Income Tax Severed Letters - 2019-03-13

Ministerial Correspondence

12 February 2019 Ministerial Correspondence 2018-0741061M4 F - Revenu d’un Indien

Summary Under
Tax Topics - Other Legislation/Constitution - Federal - Indian Act - Section 87
pension income generated from off-reserve employment and received on reserve not exempted

Principales Questions: Le contribuable demande que son revenu de pension provenant d’emploi hors réserve, mais qui selon lui est situé sur le territoire XXXXXXXXXX, soit exempté en vertu de XXXXXXXXXX. / The taxpayer asks that his pension income from an employment situated off-reserve, but in his opinion is located in the territory XXXXXXXXXX, be exempted under XXXXXXXXXX.

Position Adoptée: Le revenu de pension du contribuable est imposable. / Taxpayer’s pension income is taxable.

Raisons: Rien n’indique que le contribuable a gagné son revenu de pension dans une réserve. /There is no indication that the taxpayer earned his pension income on a reserve.

Technical Interpretation - External

19 February 2019 External T.I. 2016-0643141E5 - Private health services plans

Unedited CRA Tags
6(1)(a); 248(1)

Principal Issues: Does a plan that provides coverage for expenses such as fitness centre memberships, personal trainers, weight management programs, smoking cessation programs, nutrition counselling, etc. qualify as a PHSP?

Position: Question of fact.

Reasons: It is a question of fact whether a plan satisfies the conditions to be a PHSP. The term medical expense is not defined for purposes of PHSP.

11 February 2019 External T.I. 2018-0738561E5 - Employer contributions

Unedited CRA Tags
144
Summary Under
Tax Topics - Income Tax Act - Section 144 - Subsection 144(1) - Employee Profit Sharing Plan
requirement for employer profit contributions to an EPSP cannot be waived

Principal Issues: 1. Can an EPSP be amended to remove the employer’s obligation to make contributions? 2. If not, can this requirement be waived?

Position: 1. No. 2. No.

Reasons: 1. Paragraph (a) of the EPSP definition in subsection 144(1) provides that an employer is required to make contributions by reference to profits, or “out of profits” if an election under subsection 144(10) is filed, under the plan. 2. There is no legislative basis to waive this requirement.

31 January 2019 External T.I. 2017-0695931E5 - Representation or other special allowances

Unedited CRA Tags
6(1)(b)(iii); 250(1)(d); Reg. 3400

Principal Issues: Whether allowances provided to employees are representation or special allowances for the purposes of subparagraph 6(1)(b)(iii) of the Income Tax Act and excluded from income under that subparagraph.

Position: Likely yes.

Reasons: See response.

Technical Interpretation - Internal

17 January 2019 Internal T.I. 2018-0781041I7 - Non-resident trust ceasing to be deemed resident

Unedited CRA Tags
94(2)(g), 94(2)(t), 94(3)(a), 94(4)(e), 94(5)
Summary Under
Tax Topics - Income Tax Act - Section 94 - Subsection 94(2) - Paragraph 94(2)(t)
s. 94(2)(t) sale of Canadian shares effects an immediate change in trust residency
Summary Under
Tax Topics - Income Tax Act - Section 94 - Subsection 94(5)
change of residency occurs with s. 94(2)(t) sale

Principal Issues: Is our position in 2013-0509111E5 valid?

Position: The result is correct; however, there is an inaccurate statement.

Reasons: See below.