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: Will a lump-sum withdrawal from the Singapore Central Provident Fund be excluded from income taxes in Canada?
Position: Provided that the amount is received as a pension benefit, yes.
Reasons: Article XVII of the Canada-Singapore Income Tax Convention provides that pensions and annuities arising in a Contracting State shall only be taxable in that State.
XXXXXXXXXX 2001-008107
M. P. Sarazin, C.A.
July 5, 2001
Dear XXXXXXXXXX:
Re: Singapore Central Provident Fund
This is in reply to your undated letter received April 23, 2001, requesting our views as to whether payments out of the Central Provident Fund in Singapore (the "Fund") would be subject to tax in Canada under the Income Tax Act (the "Act").
Under subparagraph 56(1)(a)(i) of the Act, a resident of Canada is required to include in his or her income any amount received in the year as, on account or in lieu of payment of, or in satisfaction of a superannuation or pension benefit. The determination of whether a specific payment from the Fund would constitute a superannuation or pension benefit for purposes of the Act is a question of fact.
If it is determined that payments from the Fund constitute superannuation or pension benefits for purposes of the Act, Article XVII of the Canada-Singapore Income Tax Convention (the "Treaty") would apply to the payments. Under Article XVII of the Treaty, pensions and annuities arising in a Contracting State shall be taxable only in that Contracting State. Consequently, the Treaty provides that a superannuation or pension payment paid out of Singapore will only be taxable in Singapore. For Canadian tax purposes, the Canadian resident recipient of the superannuation or pension payment from Singapore would have to include the payments in his or her income under subparagraph 56(1)(a)(i) of the Act and he or she would be entitled to an offsetting deduction under subparagraph 110(1)(f)(i) of the Act in respect of the superannuation and pension amounts included in income.
We trust these comments will be of assistance.
Yours truly,
Roberta Albert, C.A.
for Director
Financial Industries Division
Income Tax Rulings Directorate
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