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: whether Millenium Prize awarded by National Gallery of Canada Foundation is a prescribed prize
Position: yes -
Reasons: prize will be recognized by the general public; is awarded for meritorious achievements in the arts; no indication the prize is provided as compensation for the services of the artists
Mr. Michael J. Adams, CMA
Head, Revenue & Budget Control
National Gallery of Canada 2001-007201
380 Sussex Drive Denise Dalphy, LL.B.
Post Office Box 427, Station A (613) 957-9231
Ottawa ON K1N 9N4
March 6, 2001
Dear Mr. Adams:
Re: Elusive Paradise - The Millenium Prize
We are writing in reply to your facsimile transmission of February 26, 2001 wherein you enquired whether the above-referenced prize is a "prescribed prize" for the purposes of subparagraph 56(1)(n)(i) of the Income Tax Act (the "Act") and section 7700 of the Income Tax Regulations (the "Regulations").
Our understanding of the facts is as follows:
The Millenium Prize explores the theme of Arcadia and questions our relationship to nature at the dawn of the new millennium. The participating artists were chosen by Diana Nemiroff, Curator of Modern Art, National Gallery of Canada after extensive research involving consultations with colleagues in Canada and abroad, visits to artists' studios and to many large international exhibitions. Ten artists were chosen, based on their exceptional quality of work.
An international committee comprising Lynn Gumpert, Director of the Grey Art Gallery in New York, Brazil's Ivo Mesquita, Director, Museum of Modern Art, Sao Paulo, Didier Ottinger, Curator of Modern Art at the Pompidou Centre in Paris, Montreal's Chantal Pontbriand, Editor of Parachute magazine, and presided by Pierre Theberge, Director of the National Gallery of Canada, will select one of the ten artists to receive the Millenium Prize of $50,000 from the National Gallery of Canada Foundation. The winner of the Millenium Prize will be announced on March 7, 2001.
The Millenium Prize joins the ranks of major international prizes such as the Turner Prize given by the Tate Gallery in London, England, and the Hugo Boss Prize awarded by the Solomon R. Guggenheim Museum in New York City.
There is no suggestion in any of the documentation that we have reviewed, including various Press Releases and Communiqués, that the Millenium Prize could reasonably be regarded as compensation for services rendered or to be rendered by any of the ten artists.
Written confirmation of the consequences inherent in particular transactions are given by this directorate only where the transactions are proposed and are the subject matter of an advance ruling request submitted in the manner set out in Information Circular 70-6R4. Where the particular transactions are partially completed or completed, the enquiry should be addressed to the relevant Tax Services Office. Notwithstanding the foregoing, we are providing the following comments.
From our review of the information which accompanied your request, it is our opinion that The Millenium Prize to be awarded by the National Gallery of Canada Foundation is a prize that is a prescribed prize for purposes of subparagraph 56(1)(n)(i) of the Act and section 7700 of the Regulations, and therefore would not be subject to income taxation in Canada.
The foregoing comments represent our general views with respect to the subject matter. As indicated in paragraph 22 of Information Circular 70-6R4, the above comments do not constitute an income tax ruling and accordingly are not binding on the Canada Customs and Revenue Agency. Our practice is to make this specific disclaimer in all instances in which we provide an opinion.
Yours truly,
Steve Tevlin
for Director
Business and Partnerships Division
Income Tax Rulings Directorate
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