Income Tax Severed Letters - 2010-01-29

Ruling

2009 Ruling 2008-0276061R3 - Spin-off butterfly

Unedited CRA Tags
55(3)(b); 98(5)

Principal Issues: Whether the proposed butterfly reorganization meets the requirements of paragraph 55(3)(b).

Position: Yes

Reasons: Meets the requirements of the law.

2009 Ruling 2009-0343391R3 - Partnership Reorg-Personal Services Business

Unedited CRA Tags
125(7)

Principal Issues: Where a partner of a professional partnership creates a professional corporation through which professional services will be provided to the partnership, will the corporation be eligible for the small business deduction?

Position: Question of Fact. Generally yes, if certain conditions are met.

Reasons: Relevant legislation and consistent with other similar rulings.

2009 Ruling 2009-0346361R3 - Internal Reorganization - 55(3)(a) - Suppl. Ruling

Unedited CRA Tags
55(3)(a)

Principal Issues: Additional transactions following the spin-off of business assets from a corporation to another, within a related group.

Position: Favourable rulings provided.

Reasons: In compliance with the law and previous positions.

Ministerial Correspondence

18 January 2010 Ministerial Correspondence 2009-0342541M4 - Return of premium on CII Policy

Unedited CRA Tags
6(1)(a), 6(1)(f), 15(1)

Principal Issues: Whether the return of premium portion of the payment received on the cancellation of an individual CII policy, which is held by an employee or a shareholder of a corporation, would be taxable for income tax purposes.

Position: Question of fact.

Reasons: Without specific and complete details regarding the particular policy and the jurisdiction to which it pertains, it would not be possible to advise of the taxability of the ROP or other payment from the plan.

15 January 2010 Ministerial Correspondence 2009-0336831M4 F - CII pour places en garderie

Unedited CRA Tags
127(9)

Principales Questions: Qui a droit au crédit d'impôt à l'investissement (CII) pour des places en garderie dans les situations où:
a) la société ABC assume les coûts de développement et le coûts des immobilisations, mais mandate la société XYZ pour le développement des places en garderie;
b) la société XYZ, qui est mandatée pour développer des places en garderie pour les entreprises DEF, demeure la propriétaire des biens amortissables admissibles.

Position Adoptée: a) la société ABC, et non son mandataire, pourrait avoir droit au CII pour des places en garderie quant aux dépenses admissibles engagées pour la création de places en garderie.
b) la société XYZ n'est pas admissible au CII pour des places en garderie car elle ne crée pas des places en garderie pour les enfants de ses employés ou pour une combinaison de ceux-ci et d'autres enfants de la collectivité environnante. Question de faits l'admissibilité au CII pour DEF, dépedamment s'ils ont véritablement engagé une dépense admissible realtive à une garderie.

Raisons: Application des critères prévus au paragraphe 127(9) de la Loi de l'impôt sur le revenu.

Technical Interpretation - External

26 January 2010 External T.I. 2009-0344121E5 F - REER, déduction pour cotisations excédentaires

Unedited CRA Tags
146(8.2)
Summary Under
Tax Topics - Income Tax Act - Section 146 - Subsection 146(8.2) - Paragraph 146(8.2)(c)
a reference in Part I to a notice of assessment refers to a Part I notice of assessment
Words and Phrases
notice of assessment

Principales Questions: Le sous-alinéa 146(8.2)c)ii) fait référence à l'année où un avis de cotisation est envoyé. S'agit-il de l'avis de cotisation en vertu de la partie I ?

Position Adoptée: Oui

Raisons: Analyse contextuelle.

21 January 2010 External T.I. 2009-0349731E5 - Medical expenses - ultrasound tests

Unedited CRA Tags
118.2(2)

Principal Issues: Do the costs of ultrasound tests qualify as medical expenses for the medical expense tax credit where the individual has been referred by a doctor for such tests?

Position: Yes

Reasons: Legislation

20 January 2010 External T.I. 2009-0335451E5 - Motor Vehicle Allowances

Unedited CRA Tags
6(1)(b) and 8(1)(h.1)

Principal Issues: Is a particular location an employee's regular place of employment (RPE) and can expenses for travel between the employee's home and a location that is not the employee's RPE be deductible?

Position: Question of fact, but in this case the location does not appear to be an RPE. Deduction will depend on whether any allowance is included in the employee's income.

Reasons: The law and CRA's administrative position.

20 January 2010 External T.I. 2009-0345781E5 - Proposed amendment to section 40(3.1)

Unedited CRA Tags
40(3.1)

Principal Issues: What is the CRA's policy regarding comfort letters issued by the Department of Finance?

Position: See Q. 10 of 2009 CTF Roundtable. CRA's policy is to allow a taxpayer to file their return on the basis of proposed legislation.

Reasons: Policy

20 January 2010 External T.I. 2009-0349551E5 - medical expenses, travel, rent

Unedited CRA Tags
118.2(2)(e)

Principal Issues: Whether rent for accommodation close to a private school a child is attending qualifies as a medical expense?

Position: No

Reasons: The law.

19 January 2010 External T.I. 2009-0349421E5 F - Récompenses visées par règlement

Unedited CRA Tags
5(1); 6(1)a); 56(1)n); article 7700 du Règlement
Summary Under
Tax Topics - Income Tax Regulations - Regulation 7700
Quebec citizenship prizes are prescribed prizes

Principales Questions: Les Prix québécois de la citoyenneté décernés aux individus peuvent-ils être considérés à titre de récompenses visées par l'article 7700 du Règlement de l'impôt sur le revenu et ainsi être exclus du calcul du revenu de ceux et de celles qui les reçoivent?

Position Adoptée: Oui.

Raisons: Les Prix sont reconnus par le public et sont décernés pour des oeuvres méritoires réalisées dans le cadre de services au public, et ne sont pas considérés comme reçus en échange de services rendus ou à rendre.

8 January 2010 External T.I. 2009-0324631E5 - Test Wind Turbines

Unedited CRA Tags
1219(3)

Principal Issues: Whether each of XXXXXXXXXX proposed wind turbines will qualify as a test wind turbine within the meaning of subsection 1219(3) of the Regulations.

Position: Yes, provided that the facts and representations relating to the project remain as stated.

Reasons: Satisfies the criteria in the Regulations and a favourable opinion from NRCan.

6 January 2010 External T.I. 2009-0344981E5 - Employee Professional Development

Unedited CRA Tags
6(1)(a)

Principal Issues: Whether contributions made by an employer towards the cost of a one day in-service program that is intended to improve a participating employee's computer literacy skills will constitute a taxable employment benefit where the participants are allowed to keep a laptop computer at the end of the training session.

Position: Question of fact. However, the CRA has accepted that employer-paid training costs will not result in a taxable employment benefit to an employee where the primary beneficiary of the training is the employer.

Reasons: Don't have all the facts.