Income Tax Severed Letters - 2020-08-12

Ruling

2020 Ruling 2020-0838951R3 F - Post-mortem Pipeline

Unedited CRA Tags
84(2), 84.1, 245(2)
Summary Under
Tax Topics - Income Tax Act - Section 84 - Subsection 84(2)
pipeline engaged in by beneficiaries following estate distribution and includes their previous shareholdings

Principales Questions: 1) Whether section 84.1 will apply to deem the heirs to have received a dividend upon the disposition of shares to the new company. 2) Whether section 84.1 will apply to reduce the PUC on the shares of the new company received as consideration for the disposition of the shares. 3) Whether subsection 84(2) applies to the proposed transactions. 4) Whether subsection 245(2) applies to the proposed transactions.

Position Adoptée: 1) No. Favorable ruling given. 2) No. Favorable ruling given. 3) No. Favorable ruling given. 4) No. Favorable ruling given.

Raisons: In accordance with the provisions of the Act and our previous positions.

Technical Interpretation - External

24 June 2020 External T.I. 2018-0747781E5 - Australian Self-managed Super Fund

Unedited CRA Tags
56(1)(a); 60(j); 248(1) definition of "superannuation or pension benefit"
Summary Under
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Superannuation or Pension Benefit
Australian “Self-managed Super Fund” was a pension plan
Summary Under
Tax Topics - Income Tax Act - Section 60 - Paragraph 60(j)
an Australian “Self-managed Super Fund” potentially could be transferred to an RRSP

Principal Issues: 1. What is the character of an Australian Self-managed Super Fund for Canadian income tax purposes? 2. What are the income tax implications to a Canadian resident for amounts received out of the arrangement?

Position: 1. The arrangement is a pension plan for purposes of the Act. 2. The payments are included in income under subparagraph 56(1)(a)(i) in the year they are received.

Reasons: 1. The plan meets the conditions accepted by the CRA and the courts to be considered a pension plan. 2. Subject to certain inapplicable exceptions, subparagraph 56(1)(a)(i) captures all amounts received from a pension plan.