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.
Principal Issues: Whether a transportation pass to travel on a seven to eight-passenger commuter van or a four-passenger commuter car will qualify for the credit.
Position: No.
Reasons: Does not meet the definition of public commuter transit services. The transportation is not by means of bus, ferry, subway, train or tram.
XXXXXXXXXX 2006-018780
October 31, 2006
Dear XXXXXXXXXX:
Re: The Public Transit Pass Tax Credit
We are writing in response to your correspondence of May 22, 2006, wherein you asked whether an individual who purchases a monthly transportation pass to travel on a seven to eight-passenger commuter van or a four-passenger commuter car, which are operated by the XXXXXXXXXX, would qualify for the credit.
On October 16, 2006, the Honourable James M. Flaherty, Minister of Finance, tabled a Notice of Ways and Means Motion in the House of Commons that includes legislation for the public transit pass tax credit. One of the requirements that must be met to qualify for the credit is that the transportation services meet the definition of "public commuter transit services" contained in draft 118.02(1) of the Income Tax Act. Public commuter transit services is defined to mean "services offered to the general public, ordinarily for a period of at least five days per week, of transporting individuals, from a place in Canada to another place in Canada, by means of bus, ferry, subway, train or tram, and in respect of which it can reasonably be expected that those individuals would return daily to the place of their departure".
In our view, a monthly pass for a seven to eight-passenger commuter van or a four-passenger commuter car would not qualify for the credit since the transportation would not be "by means of bus, ferry, subway, train or tram".
We trust that these comments will be of assistance.
Yours truly,
Randy Hewlett
for Director
Business and Partnerships Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch
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