25 March 2013 Internal T.I. 2013-0482291I7 - Home Buyers' Plan - Motor Home

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: 1. Whether a motor home is considered to be a qualifying home.
2. Whether a motor home is considered to be a principal place of residence.

Position: 1. No. 2. Unlikely.

Reasons: 1 & 2. See response.

March 25, 2013

Assessment Reviews and Ananthy Mahendran
Adjustments Division 905-721-5204
Individuals Returns Directorate
Attention: Pensions and Partnership
Projects Section
2013-048229

Home Buyers' Plan – Motor Home

This memo clarifies our position provided in our previous interpretation (E2011-042397) which addressed the eligibility of a motor home for purposes of the Registered Retirement Savings Plan ("RRSP") Home Buyers' Plan (the "HBP").

In order to participate in the HBP, an individual is required to satisfy several conditions set out under section 146.01 of the Income Tax Act (the "Act"). One of the conditions is that an amount withdrawn from an individual's RRSP at any particular time must be an "eligible amount". An eligible amount is either a "regular eligible amount" or a "supplemental eligible amount" of the individual, depending on the situation.

The definition of "regular eligible amount" in subsection 146.01(1) outlines several requirements that must each be met by an individual and his or her spouse, where applicable, in order for a withdrawal from the individual's RRSP to be eligible under the HBP. In accordance with paragraph (a) of the definition, the amount must be received pursuant to the individual's written request in a prescribed form in which the individual sets out the location of a "qualifying home" that the individual intends, not later than one year after its acquisition by the individual, to begin to use as a "principal place of residence".

In the factual situation set out in E2011-042397, there are two issues to be resolved in order to determine whether the RRSP withdrawal for a motor home will qualify as an eligible amount for purposes of the HBP. The first issue is whether the motor home is considered to be a qualifying home and the second issue is whether it is considered to be a principal place of residence.

A "qualifying home" is defined in subsection 146.01(1) of the Act to mean "a housing unit located in Canada". Accordingly, a qualifying home for purposes of the HBP must satisfy two requirements: (1) it must be a housing unit, and (2) it must also be located in Canada. The term "housing unit" is not defined in the Act; however, the term has been given a broad meaning in jurisprudence. Paragraph 3 of Interpretation Bulletin IT-120R6, Principal Residence, and Guide RC4135, Home Buyers' Plan, list types of properties that are considered "housing units" and these include a mobile home.

Neither "mobile home" nor "motor home" is defined in the Act. Since none of these highlighted words are defined in the Act, one must look to the ordinary meanings of these words as set out in dictionaries and other sources. The Concise Canadian Oxford Dictionary defines a mobile home as "a large transportable structure equipped with living accommodations, permanently parked, and used as a residence" and a motor home as "a large motor vehicle equipped as a self-contained home for camping or long trips." Since a motor home is powered by an engine and is not affixed to a land lot, it is considered more of a vehicle for long trips rather than a housing unit which is intended to be used as a principal place of residence for purposes of the HBP. Therefore, a motor home is not considered to be a mobile home and in turn a housing unit for purposes of the HBP.

Upon further review, it now appears that we inadvertently extended the position described in paragraph 3 of Interpretation Bulletin IT-120R6 for mobile home to motor home as an eligible housing unit for purposes of the HBP. Accordingly, the interpretive position provided in E2011-042397, as it pertains to whether a motor home is considered to be a mobile home, is being revoked effective immediately and we sincerely apologize for any confusion or misunderstanding that we may have caused.

With respect to the second issue, the term "principal place of residence" is not defined in the Act. However, as stated in Income Tax Technical News #31 ("ITTN 31R2"), an individual's "principal place of residence" is the place where the individual regularly, normally or customarily lives. In making this determination, several factors including the location of the individual's belongings, where the individual receives his or her mail, and where the individual's immediate family resides, are taken into consideration. Accordingly, it is our view that the above-noted determining factors make it unlikely that a motor home be considered to be a principal place of residence of an individual for purposes of the HBP.

We trust the above comments are of assistance.

Yours truly,

Sharmini Ratnasingham
for Director
Business and Employment Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch