Income Tax Severed Letters - 2019-03-27

Technical Interpretation - External

29 January 2019 External T.I. 2018-0780481E5 F - Tenir un établissement domestique autonome

Unedited CRA Tags
6(6)
Summary Under
Tax Topics - Income Tax Act - Section 6 - Subsection 6(6) - Paragraph 6(6)(a) - Subparagraph 6(6)(a)(i)
can qualify as self-contained domestic establishment if no ownership but expense responsibility
Words and Phrases
self-contained domestic establishment
Summary Under
Tax Topics - Income Tax Act - Section 118 - Subsection 118(1) - Paragraph 118(1)(b)
“self-contained domestic establishment” entails expense responsibility

Principales Questions: Que veut dire l’expression « tenait ailleurs et comme lieu principal de résidence, un établissement domestique autonome » au sous-alinéa 6(6)a)(i) ? / What does the phrase « maintained at another location a self-contained domestic establishment » in subparagraph 6(6)(a)(i) mean?

Position Adoptée: Question de fait. Le particulier doit être responsable de l’entretien de son établissement domestique autonome. / Question of fact. The individual must be responsible for the upkeep of its self-contained domestic establishment.

Raisons: Positions antérieures / Previous positions.

Conference

7 June 2017 CPTS Roundtable, 2017-0695131C6

Unedited CRA Tags
ss. 2(3); 111(5); 115(1)(b); "taxable Canadian property" - 248(1); "Canadian resource property" - 66(15); Reg. 1101(1); Class 7, 26 and 49; Article 13 of Canada-UK Tax Treaty; section 5 of Income Tax Conventions Interpretation Act
Summary Under
Tax Topics - Income Tax Act - Section 13 - Subsection 13(21) - Proceeds of Disposition
Q.1 - Daishowa extends beyond reforestation and reclamation obligations only on a case-by-case basis
Summary Under
Tax Topics - Income Tax Act - Section 66 - Subsection 66(15) - Canadian Resource Property - Paragraph (d)
Q.2 - a Canadian resource royalty interest requires a right to “take production”
Summary Under
Tax Topics - Treaties - Income Tax Conventions - Article 13
Q.3 - Canada-U.K. Treaty does not exempt shares deriving their value from Canadian oil and gas licences – even where the Canadian business is carried on “in” them
Summary Under
Tax Topics - Income Tax Act - Section 115 - Subsection 115(1) - Paragraph 115(1)(a) - Subparagraph 115(1)(a)(ii)
Q.4 - by analogy to mining, hydrocarbons may be similar properties
Summary Under
Tax Topics - Income Tax Regulations - Regulation 1101 - Subsection 1101(1)
Q.5 - normal course dispositions of oil and gas properties generally are not of a separate business
Summary Under
Tax Topics - Income Tax Act - Section 4 - Subsection 4(1)
Q.5 - application of Scales test to determining whether there is a separate business
Summary Under
Tax Topics - Income Tax Regulations - Schedules - Schedule II - Class 26
Q.7 - refinery catalysts are Class 26 property
Summary Under
Tax Topics - Income Tax Regulations - Schedules - Schedule II - Class 49
Q.8 - taxpayers generally have the documentary evidence on hand to allocate costs between pipelines and pipeline appendages

Principal Issues: Questions at CRA Round Table at 2017 Canadian Petroleum Tax Society Conference.

Position: See below.

Reasons: See below.

9 May 2018 CPA Roundtable Q. 11, 2018-0765271C6 - Application of 55(2)

Unedited CRA Tags
55(2)
Summary Under
Tax Topics - Income Tax Act - Section 55 - Subsection 55(2.1) - Paragraph 55(2.1)(b)
all manifestations of purpose and corroborating circumstances

Principal Issues: Application of purpose test in 55(2).

Position: Based on facts. See Ludco (2001 SCC 62).

Reasons: see below.

Technical Interpretation - Internal

21 February 2019 Internal T.I. 2019-0796791I7 - Mining Expenditure Review Table

Unedited CRA Tags
Definition of "Canadian exploration expense" in subsection 66.1(6)
Summary Under
Tax Topics - Income Tax Act - Section 66.1 - Subsection 66.1(6) - Canadian exploration expense - Paragraph (f)
categorization of pre-mining expenditures by ITA treatment
Summary Under
Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Start-Up and Close-Down Expenditures
Rio Tinto approach essentially applied to categorization of mine design studies

Principal Issues: What are the types of expenses that would normally qualify as exploration costs under paragraph (f) of the definition of "Canadian exploration expense" in subsection 66.1(6) in the context of a mining project?

Position: See attached table.

Reasons: See attached table.

21 February 2019 Internal T.I. 2019-0796792I7 F - Mining Expenditure Review Table

Unedited CRA Tags
Definition of "Canadian exploration expense" in subsection 66.1(6)

Principal Issues: What are the type of expenses that would normally qualify as "Canadian exploration expenses" under paragraph (f) of that defined term in subsection 66.1(6) in the context of a mining project?

Position: See attached table.

Reasons: See attached table.

21 December 2018 Internal T.I. 2018-0751891I7 - METC – fertility expenses

Unedited CRA Tags
118.2(2)(a), 118.2(2)(n), 118.2(2.2)

Principal Issues: Whether the cost of sperm and/or donor eggs are eligible medical expenses for the purpose of the medical expense tax credit (METC).

Position: Question of fact, but not likely.

Reasons: Costs incurred by an individual for fertility treatments are eligible expenses only if they are paid in respect of a patient who is the individual, their spouse or common-law partner, or, a dependant.