6 June 2001 External T.I. 2001-0075775 - EMPLOYER - PROVIDED PARKING

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 decision in Saskatchewan Telecommunications affects our policy on employer-provided parking.

Position: Our policy is not affected by decision.

Reasons: The decision is based on the court's finding of fact and judge's conclusion is consistent with our policy.

		2001-007577
XXXXXXXXXX 	Wayne Antle, CGA
(613) 957-2102
June 6, 2001

Dear XXXXXXXXXX:

Re: Employer-Provided Parking

This is further to your letter of March 14, 2001, concerning whether our policy on the taxation of employer-provided parking has been affected by the decision of the Tax Court of Canada in the case of Saskatchewan Telecommunications v. the Queen.

Written confirmation of the tax implications inherent in particular transactions is given by this Directorate only where the transactions are proposed and are the subject matter of an advance income tax ruling request. Where the particular transactions are completed, the inquiry should be addressed to the applicable Tax Services Office. However, we are prepared to provide the following general comments.

In the Saskatchewan Telecommunications case, Beaubier, T.C.C.J. found that the employer was the primary beneficiary of the benefits derived from the parking spaces made available to its employees because the employees were required to use their vehicles from time to time for business purposes. This business travel could be done more quickly and efficiently when the vehicles were located in the employer-provided parking spots. The court also found that the amounts paid to the employer for use of the parking spaces were sufficient to cover any incidental use of the spaces on evenings and weekends. The conclusion reached by Beaubier, T.C.C.J. is based on his finding of fact, and is consistent with our policy on employer-provided parking as outlined in the 2000-2001 Employers Guide to Taxable Benefits.

Generally, the fair market value of an employer-provided parking space, minus any amount paid by the employee for use of the parking spot, is a taxable employment benefit. However, there is no taxable employment benefit when the employer provides a free parking space for business reasons, and the employee is regularly required to use his or her vehicle to carry out the duties of employment. The determination of whether employees are regularly required to used their vehicles can only be made after reviewing all of the facts including the number of days in which the vehicles are required to be used for employment purposes throughout the year and the nature of the employment.

If you wish to discuss how the above guidelines apply to your particular situation, you may contact the Trust Accounts Division of the applicable Tax Services Office.

We trust that our comments will be of assistance.

Yours truly

John Oulton, CA
for Director
Business and Partnerships Division
Income Tax Rulings Directorate
Policy and Legislation Branch

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