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: meaning of "immediately prior to appointment or employment" found in 250(1)(c)
Position: refers to hiring rather than actual commencement of employment
Reasons: previous position taken in files 9507485 and 2000-001328
XXXXXXXXXX D. Yuen
2002-011819
Attention: XXXXXXXXXX
May 24, 2002
Dear XXXXXXXXXX:
Re: Deemed residency
We are writing in response to your letter dated January 15, 2002, wherein you requested a technical interpretation in respect of the situation described below. Unless otherwise stated, all references to a statute herein are to the Income Tax Act (Canada), R.S.C. 1985 (5th supp.) c. 1, as amended.
Situation
A person resident in Canada sees an advertisement for a position at a Canadian diplomatic post in a foreign country. The person applies for the position and is successful in the competition. The employment is to commence on November 1. On October 25, the person leaves Canada. You have asked us to assume that the person has ceased to be resident in Canada at that time. On November 1, the person commences his or her employment as an officer or servant of Canada. The person did not receive a representation allowance as referred to in paragraph 250(1)(c).
Your Question
In this situation, would paragraph 250(1)(c) apply since the person was not resident in Canada immediately prior to appointment or employment by Canada?
It is our position that the phrase "immediately prior to appointment or employment by Canada" refers to the time when the person is hired and not when the person actually commences employment. In this situation the person is resident in Canada immediately before hiring (that is, when the person's employment is confirmed by letter or contract) so the provisions of paragraph 250(1)(c) will apply to deem the person to be resident in Canada throughout the taxation year.
These comments are provided in accordance with the guidelines set out in paragraph 22 of Information Circular IC 70-6R4 dated January 29, 2001, issued by the Canada Customs and Revenue Agency (the CCRA) and are not considered binding on the CCRA.
Yours truly,
for Director
International and Trusts Division
Income Tax Rulings Directorate
Policy and Legislation Branch
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