23 November 2000 Internal T.I. 2000-0047877 - WITHDRAWALS UNDER HOME BUYERS' PLAN

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

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 Issues: If a taxpayer withdraws an amount under the Home Buyers' Plan in year 1, then a second amount in January of year 3, will the second amount be an "excluded withdrawal" by virtue of subparagraph 146.01(2)(d)(iii)?

Position: No

Reasons: Subparagraph 146.01(2)(d)(iii) deems the amount received in January of year 3 to have been received in year 2. But the receipt in year 2 would still have to meet the requirements of section 146.01 in and of itself.

			November 23, 2000

	HEADQUARTERS	HEADQUARTERS
	IRRP Directorate	Income Tax Rulings
	Pensions & Trusts Section	  Directorate
	8th Floor, Tower C, Place Vanier	S.E. Thomson
			952-9853
	Attention:  Kevin Stackhouse
			2000-004787

XXXXXXXXXX - Home Buyers' Plan Withdrawals

As discussed by telephone, we are forwarding a request for a technical interpretation dated September 20, 2000 from XXXXXXXXXX on behalf of the above taxpayer. As outlined in the request, the taxpayer withdrew an amount under the Home Buyers' Plan in 1996, and a second amount in January, 1998. The Canada Customs and Revenue Agency has included the second amount in the income of the taxpayer as a withdrawal from a registered retirement savings plan that was not an "excluded withdrawal" as defined in subsection 146.01(1) of the Income Tax Act (the "Act").

Since the Assessment & Collections Branch has the responsibility to administer amounts received under the Home Buyers' Plan, we are forwarding the request to you to respond.

However, with respect to the views expressed in the request, we would like to point out that, in our view, the second withdrawal would not be an "excluded withdrawal", even though it may meet the requirements of subparagraph 146.01(2)(d)(iii). That is, subparagraph 146.01(2)(d)(iii) deems the 1998 payment to be paid in 1997, but in our view, a payment in 1997 would not be an "excluded withdrawal" where the taxpayer had a HBP balance at the beginning of 1997. An "excluded withdrawal" is defined in subsection 146.01(1) of the Act to include an "eligible amount" received by an individual. An "eligible amount" is defined in subsection 146.01(1) to include a "regular eligible amount", and as set out in paragraph (i) of the definition of "regular eligible amount", as also defined in subsection 146.01(1) , the individual must not have a HBP at the beginning of the calendar year.

R. Albert, CA
for Director
Financial Industries Division
Income Tax Rulings Directorate