 F - METHODE DE REMPLACEMENT- MATERIEL CONSOMME

Unedited CRA Tags
37(8)(a)(ii)(B)(V) 127(27)

Principales Questions:
1- Quel sens doit-on donner au mot « coût » pour les fins de la subdivision 37(8)a)(ii)(B)(V) de la Loi? 2- Les salaires et les frais généraux engagés par le contribuable pour fabriquer la partie composante du moteur font-ils partie du coût du matériel visé au nouveau paragraphe 127(27) de la Loi tel que proposé dans l’Avis de motion de voies et moyens du 10 décembre 1998 (le « nouveau paragraphe 127(27) de la Loi ») ? 3- Un contribuable développe un nouveau produit chimique pour traiter le bois. Est-ce que le bois utilisé pour les essais constitue du matériel ou des fournitures pour les fins de la subdivision 37(8)a)(ii)(B)(V) de la Loi?4- Est-ce que les animaux utilisés pour les essais constituent du matériel ou des fournitures pour les fins de la subdivision 37(8)a)(ii)(B)(V) de la Loi?

Position Adoptée:
1- Considérant que les tribunaux retiennent l’approche téléologique en matière d’interprétation fiscale, nous sommes d’avis que le nom « coût » tel qu’utilisé à la subdivision 37(8)a)(ii)(B)(V) de la Loi peut prendre le sens de coût de production soit, le prix de revient industriel d’une marchandise. 2- Nous sommes d’avis que les dispositions prévues par ce nouveau paragraphe ne s’appliqueront pas aux salaires et aux frais généraux engagés pour la conception de la partie composante du moteur puisque ces frais sont attribuables à un bien fabriqué par le contribuable. Ces frais ne sont donc pas attribuables à un bien acquis d’une personne ni d’une société de personnes. 3-Oui 4 - oui

7 December 1998 Internal T.I. 9819787 F - REDEVANCES RECEVABLES, FONDS PUBLICITÉ

Unedited CRA Tags
12(1)b) 12(1)g) 18(9)

Principales Questions:
* Est-ce que les redevances recevables à la fin d’une année d’imposition doivent être incluses dans le revenu en vertu de l’alinéa 12(1)b) de la Loi ou si l’alinéa 12(1)g) de la Loi permet de déclarer ces redevances seulement dans l’année où elles sont reçues.

* Est-ce que les contributions du contribuable et des franchisés au fonds de publicité sont déductibles dans l’année s’il existe un surplus dans le fonds de publicité à la fin de l’année.

Position Adoptée:
1. Les redevances recevables doivent être incluses dans le revenu en vertu du paragraphe 9(1) et de l’alinéa 12(1)b) de la Loi.

Ministerial Letter

11 May 1999 Ministerial Letter 9826888 F - DOMMAGES

Unedited CRA Tags
9

Principales Questions: Imposition de dommages

Position Adoptée: Commentaires généraux

27 April 1999 Ministerial Letter 9908788 F - AVOCATS NOMMÉS À LA MAGISTRATURE

Unedited CRA Tags
24.1 34.2(6)

Principales Questions:
Demande d’information concernant les implications fiscales possibles lorsqu’un avocat est nommé à la magistrature fédérale dans une année donnée.

Position Adoptée:
Commentaires généraux.