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:
Does the word "rights" in the phrase "settlement of rights arising out of" in paragraph 146(16)(b) include support rights or is its meaning restricted to property rights?
Position:
Word encompasses all rights in law, including support rights.
Reasons:
There is nothing in the Act to restrict the scope of the meaning of the word as used in paragraph 146(16)(b).
XXXXXXXXXX 2002-014422
G. Kauppinen
August 2, 2002
Dear XXXXXXXXXX:
Re: Paragraph 146(16)(b) of the Income Tax Act (the "Act")
This is in reply to your letter dated April 15, 2002 regarding the scope of the word "rights" contained in the phrase "settlement of rights arising out of, or on the breakdown of, their marriage or common law partnership" in paragraph 146(16)(b) of the Act. Specifically, you ask if the word "rights", in the context of paragraph 146(16)(b) of the Act, includes support rights or whether the word is restricted to property rights.
Opinions concerning proposed transactions involving specific taxpayers will only be provided in response to a request for an advance income tax ruling. For more information concerning advance income tax rulings, please refer to Information Circular 70-6R5 dated May 17, 2002, issued by the Canada Customs and Revenue Agency. Copies of information circulars and interpretation bulletins are available from your local tax services office or on the Internet at the following site - http://www.ccra-adrc.gc.ca/formspubs/menu-e.html. However, we can provide you with the following general comments.
In our view, there is nothing in the Act that restricts the meaning of the word "rights" as it is used in paragraph 146(16)(b) of the Act. Consequently, the word will encompass both support and property rights.
We trust our comments will be of assistance to you.
Yours truly,
Mickey Sarazin, CA
for Director
Financial Industries Division
Income Tax Rulings Directorate
Policy and Legislation Branch
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