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: Whether the XXXXXXXXXX qualifies as a "prescribed prize" pursuant to section 7700 of the Income Tax Regulations
Position: Question of fact, but likely not.
Reasons: Cannot be described as a prize that is recognized by the general public and that is awarded for meritorious achievement in the arts, the sciences or service to the public.
XXXXXXXXXX 2002-013450
J. Gibbons, CGA
May 30, 2002
Dear XXXXXXXXXX:
We are replying to your letter dated April 13, 2002, concerning the XXXXXXXXXX and whether it qualifies as a "prescribed prize" pursuant to section 7700 of the Income Tax Regulations. Our comments are of a general nature only since we cannot confirm the tax implications of particular transactions unless the transactions are proposed and are the subject matter of an advance ruling request submitted in the manner set out in Information Circular IC 70-6R4.
XXXXXXXXXX
A prescribed prize, as described in section 7700 of the Regulations, is any prize that is recognized by the general public and that is awarded for meritorious achievement in the arts, the sciences or service to the public, but does not include any amount that can reasonably be regarded as having been received as compensation for services rendered or to be rendered. A prize meeting all of the above criteria is not included in computing the income of the recipient under paragraph 56(1)(n) of the Income Tax Act. For example, a Nobel Prize given to a scientist or the Governor General's Literary Award given to a professional writer would qualify, as would many community service awards.
It is a question of fact whether the XXXXXXXXXX Award would qualify as a prescribed prize. However, based on the information provided, it is our view that it likely would not qualify as such and thus would be taxable under paragraph 56(1)(n) of the Act.
We trust that these comments will be of assistance.
Yours truly,
John Oulton, CA
for Director
Business and Partnerships Division
Income Tax Rulings Directorate
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