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 CCRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ADRC.
Principal Issues: With respect to clause 118(1)(b)(i)(B):
1. What is the CCRA's interpretation of "nor lived with their spouse or common-law partner"?
2. Is there any required time period that individuals need to live apart to meet the "any time in the year" requirements of subparagraph 118(1)(b)(i)?
Position TAKEN:
1. Whether or not an individual lived with their spouse or common-law partner is a question of fact.
2. No.
Reasons:
1. Question of fact.
2. Plain meaning of the phrase "at any time in the year".
XXXXXXXXXX 2002-012198
T. Young, CA
March 25, 2002
Dear XXXXXXXXXX:
Re: Amount for an Eligible Dependent (formerly the equivalent-to-spouse credit)
This is in reply to your letter of January 25, 2002, requesting our views on the Amount for an Eligible Dependent.
In your letter you referred to our technical interpretation letter 2001-0114147, which stated that there is no requirement in clause 118(1)(b)(i)(B) of the Income Tax Act (the "Act") that the "separation" must be by reason of a breakdown of their marriage (or common-law partnership). Further to that letter, you asked us the following questions:
1. What is the Canada Customs and Revenue Agency's interpretation of the phrase "nor lived with their spouse or common-law partner"? As an example, if an individual moved to another city to attend school or work, could the individual be considered not to be living with their spouse or common-law partner? Further, does it matter if the spouse or common-law partner attending school or work maintained a self-contained domestic establishment?
2. Is there a minimum time period necessary for individuals to live apart in order to fulfil the requirement "any time in the year" in subparagraph 118(1)(b)(i)?
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 submitted in the manner set out in Information Circular 70-6R4, Advance Income Tax Rulings, dated January 29, 2001. Also, it would be necessary to review all relevant documentation before a determination of the tax implications could be made. Therefore, we can only provide you with the following general comments.
As stated in technical interpretation letter 2001-0114147, the condition contained in clause 118(1)(b)(i)(B) is only that the taxpayer "neither supported nor lived with their spouse or common law-partner and who is not supported by that spouse or common-law partner". In our view, the separation does not necessarily have to be the result of a breakdown of the marriage or common-law partnership. Whether a person lived with another is a question of fact.
It should be noted that the conditions in clause 118(1)(b)(i)(B) must be read in their entirety. In our view, it is highly unlikely that at least one spouse or common-law partner in the examples you provided could ever be considered not to have lived with nor supported the other. Further, it is only in exceptional circumstances, such as the one raised in technical interpretation letter 2001-0114147, where a couple living separate and apart for a reason other than a breakdown in their marriage or common-law partnership could satisfy all of the requirements of clause 118(1)(b)(i)(B).
With respect to your second question, the Act does not specify a minimum length of time necessary to qualify for the credit.
We trust our comments will be of assistance to you.
Yours truly,
John Oulton, CA
for Director
Business and Partnerships Division
Income Tax Rulings Directorate
Policy and Legislation Branch
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