Income Tax Severed Letters - 2002-11-22

Ruling

9 December 2002 Ruling 2002-0163953 - MEDICAL EXPENSES

Unedited CRA Tags
118.4(2)(a)

Principal Issues: The taxpayer requested a ruling on whether vitamin, mineral and health supplements that are prescribed by a medical doctor practicing complimentary medicine, and sold by a licensed pharmacist would qualify as a medical expense.

Position: No ruling provided. General comments only.

Reasons: The determination is a question of fact.

2002 Ruling 2001-0110663 - XXXXXXXXXX A NON-PROFIT ORGANIZATION

Unedited CRA Tags
149(1)(1)

Principal Issues: XXXXXXXXXX

Position: XXXXXXXXXX Yes. XXXXXXXXXX

Reasons: XXXXXXXXXX and previous interpretations have confirmed XXXXXXXXXX

Ministerial Correspondence

5 December 2002 Ministerial Correspondence 2002-0171974 F - CONGE A TRAITEMENT DIFFERE ET RETRAITE

Unedited CRA Tags
REG 6801

Principales Questions:
Un employé peut-il adhérer à un régime visé à l'alinéa 6801a) du Règlement et prendre sa retraite sans revenir à ses fonctions habituelles chez son employeur pour une période au moins égale à la durée de son congé?

Position Adoptée : Non, sauf dans des situations exceptionnelles.

Technical Interpretation - External

11 December 2002 External T.I. 2002-0167165 - MEDICAL EXPENSES

Unedited CRA Tags
118.2(2)

Principal Issues: Whether cost of "doctor prescribed food" for individual with celiac disease qualifies as medical expense.

Position: The cost of food is not a qualifying medical expense unless prescribed by a doctor and dispensed and recorded by a pharmacist.

Reasons: Paragraph 118.2(2)(n)

XXXXXXXXXX 2002-016716
Lena Holloway, C.A.
December 11, 2002

10 December 2002 External T.I. 2002-0172945 - MEDICAL EXPENSES-VITAMINS

Unedited CRA Tags
118.2(2)

Principal Issues: The taxpayer requested clarification as to whether the cost of vitamin B12 is a qualifying medical expense.

Position: Vitamin B12 must be prescribed by a medical practitioner and recorded by a pharmacist in a prescription record or prescribed by a medical practitioner for the treatment of pernicious anaemia.

Reasons: 118.2(2)(k) and (n)

9 December 2002 External T.I. 2002-0174285 - GIFT OF EASEMENT

Unedited CRA Tags
118.1(1) 118.1(6)

Principal Issues:
Can the donor gift an easement on ecological property without realizing a capital gain on the disposition?

Position: Yes.

Reasons: Legislation

9 December 2002 External T.I. 2002-0156215 - medical expenses

Unedited CRA Tags
118.4 118.4 118.2

Principal Issues: Whether reflexology treatments qualify as medical expenses

Position: No

Reasons: 118.4(2): Reflexologist does not qualify as a medical practitioner under relevant provincial legislation

6 December 2002 External T.I. 2002-0152085 F - PERSONNE A CHARGE TRANSFER D'UN MONTANT

Unedited CRA Tags
118.3(2) 118(1)d) 118(6)
credit transferee need not be the sole provider

Principales Questions:
Est-ce qu'un particulier a droit de réclamer d'une part, le montant pour personnes à charge âgées de 18 ans ou plus et ayant une déficience et d'autre part, le montant pour personnes handicapées transféré d'une personne à charge, tel que prévu respectivement à l'alinéa 118(1)d) et au paragraphe 118.3(2) de la Loi?

Position Adoptée:
Commentaires généraux sur la situation particulière.

5 December 2002 External T.I. 2002-0163135 F - Source Deductions - Nominal Partnership

Unedited CRA Tags
153(1) 200(1) Reg.
an individual could cover the payroll of the employees of him and another in agreed proportions as agent and principal, and handle all the source deductions, and prepare one information return
paymaster under payroll agency arrangements could fulfill the source deduction and T4 reporting requirements of the principal

Principal Issues: In a given situation, two individuals ("A" and "B"), each of them carrying on his or her own business, unite to group their expenses in a "nominal partnership" (which is not a partnership within the meaning of the Québec Civil Code). Salaries are paid to employees the services of which are used by both A and B. The question is to determine who is liable for source deductions with respect to the salaries paid to the employees.

Position: Where each of the individuals would personally pay a portion of the salaries (50%) to the employees without one acting as an agent for the other, each of the said individuals would be liable for source deductions on the portion of the salaries (50%) personally paid (i.e. requirement to deduct or withhold an amount and remit such amount to the Receiver General, and requirement to make an information return ("T4")).
Where B would pay all of the salaries to the employees (50 % personally and 50 % as agent or mandatary of A), B would be liable for source deductions on all of the salaries paid. A, as the principal or mandatary of B, would be liable for source deductions on the portion of the salaries (i.e. 50%) paid by B as agent or mandatary of A.

Reasons: Wording of the Act and case law.

5 December 2002 External T.I. 2002-0175695 - 116(4) Certificate

Unedited CRA Tags
116(4)

Principal Issues: Whether subsection 116(4) certificate issued to the purchaser in respect of property acquired from non-resident can be relied on in circumstances described?

Position: No.

Reasons: The requirements of paragraph 116(4)(a) not complied with.

5 December 2002 External T.I. 2002-0166375 - CAPITAL DIVIDEND ACCOUNT

Unedited CRA Tags
89(1)

Principal Issues:
Request that we reconsider the position in paragraph 6 of IT-430R3

Position: Same.

Reasons: Legislation

5 December 2002 External T.I. 2002-0176795 - RETIRING ALLOWANCE RELATED EMPLOYERS

Unedited CRA Tags
248(1) 60(j.1)

Principal Issues:
Whether previous employers (XXXXXXXXXX ) are related to the current employer (XXXXXXXXXX ) for purposes of a retiring allowance.

Position: Yes, same employer

Reasons: Treasury Board is the employer is all these departments

5 December 2002 External T.I. 2002-0172315 F - Contingent Right to Acquire Shares

Unedited CRA Tags
256(1.4) 251(5)(b)
ss. 251(5)(b) and 256(1.4) applicable where the 3 equal shareholders agree that they must purchase the shares of anyone committing fraud – but not if redemption requirement

Principal Issues: Whether 256(1.4) and 251(5)(b) apply in the 2 situations described in the letter.

Position: Situation 1 - Yes
Situation 2 - No

Reasons: Previous positions.

4 December 2002 External T.I. 2002-0147535 - INDEXED INSURANCE SEGREGATED FUND

Unedited CRA Tags
138.1(1)

Principal Issues:
Whether index-linked variable life insurance policies which are not segregated fund policies for OSFI purposes, e.g. pursuant to section 450 of the Insurance Companies Act, are also not segregated funds for the purposes of section 138.1(1) of the ITA

Position: Unable to conclude.

Reasons: Insufficient information and tests under both statutes are different.

29 November 2002 External T.I. 2002-0173355 - Test Wind Turbine - CRCE

Unedited CRA Tags
1219 66.1(6) Class 43.1

Principal Issues: Whether several wind turbines to be acquired and installed in a wind farm project would qualify as "test wind turbines" for the purposes of section 1219 of the Regulations?

Position: Yes, provided that the draft amendments to section 1219 of the Regulations would be enacted as proposed by Finance on July 26, 2002.

Reasons: By virtue of the existing paragraph 1219(3)(a) of the Regulations, only the first wind turbine in each wind farm project would qualify as "test wind turbine". However, pursuant to the proposed amendments to this paragraph dated July 26, 2002, more than one wind turbine in a wind farm project could qualify as "test wind turbines" provided other requirements are met.

20 November 2002 External T.I. 2002-0153635 - Exchange rights iss

Unedited CRA Tags
132(7)

Principal Issues: Whether a publicly traded unit trust would be considered to be maintained primarily for non-residents solely by reason of the issuance of exchange rights to non-residents

Position: question of fact

Reasons: 132(7) is broad enough to apply where any combination of the trust's purposes results in the trust being maintained primarily for the benefit of non-residents at a particular point in time

19 November 2002 External T.I. 2002-0162865 - Unification of Trusts

Unedited CRA Tags
104(2)

Principal Issues: Whether 104(2) applies to the scenario provided to unify a group of trusts created for the benefit of family members.

Position: Question of fact.

Reasons: The applicability ss. 104(2) of the Act and the relevance of the various facts will mainly be determined in light of its object which is to "prevent a beneficiary, group or class of beneficiaries from being allowed to split income by using various trusts for the same beneficiary, group or class of beneficiaries".

12 November 2002 External T.I. 2002-0129675 - Is a power of appointment subject to 70(5)

Unedited CRA Tags
70(5)

Principal Issues: How is a general power of appointment treated upon the death of the donee of the power?

Position: Although a power of appointment is generally not considered property, a power of appointment that can be exercised in favour of the donee would likely result in the donee holding an interest in a trust within the meaning of 248(25) such that 70(5) would apply to deem the donee to realize a disposition of such an interest upon his\her death.

Reasons: In 1976 CTF 744-762, Cullity distinguishes a power of appointment from property and concludes that a power of appointment is not itself subject to 70(5) because it is not property. In the English case, Melville et al. v IRC, the court held that a power of appointment was property within the extended meaning applicable to England's Inheritance Tax in that it confers on the donee a right that is capable of producing value. The law in question provided that the holder of a power of appointment over property other than settled property is to be treated as the beneficial owner of the property. Under 248(25)(b) of the ITA, an interest in a trust includes appointees under a power of appointment over the trust property; thus to the extent that the holder of a power of appointment can appoint the property to himself\herself, such a person has an interest in the trust, the value of which will be affected by the terms of the power of appointment.

Conference

11 October 2002 Roundtable, 2002-0156935 F - Vendor Non-Competition Payment

Unedited CRA Tags
248(1)

Principal Issues: Will CCRA apply the Manrell decision in similar case ?

Position: Yes.

Reasons: The TCC decision in Manrell effectively confirms CCRA's position stated at the 2000 CTF annual conference that non-competition payments will generally constitute proceeds of disposition of capital property, that being the right to compete with the purchaser.

11 October 2002 Roundtable, 2002-0156795 F - BILLET SUR RACHAT D'ACTION

Unedited CRA Tags
20(1)(c) 80(1)

Principales Questions:
1. Est-ce que l'intérêt sur un billet émis en contrepartie du rachat d'actions est déductible en vertu de 20(1)c) L.I.R.?
2. Est-ce que l'article 80 L.I.R. s'applique à un billet (émis en contrepartie du rachat d'actions) réglé pour une somme inférieure à son principal?

Position Adoptée:
1. Oui.
2. Oui, si les intérêts sur le billet sont déductibles dans le calcul du revenu.

11 October 2002 Roundtable, 2002-0156965 F - PARTIE 1.3 CHEQUES EN CIRCULATION

Unedited CRA Tags
181.2(3) 181(3)(b)

Principales Questions:
1. Est-ce que les chèques en circulation régis par le Code civil du Québec sont inclus dans le calcul du capital aux fins de la partie I.3 L.I.R.? Est-ce que l'Agence entend assouplir sa position actuelle pour simplifier l'application de son interprétation stricte de sa position pour avoir la même position qu'en common law?
2. Est-ce que des états financiers non vérifiés mais respectant les exigences des PCGR canadiens peuvent être préparés pour la déclaration de revenu canadienne que doit soumettre une société canadienne filiale d'une société américaine qui prépare ses états financiers selon les PCGR américains?

Position Adoptée:
1. (Selon nous, dans ce dossier, le droit applicable est le droit du Québec.) Selon le Code civil du Québec, la remise d'un chèque ne constitue pas un paiement de la dette, donc le montant des chèques en circulation peut être inclus si la dette réglée par ces chèques est une dette visée par la partie I.3. En common law, la remise d'un chèque en circulation opère paiement et le montant d'un tel chèque est inclus dans le calcul du capital comme prêt ou avance dans la mesure où leur montant est supérieur aux fonds déposés.
2. Il est acceptable de préparer des états financiers non consolidés et non vérifiés pour la filiale canadienne en autant que ces états financiers sont préparés selon les normes d'examen généralement reconnues aux chapitres 8100 et 8200 de Manuel de l'ICCA et qu'ils sont accompagnés d'un rapport indiquant que les PCGR ont été suivis.

11 October 2002 Roundtable, 2002-0156805 F - Refund of the RDTOH balance

Unedited CRA Tags
129(1.2) 248(5)

Principal Issues: Whether subsection 245(2) of the Act would apply in a particular situation.

Position: The Directorate practice is generally to rule on the application of subsection 245(2) only following a review of all the facts and circumstances surrounding transactions, in the context of an advance income tax ruling request. However, subsection 129(1.2) of the Act could apply in the particular situation. Based on paragraph 248(5)(b) and subsection 129(1.2), the stock dividend paid on a share of the capital stock of the corporation in the particular situation would be deemed not to be a taxable dividend if it turned out that the particular shareholder had acquired the share on which the stock dividend was paid or the newly issued shares received as the stock dividend in a transaction or as part of a series of transactions one of the main purposes of which was to enable the corporation to obtain a dividend refund.

Reasons: Wording of the Act.

11 October 2002 Roundtable, 2002-0156695 F - Gaar Surplus Stripping Post-Geransky

Unedited CRA Tags
245(2)

Principal Issues: Has CCRA's position to apply GAAR in dividend surplus arrangements changed as a result of the withdrawal of its appeal of the Dennis Geransky vs. H.M.Q. (2001 DTC 243) ?

Position: Yes, CCRA will not apply GAAR in cases identical to Geransky.

Reasons: CCRA agrees with the Court's decision in Geransky.

11 October 2002 Roundtable, 2002-0157005 F - Refundable Dividend Tax on Hand

Unedited CRA Tags
129(1) 129(3) 152(1.2)

Principal Issues: Whether the CCRA can confirm that it will not dispute the amounts added to the RDTOH account for a particular year when that particular year is statute-barred.

Position: No. The CCRA is of the opinion that, in the given situation, the payment of a taxable dividend in a subsequent year would not allow the corporation to obtain a dividend refund. The Minister would, in the subsequent year, determine an amount of dividend refund that would reflect the fact that, in a previous year, the corporation had earned business income and not realized a capital gain. The Minister would be entitled to make such a determination of the amount of the dividend refund in the particular year since the determination would be made within the "normal reassessment period" defined in subsection 152(3.1) I.T.A. in respect of the subsequent year. Furthermore, this operation would not result in a determination or redetermination, or in an assessment or reassessment of tax, that would be made after the "normal reassessment period" in respect of the previous year or any other year.

Reasons: Wording of the Act.

11 October 2002 Roundtable, 2002-0156825 F - PRODUCTION CINEMATOGRAPHIQUE QUEBECOISE

Unedited CRA Tags
12(1)(x)

Principales Questions: À quel moment le crédit d'impôt pour production cinématographique québécoise doit-il être inclus dans le revenu du contribuable?

Position Adoptée: Au moment où il est reçu.

11 October 2002 Roundtable, 2002-0156705 F - APFF CONGRES 2002

Unedited CRA Tags
149.1(1) 149.1(5)

Principales Questions: Calcul du contingent des versements lorsqu'une fondation ne réalise pas de revenu ou lorsqu'il y a une perte de valeur des biens. Impact des revenus sur le contingent des versements.

Position Adoptée: En absence de revenu, la fondation peut considérer l'application du paragraphe 149.1(5). La perte de valeur d'un bien n'affecte pas le contingent des versements. Les revenus n'affectent pas le contingent des versements.

11 October 2002 Roundtable, 2002-0157035 F - PRET PARTICIPATIF DEDUCTION DU PAIEMENT

Unedited CRA Tags
20(1)(c)

Principales Questions: Est-ce que suite à l'arrêt Shell Canada Limited 99 DTC 5669, l'Agence maintient sa position telle que citée dans les Nouvelles techniques No 16?

POSITION ADOPTÉE: Oui.

11 October 2002 Roundtable, 2002-0156885 F - BIEN DE LOCATION DETERMINE

Unedited CRA Tags
REG 1100(1.1) REG 1100(1.13) 16.1(1)

Principales Questions: Est-ce que le paragraphe 1100(1.1) s'applique aux conventions de location même si le bulletin d'interprétation IT-233R est annulé?

Position Adoptée: Oui.

11 October 2002 Roundtable, 2002-0156725 F - Subsection 256(9) of the ITA256(9)

Unedited CRA Tags
249(4) 87(2)

Principal Issues: Whether the positions set out in question 39 of the Revenue Canada Round Table at the 1990 Canadian Tax Foundation Conference and in the technical interpretation dated March 2, 1990, no. 5-9608, still represent the position of the CCRA.

Position: Yes.

Reasons: Wording of the Act and previous positions.

11 October 2002 Roundtable, 2002-0156895 F - EMPRUNT RACHAT D'ACTIONS ET DIVIDENDE

Unedited CRA Tags
20(1)(c)

Principales Questions: Quelle est la position de l'ADRC sur la déductibilité des intérêts sur un emprunt pour racheter des actions et pour verser des dividendes?

Position Adoptée:
En général, une société peut emprunter les montants nécessaires pour racheter des actions de son capital-actions jusqu'à concurrence du capital des actions rachetées et des bénéfices accumulés. Une société peut aussi emprunter un montant pour verser un dividende jusqu'à concurrence de ses bénéfices accumulés calculés sans utiliser la consolidation.
Le capital et les bénéfices accumulés doivent avoir été utilisés pour gagner un revenu et ne doivent pas avoir été utilisé pour acquérir des biens dont le revenu qui en est tiré est exempt d'impôt ou pour acquérir une police d'assurance-vie.

11 October 2002 Roundtable, 2002-0156735 F - Provincial Allocation

Unedited CRA Tags
Reg. 400

Principal Issues: Describe CCRA's administrative practice, if any, dealing with possible double taxation caused by changes to the allocation of taxable income among provinces and territories (Regulation 400)?

Position: Ontario, Alberta and CCRA formed the The Tri-party Review Allocation Committee (TRAC) to prevent and resolve potential disputes relating to taxable income allocation. Quebec attends the TRAC meetings as an observer.

Reasons: none provided

11 October 2002 Roundtable, 2002-0156925 F - Capital Dividend Account

Unedited CRA Tags
89(1) CDA 83(2) 184(2)

Principal Issues: Some taxpayers have mistakenly made an election under subsection 83(2) of the Act without considering the introduction of new paragraphs (c.1) and (c.2) of the definition of "capital dividend account" ("CDA") in subsection 89(1) of the Act. This resulted, in certain situations, in a Part III tax liability. Is the CCRA prepared to provide administrative relief in this regard?

Position: The CCRA agrees to provide administrative relief in regard to the application of Part III tax in certain situations. This administrative relief, however, is limited to situations in which an election under subsection 83(2) I.T.A. was made before February 1, 2002 and where the election is excessive due to an unawareness of the "new rules."

Reasons: Current position.

11 October 2002 Roundtable, 2002-0156775 - Purchaser non-competition agreement

Unedited CRA Tags
248(1)

Principal Issues: In the context of a sale of shares accompanied by an agreement not to compete, what is the tax treatment, for the payor, for the payment made to the person for agreeing not to compete (non-competition payment) ?

Position: The non-competition payment is considered, generally, part of the cost of acquiring the shares.

Reasons: Previous position.

11 October 2001 Roundtable, 2002-0157155 F - APFF CONGRES 2002

Unedited CRA Tags
7(1)

Principales Questions: Quelle source un contribuable doit-il utiliser pour établir le taux de change entre les devises américaine et canadienne?

Position Adoptée: Le taux de la banque du Canada ou un autre provenant d'une source acceptable.

Technical Interpretation - Internal

10 December 2002 Internal T.I. 2002-0175027 - SEGREGATED FUNDS CAPITAL GAINS AND CDA

Unedited CRA Tags
138(13) 89(1)

Principal Issues:
Whether the non-taxable portion of a capital gain from a segregated fund policy can be added to a corporate policyholder's capital dividend account.

Position: Yes.

Reasons:
Pursuant to subsection 138.1(3), capital gains or capital losses of a segregated fund trust are deemed to be capital gains or capital losses of the policyholder. Accordingly, where the policyholder is a corporation, it is our view that the non-taxable portion of a capital gain can be added to its capital dividend account.

5 December 2002 Internal T.I. 2002-0171847 F - RESIDENCE D'UNE FIDUCIE

Unedited CRA Tags
54 15(2) 15(2.1)
s. 15(2) applies to loan made by a corporation to a personal trust of which its shareholder is a beneficiary
principal residence designation is available in respect of a specified beneficiary even though the residence is rented by the trust to that beneficiary

Principales Questions:
1. Est-ce que l'actionnaire est tenu d'inclure dans son revenu un avantage en raison du prêt que la société a consenti à la fiducie?
2. Est-ce que la fiducie pourrait bénéficier de l'exemption pour résidence principale prévue à l'alinéa 40(2)b) de la Loi étant donné qu'elle loue la résidence à son bénéficiaire?

Position Adoptée:
1. Dans la présente situation, la fiducie serait rattachée à l'actionnaire et elle devrait inclure le montant du prêt dans son revenu, sous réserve de l'exception prévue au paragraphe 15(2.6) de la Loi. Les autres exceptions prévues aux paragraphes 15(2.2) à (2.7) de la Loi ne semblent pas s'appliquer à la présente situation. Le paragraphe 15(2) de la Loi ne s'appliquerait pas à l'actionnaire puisqu'il n'est pas la personne qui a obtenu le prêt ou contracté la dette auprès de la société donnée. Si le revenu résultant de l'application du paragraphe 15(2) de la Loi n'est pas payé ni payable au bénéficiaire selon les dispositions de l'acte de fiducie ou, dans le cas contraire, si le paragraphe 104(13.1) de la Loi s'applique pour réputer que ce revenu n'est pas payé ni payable au bénéficiaire, la fiducie n'obtiendrait aucune déduction pour ce montant de telle sorte que la fiducie serait imposée sur ce montant et non le bénéficiaire.
2. Si le bénéficiaire de la fiducie personnelle habite normalement la résidence, nous sommes d'avis que la fiducie personnelle peut désigner la résidence à titre de résidence principale en autant que toutes les autres conditions de la définition de " résidence principale " soient respectées, et ce, même si elle loue la résidence à ce bénéficiaire.

5 December 2002 Internal T.I. 2002-0155667 F - DEDUCTIBILITE DES INTERETS CAPITALISEES

Unedited CRA Tags
20(1)(c) 20(1)(d) 80
capitalized simple interest on loan to acquire common shares was deductible if reasonable expectation of dividends
debt forgiveness rules do not apply to forgiveness of compound interest
debt forgiveness rules do not apply to forgiveness of compound interest

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.

Principale Question: Les intérêts payables et capitalisés sur un prêt contracté pour acquérir des actions participantes sont-ils déductibles en vertu de l'alinéa 20(1)c) de la Loi de l'impôt sur le revenu?

4 December 2002 Internal T.I. 2002-0168757 - PAY EQUITY LUMP SUM PAYMENT

Unedited CRA Tags
70(1) 70(2) 110.2(2)

Principal Issues: Whether a pay equity payment will be a "qualifying amount" for purposes of subsection 110.2(2) of the Act.

Position: Question of fact.

Reasons: Subsection 110.2(2) of the Act will apply to all payments that satisfy all of the requirements of the definition of "qualifying amount".

4 December 2002 Internal T.I. 2002-0138067 F - REMPLACEMENT D'UNE CREANCE PAR UNE AUTRE

Unedited CRA Tags
18(9.1)
financing the repayment of a debt obligation with the proceeds of a borrowing from a different creditor does not constitute a debt substitution

Principales Questions:
Que signifie le remplacement d'une créance par une autre au paragraphe 18(9.1) de la Loi?

Position Adoptée:
Pour qu'il y ait un tel remplacement aux fins du paragraphe 18(9.1) de la Loi, il doit y avoir entre le créancier et le débiteur un remplacement de l'obligation originale par une autre obligation.

28 November 2002 Internal T.I. 2002-0153837 F - SOMMES IMPAYEES

Unedited CRA Tags
78(1)a) 18(1)a) 12(1)b)
IT-109R, para. 12(a) not applied where there was an asymmetry between the deduction/ net inclusion amounts reported by the debtor and creditor

Principale Question:

Compte tenu des commentaires exprimés dans l'affaire Redclay Holdings Ltd sur la position énoncée au paragraphe 12 a) du IT-109R, les dispositions de l'alinéa 78(1)a) de la Loi devraient-elles s'appliquer au débiteur lorsque, par ailleurs, le débiteur et un créancier, ayant un lien de dépendance, comptabilisent leur revenu sur la base de la comptabilité d'exercice?

Position Adoptée:
Non.

27 November 2002 Internal T.I. 2002-0140507 - FOREIGN EXCHANGE LOSS

Unedited CRA Tags
20(1)(f) 39(2)

Principal Issues:
Can foreign exchange losses be deducted pursuant to paragraph 20(1)(f) of the Act?

Position: No.

Reasons:
Foreign exchange losses incurred on the settlement of debt denominated in a foreign currency should not be deductible under paragraph 20(1)(f).

27 November 2002 Internal T.I. 2002-0140517 - FOREIGN EXCHANGE LOSS

Unedited CRA Tags
20(1)(f) 39(2)

Principal Issues:
Can foreign exchange losses be deducted pursuant to paragraph 20(1)(f) of the Act?

Position: No.

Reasons:
Foreign exchange losses incurred on the settlement of debt denominated in a foreign currency should not be deductible under paragraph 20(1)(f).

25 November 2002 Internal T.I. 2002-0171137 - STOCK OPTION FMV AND TRADING RESTRICTION

Unedited CRA Tags
7(1)

Principal Issues: Should FMV of shares be discounted for purposes of subsection 7(1)?

Position: Question of Fact

Reasons: This is a question of valuation outside of IT Rulings' expertise and should be referred to the valuations unit.