Income Tax Severed Letters - 2016-05-25


2015 Ruling 2015-0619931R3 - Supplementary Ruling

Principal Issues: Whether certain amendments to the proposed transactions will impact the rulings granted in the original ruling letter 2014-053220?

Position: See below.

Reasons: See below.

Technical Interpretation - External

16 May 2016 External T.I. 2016-0647271E5 - Campgrounds and the Small Business Deduction

CRA Tags
125(1), 125(7)

Principal Issues: Income tax treatment of income earned by a corporation operating a campground. Can it claim a SBD?

Position: Question of fact but it is possible if sufficient services are provided.

Reasons: The law.

28 April 2016 External T.I. 2015-0594461E5 - Subsection 84.1(2.1)

CRA Tags
110.6, 40(1)(a)(iii)
intention to not claim exemption on future recognition of reserve is irrelevant

Principal Issues: Whether subsection 84.1(2.1) will apply to deem a taxpayer to have taken a capital gains exemption in the event a taxpayer claims a subparagraph 40(1)(a)(iii) reserve on the disposition of shares to which section 84.1 applies, even when the taxpayer does not and will not claim any capital gains exemption in respect of the disposition.

Position: Yes.

Reasons: See below.

5 April 2016 External T.I. 2013-0488681E5 - Certification of Mineral Resource

Principal Issues: Whether a graphite deposit is an industrial mineral contained in a non-bedded deposit (Certification by Minister of Natural Resources)

Position: Yes.

Reasons: Mineral deposit observes the requirements of definition of "mineral resources" in subpara. 248(1)(d)(i). See Certification by Minister of Natural Resources dated March 18, 2016.

17 February 2016 External T.I. 2015-0618211E5 - Subsections 88(1.1) and 88(1.2)

loss deduction postponed until year in which sub is dissolved

Principal Issues: Can the losses of a subsidiary be deducted by its parent corporation in the same year that the subsidiary gets dissolved?

Position: Yes.

Reasons: In accordance with subsections 88(1.1) and 88(1.2)

Technical Interpretation - Internal

15 March 2016 Internal T.I. 2014-0549701I7 - Obligation of Crown corporations to file a T106

CRA Tags
27(2), 149(1)(d), 150, 220(2.1)

Principal Issues: Whether a Crown corporation, federal or provincial, has to file a T106.

Position: Depends if it is acting as an agent of the Crown.

Reasons: Crown corporations acting as agents of the Crown, whether or not they are prescribed under Regulation 7100, are not required to file a T106 since Part XV of the Act does not apply to them.