Income Tax Severed Letters - 2016-12-07

Technical Interpretation - External

18 October 2016 External T.I. 2015-0608051E5 F - Emigration of a trust

Unedited CRA Tags
128.1(4)(a)(i); 128.1(4)(b); 220(4.5); 220(4.51); 220(4.54); 248(1) "balance-due date"
Summary Under
Tax Topics - Income Tax Act - Section 220 - Subsection 220(4.5)
emigrating trust can elect to defer payment of the exit tax
Summary Under
Tax Topics - Income Tax Act - Section 2 - Subsection 2(1)
Fundy Settlement test may differ from residence of trustees

Principal Issues: 1.Whether a trust that ceases to be resident in Canada can make an election under subsection 220(4.5)? 2. Whether the Minister can, pursuant to subsection 220(4.54), extend the time for making such election and for furnishing and accepting security under that subsection?

Position: 1. Yes. 2. Yes, if the Minister considers it just and equitable to do so.

Reasons: Application of the Act.

21 September 2016 External T.I. 2016-0639401E5 - Temporary living expenses and travel costs

Unedited CRA Tags
6(1)(a), 6(23), 62

Principal Issues: Where an individual has moved to start new employment and there is a long transition period during which the employee has accommodations at the new work location and maintains the old residence, is the reimbursement of the following expenses a taxable benefit: (1) employee's living expenses while waiting to occupy a new, permanent home; (2) the employee's expenses for travel between the old residence and the new work location; and (3) the employee's family members' travel expenses between the old residence and the new work location?

Position: Question of fact. General comments provided.

Reasons: Question of fact. General comments provided.

21 September 2016 External T.I. 2016-0640201E5 - Taxable benefits - travel employer-paid trip

Unedited CRA Tags
6(1)(a)

Principal Issues: What is the relevance of the employee’s job description and senior management authorization in determining whether an employer-paid trip is a taxable benefit?

Position: Question of fact.

Reasons: See response.

22 August 2016 External T.I. 2016-0634351E5 - Business use of cellphone required for work

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

Principal Issues: Whether the costs of a basic cellular service plan is deductible from an employee's employment income under the Act.

Position: Question of fact.

Reasons: 2015-0603631I7

Technical Interpretation - Internal

17 August 2016 Internal T.I. 2016-0639251I7 - Capital Dividend Account and 149(1)(n)

Unedited CRA Tags
149(1)(n), 83(2), 89(1), 89(1.2)
Summary Under
Tax Topics - Income Tax Act - Section 89 - Subsection 89(1) - Capital Dividend Account - Paragraph (a)
exempt low-rental housing corp can use a CDA
Summary Under
Tax Topics - Income Tax Act - Section 89 - Subsection 89(1.2)
deemed 149(10) gain does not add to CDA before it disapppears under 89(1.2)
Summary Under
Tax Topics - Income Tax Act - Section 149 - Subsection 149(1) - Paragraph 149(1)(n)
can have a CDA while exempt

Principal Issues: Whether 149(1)(n) entity can have and use a capital dividend account.

Position: Yes, provided conditions are met.

Reasons: See below.

19 July 2016 Internal T.I. 2015-0603631I7 - Employment expense-deductibility cell service plan

Unedited CRA Tags
6(1)(a), 8(1), 8(1)(i)(iii)

Principal Issues: Whether the cost of a basic cellular service plan is deductible from an employee’s employment income under the Act.

Position: It is a question of fact.

Reasons: See response.