Income Tax Severed Letters - 2008-04-25

Ruling

2008 Ruling 2008-0269031R3 - XXXXXXXXXX Corporate Reorganization

Principal Issues: Supplemental Ruling Request to 2007-023388 dated XXXXXXXXXX , 2007. Minor amendments to wording of several paragraphs.

Position: No effect on original rulings as issued.

2008 Ruling 2008-0271791R3 - XXXXXXXXXX Corporate Reorganization

Principal Issues: Supplemental Ruling Request to 2007-023388 dated XXXXXXXXXX , 2007. Minor amendments to wording of several paragraphs.

Position: No effect on original rulings as issued.

XXXXXXXXXX
2008-027179
XXXXXXXXXX , 2008

Ministerial Correspondence

3 April 2008 Ministerial Correspondence 2008-0266981M4 - Fitness Tax Credit

Unedited CRA Tags
118.03 Regulation 9400(2)

Principal Issues: Whether a five or six-week program for children's swimming lessons is eligible for the children's fitness tax credit.

Position: No.

Reasons: To be considered ongoing, the Regulations specify a minimum duration of eight weeks.

3 April 2008 Ministerial Correspondence 2008-0267561M4 - Fitness Tax Credit

Unedited CRA Tags
118.03 Regulation 9400(2)

Principal Issues: Whether a children's summer camp held for more than five days in total but less than five consecutive days is eligible for the children's fitness tax credit.

Position: No.

Reasons: To be considered ongoing, the Regulations specify a minimum duration of five or more consecutive days.

Technical Interpretation - External

17 April 2008 External T.I. 2007-0244311E5 - XXXXXXXXXX Political Party Fundraising Raffle

Unedited CRA Tags
248(31) 248(32)

Principal Issues:
Whether a receipt under the Income Tax Act can be issued to persons purchasing tickets in respect of a fundraising raffle held by a political party.

Position: No.

Reasons:
Is it arguable that the eligible amount of the monetary contribution is nil on the basis that the amount of the advantage in respect of the contribution is equal to the amount paid for the raffle ticket.

17 April 2008 External T.I. 2007-0249571E5 - Mortgage Investment Corporations and Foreclosures

Unedited CRA Tags
130.1(6)

Principal Issues:
Whether a corporation can develop or lease property under foreclosure circumstances and continue to qualify as a mortgage investment corporation.

Position: No.

Reasons:
The requirements under paragraph 130.1(6)(b) will not be met.

16 April 2008 External T.I. 2008-0270131E5 - Clergy Residence Deduction

Unedited CRA Tags
8(1)(c)

Principal Issues: Are the management level administrative personnel of XXXXXXXXXX , entitled to the clergy residence deduction under paragraph 8(1)(c)?

Position: It is a question of fact whether XXXXXXXXXX is a religious order or if its management level administrative personnel are engaged exclusively in full-time administrative service by appointment of a religious order or religious denomination.

Reasons: Not enough information to conclude that either the status test or the function test is met.

XXXXXXXXXX 2008-027013
L. Carruthers, CA
April 16, 2008

15 April 2008 External T.I. 2006-0216791E5 F - Frais de déplacement-Personnel VS Aff.

Unedited CRA Tags
6(1)a) 6(1)b) 81(3.1) 8(1)h)
travel of school trustee between home and administrative office where meetings were held was a personal expense, whose reimbursement was taxable

Principales Questions: Des sommes versées à un commissaire scolaire à titres de remboursement des frais de kilométrage entre son domicile et le centre administratif de la Commission scolaire peuvent-elles être exempté du calcul du revenu du commissaire pour l'année durant laquelle elles sont reçues.

Position Adoptée: Les frais de déplacement sont de nature personnelle.

Raisons: Position antérieure

10 April 2008 External T.I. 2007-0254531E5 - Home Office Expenses

Unedited CRA Tags
8(1)(i) 8(13)

Principal Issues: Whether a deduction for home office expenses should be available.

Position: Question of fact, but in this case probably.

Reasons: The law.

10 April 2008 External T.I. 2008-0265761E5 F - Avantage imposable - Programme écoAuto

Unedited CRA Tags
6(1)e) 6(2)
ecoAUTO program reduced the cost for standby benefit computation purposes

Principales Questions:
Doit-on tenir compte de la remise obtenue par l'employeur dans le calcul de l'avantage relatif au droit d'usage pour l'employé qui a à sa disposition le dit véhicule?

Position Adoptée: Si l'employeur loue le véhicule, non. Si l'employeur achète le véhicule, oui.

Raisons: Interprétation de la Loi - Positions antérieures

10 April 2008 External T.I. 2008-0272741E5 - motor

Unedited CRA Tags
6(1)(a) Regulation 7306 Regulation 7305.1

Principal Issues: Linespersons are on-call for five or six weeks per year and are required by the employer to take a company pick-up truck or a bucket truck home in order to respond to calls more expediently. The trucks are motor vehicles, not "automobiles" as defined under subsection 248(1) of the Act and are used to carry specialized equipment that are bulky in nature and used directly in the performance of the linespersons' employment duties, i.e., personal protection clothing, gear and equipment such as harnesses/cable-locating equipment etc.
1) Will a taxable benefit arise in the circumstances described?
2) What is an appropriate method to calculate the employment benefit for the personal use of the motor vehicles?

Position: 1)Yes. 2) The rate prescribed in s. 7305.1 of the Regulations.

Reasons: The rate in section 7305.1 of the Regulations reflects the economic benefit enjoyed by taxpayers that are prohibited from the personal use (other than driving between home and work) of motor vehicles that are specifically suited or designed to the employers' business or trade and are essential in a fundamental way for the performance of the employment duties. While this rate does not reflect the capital cost of owning a motor vehicle, it generally does reflect the operating cost. The rate, therefore, better reflects the benefit as a result of saving expenses that he or she would have otherwise had to incur for travel to and from work.t

Technical Interpretation - Internal

16 April 2008 Internal T.I. 2008-0274221I7 - Meaning of "year" in 74.5(2)

Unedited CRA Tags
74.5(2)

Principal Issues: Meaning of the phrase "was payable in respect of the particular year"

Position: The references to interest payable "in respect of the particular year" in paragraph 74.5(2)(b) and "in respect of each taxation year" in paragraph 74.5(2)(c) mean interest payable on the loan or indebtedness in respect of the particular calendar year.

Reasons: Subsection 74.5(2) of the Act provides an exemption from the attribution rules contained in subsections 74.1(1) and (2) and section 74.2. Those provisions are concerned with the attribution of income or losses between individuals for a "taxation year". Paragraph 249(1)(b) of the Act defines the taxation year of an individual to be the calendar year.

11 April 2008 Internal T.I. 2007-0239621I7 F - Crédit d'impôt pour pers. entièrement à charge

Unedited CRA Tags
118(1)b) 252(1)b)
taxpayer to whom a youth centre had placed a child and was no longer receiving compensation could potentially claim the credit

Principales Questions: Une personne ayant un enfant à sa charge, qui a été placé par un centre de jeunesse, peut-elle obtenir le crédit d'impôt équivalent pour personne entièrement à charge en vertu de l'alinéa 118(1)b) de la Loi de l'impôt sur le revenu ( la "Loi")?

Position Adoptée: Probablement, si toutes les conditions de l'alinéa 118(1)b) sont respectées. Question de faits.

Raisons: Si toutes les autres conditions de l'alinéa 118(1)b) de la Loi sont respectées, un particulier aurait droit au crédit d'impôt pour personne entièrement à charge, si elle a la charge complète d'un enfant et si elle en a la garde et la surveillance en droit ou en fait, selon la définition élargie du terme "enfant" prévue à l'alinéa 252(1)b) de la Loi.

7 April 2008 Internal T.I. 2008-0273391I7 - Taxpayer Relief Provisions

Unedited CRA Tags
220(3.1)

Principal Issues: Whether penalties and interest relating to the 1993 and 1994 taxation years may be waived under subsection 220(3.1) when the request for relief was not made until 2005

Position: No

Reasons: Minister has no authority to waive interest and penalties relating to taxation years that fall outside the 10-year time limit