Income Tax Severed Letters - 2014-02-12

Ruling

2013 Ruling 2013-0475681R3 - Family holding butterfly transaction

CRA Tags
55(3)(b)
Summary Under
Tax Topics - Income Tax Act - Section 55 - Subsection 55(1) - Distribution
split-up b/f of holdco among siblings where siblings also hold prefs

Principal Issues: Whether the proposed reorganization qualifies for the paragraph 55(3)(b) exemption.

Position: Favourable rulings given.

Reasons: In compliance with the law and previous positions.

Technical Interpretation - External

28 January 2014 External T.I. 2014-0517601E5 - Qualified farm Property

CRA Tags
110.6(1), 110.6(1.3), 110.6(2)
Summary Under
Tax Topics - Income Tax Act - 101-110 - Section 110.6 - Subsection 110.6(1) - Qualified Farm or Fishing Property
qualifying use by father

Principal Issues: Whether certain land that is disposed of by the taxpayer would qualify as QFP?

Position: Question of fact.

Reasons: See response

27 January 2014 External T.I. 2013-0504191E5 F - RRSP, qualified investment

CRA Tags
ITR 4900(14), ITR 4900(6), ITR 5100(1), 207.01
Summary Under
Tax Topics - Income Tax Act - Section 207.01 - Subsection 207.01(1) - Advantage - Paragraph (a)
annuitant's free use of property of corporation held by RRSP is an advantage
Summary Under
Tax Topics - Income Tax Regulations - Regulation 4901 - Subsection 4901(2) - Specified Small Business Corporation
general discussion of SSBC definition

Principales Questions: 1) General questions regarding shares as a qualified investment for an RRSP trust.
2) For the application of subsection 207.05(1), is there an advantage in a situation where the annuitant of an RRSP trust who holds shares of a corporation uses an asset of the corporation for no consideration?

Position Adoptée: 1) None. 2) Yes.

Raisons: 1) General comments regarding qualified investments under subsections 4900(6) and 4900(14) of the Regulations.
2) Definition of advantage in subsection 207.01(1).

22 January 2014 External T.I. 2013-0488891E5 - T-slips and Incorrect Address

CRA Tags
ITR 209
Summary Under
Tax Topics - Income Tax Regulations - Regulation 209 - Subsection 209(2)
address known as incorrect

Principal Issues: Whether the issuer of an information slip, such as a T5, is required to send the slip to the recipient in situations where confirmation has been made that the recipient's address in their records is incorrect?

Position: No.

Reasons: The Income Tax Regulation 209(2) requires the information slip to be sent to the taxpayer's last known address. In situations where the address has been confirmed to be incorrect, and attempts to correct the address have not been successful, the information slip should not be sent. However the issuer must take reasonable care to correct their records.

15 January 2014 External T.I. 2013-0515651E5 F - Affiliated persons

CRA Tags
251.1(1)(d), 251.1(1)(b)(i), 248(1) "majority interest partner", 251.1(1)(e)
Summary Under
Tax Topics - Income Tax Act - Section 251.1 - Subsection 251.1(1) - Paragraph 251.1(1)(d)
control by a person is not control by a group of persons
Summary Under
Tax Topics - Income Tax Act - Section 251.1 - Subsection 251.1(1) - Paragraph 251.1(1)(e)
corporation is affiliated with partnership of which its controlling shareholder is a majority-interest partner

Principales Questions: A corporation is controlled by a single person. This person is a majority interest partner of a partnership. Whether the corporation and the partnership are affiliated with each other under paragraph 251.1(1)(d)?

Position Adoptée: No. However, the corporation and the partnership are affiliated with each other under paragraph 251.1(1)(e), based on the definition of majority interest partner which is broadened by the use of the concept of affiliated persons. If the partnership has de facto control over the corporation, the corporation and the partnership would also be affiliated with each other under subparagraph 251.1(1)(b)(i).

Raisons: Wording of the Act.

10 January 2014 External T.I. 2013-0506571E5 F - Subsections 15(2) and 15(2.6)

CRA Tags
15(2), 80.4(2), 15(2.6)
Summary Under
Tax Topics - Income Tax Act - Section 15 - Subsection 15(2.6)
monthly shareholder advances partially repaid with annual dividends

Principales Questions: Whether subsection 15(2.6) may apply in a situation where a loan balance stands each year, where all the conditions of subsection 15(2.6) are otherwise met?

Position Adoptée: Yes.

Raisons: The law.

3 January 2014 External T.I. 2013-0507541E5 F - Crowdfunding

CRA Tags
248(1), 9(1)
Summary Under
Tax Topics - General Concepts - Agency
whether a crowdfunding contribution is on-paid to a charity as agent for the contributor

Principales Questions: What is the tax treatment of amounts given and received through crowdfunding?

Position Adoptée: 1. Question of fact.

Raisons: 1. Previous positions.

30 December 2013 External T.I. 2013-0502641E5 - Transportation Allowance

CRA Tags
6(1)(b), 6(6)
Summary Under
Tax Topics - Income Tax Act - Section 6 - Subsection 6(6)
reasonable travel allowance

Principal Issues: What the CRA considers to be a reasonable transportation allowance for purposes of subparagraph 6(6)(b)(i) of the Act?

Position: Question of fact.

Reasons: It is the Directorate's view that an allowance that approximates the transportation expenses to be incurred by the employee would generally be considered reasonable for purposes of subparagraph 6(6)(b)(i) of the Act.

10 December 2013 External T.I. 2013-0481171E5 - Home Office Expenses

CRA Tags
8(13)(a)(ii), 8(1)(i)
Summary Under
Tax Topics - Income Tax Act - Section 8 - Subsection 8(13) - Paragraph 8(13)(a) - Subparagraph 8(13)(a)(ii)
"meetings" must be in person
Words and Phrases
meeting

Principal Issues: Whether the interpretation of the phrase "meeting customers" in subparagraph 8(13)(a)(ii) of the Act includes meetings by email, telephone, and skype?

Position: No.

Reasons: The ordinary meaning of the word "meet" is used when interpreting the phrase "meeting customers". "Meet" is defined as "encounter (a person or persons) by accident or design; come face to face with".