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: Is the taxpayer exempt under paragraph 149(1)(d) of the Act?
Position: On XXXXXXXXXX , all of the shares of the taxpayer were owned by Her Majesty in right of Canada.
Reasons: Facts and Legislation. Claude Englehart of Technical Applications agreed that Rulings would respond directly to the corporation.
paragraph 149(1)(d) dependent upon the taxpayer being controlled in fact by Her Majesty in right of Canada or a province.
XXXXXXXXXX 2003-004494
R. Maley
January 15, 2004
Dear XXXXXXXXXX:
Re: XXXXXXXXXX
This is in reply to your letter of October 21, 2003 requesting our confirmation that a particular corporation, XXXXXXXXXX is a tax exempt corporation commencing XXXXXXXXXX. You have referred us to XXXXXXXXXX in this regard ("the orders").
Proposed amendments to subsection 149(1.3) of the Income Tax Act ("the Act") would, for taxation years beginning after December 20, 2002, make indirect or "de facto" control of the corporation relevant for purposes of paragraph 149(1)(d) of the Act. Having regard to those proposals, it is our view that XXXXXXXXXX would be exempt from tax on its taxable income under Part I of the Act pursuant to paragraph 149(1)(d) for any period in respect of which the following conditions are satisfied. First, all of XXXXXXXXXX shares or capital are owned by one or more persons, each of which is Her Majesty in right of Canada or Her Majesty in right of a province. Second, XXXXXXXXXX is not a prescribed federal Crown corporation ( a "PFCC") for purposes of subsection 27(2) of the Act. Third, no person other than Her Majesty in right of Canada or of a province controls XXXXXXXXXX directly or indirectly in any manner whatever.
We have reviewed the orders and conclude that Her Majesty in right of Canada, on XXXXXXXXXX, became the owner of all of the shares of XXXXXXXXXX. We also confirm that XXXXXXXXXX is not a PFCC and was not a PFCC on XXXXXXXXXX.
The application of paragraph 149(1)(d) of the Act to a person for a particular period is dependent upon the person satisfying all requirements of that paragraph for the particular period. This determination cannot be made in advance of or during the particular period but only after the end of the period. Should you have any questions or concerns pertaining to the application of paragraph 149(1)(d) to XXXXXXXXXX at a particular time, you should submit all relevant facts and documentation to the appropriate Tax Services Office for their views.
Yours truly,
F. Lee Workman
Manager
Financial Institutions
Financial Industries Division
Income Tax Rulings Directorate
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