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: Does the expression "total available days" in subsection 6(2) of the Income Tax Act include all the days in the year an employee has possession of an employer-provided automobile rather than just the specified period the employee is authorized to use the automobile for personal use.
Position: The expression would include each day of the year the employee has possession of the automobile.
Reasons: Position set out in paragraph 11 of IT-63R5 which states, in part, "The total number of days includes the first day during which the automobile is so made available and each day thereafter until such time as the employee is required by the employer to return the automobile and the control over its use to the employer or a person related to the employer. An automobile is available to the employee if it is used by the employee all day or for any part of the day or even if the automobile sits unused in the employee's garage or on the employee's driveway or parking spot."
XXXXXXXXXX 2001-006531
J. E. Grisé
January 29, 2001
Dear Sir:
Re: Standby Charge
This is in reply to your letter of January 8, 2001, requesting clarification of the expression "total available days" for the purpose of calculating the reasonable standby charge pursuant to subsection 6(2) of the Income Tax Act.
You describe the situation where an employee may be authorized to use an employer-provided automobile for personal use during specified periods only (e.g. January through April). For the remainder of the year, the employee can use the employer-provided automobile but solely for business purpose as personal use is not authorized. The total personal use kilometers exceed 10% of the total kilometers driven by the employee based on the entire calendar year of the automobile use.
As you indicated, our position on the meaning of the expression "total available days" is set out in paragraph 11 of Interpretation Bulletin IT-63R5 which states, in part:
"The total number of days includes the first day during which the automobile is so made available and each day thereafter until such time as the employee is required by the employer to return the automobile and the control over its use to the employer or a person related to the employer. An automobile is available to the employee if it is used by the employee all day or for any part of the day or even if the automobile sits unused in the employee's garage or on the employee's driveway or parking spot."
On the basis of the above position, the total number of days in the year would need to be used in the situation you have presented to calculate the reasonable standby charge, even if the automobile use was restricted for part of the year.
We hope our comments are helpful.
Yours truly,
John Oulton, CA
for Director
Business and Partnerships Division
Income Tax Rulings Directorate
??
- 2 -
All rights reserved. Permission is granted to electronically copy and to print in hard copy for internal use only. No part of this information may be reproduced, modified, transmitted or redistributed in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, or stored in a retrieval system for any purpose other than noted above (including sales), without prior written permission of Canada Revenue Agency, Ottawa, Ontario K1A 0L5
© Her Majesty the Queen in Right of Canada, 2001
Tous droits réservés. Il est permis de copier sous forme électronique ou d'imprimer pour un usage interne seulement. Toutefois, il est interdit de reproduire, de modifier, de transmettre ou de redistributer de l'information, sous quelque forme ou par quelque moyen que ce soit, de facon électronique, méchanique, photocopies ou autre, ou par stockage dans des systèmes d'extraction ou pour tout usage autre que ceux susmentionnés (incluant pour fin commerciale), sans l'autorisation écrite préalable de l'Agence du revenu du Canada, Ottawa, Ontario K1A 0L5.
© Sa Majesté la Reine du Chef du Canada, 2001
Email this Content