Principal Issues: Whether the CRA position described in paragraph 11 of IT-499R on the taxation of pension benefits can be extended to amounts paid out of a RCA in the context of a marriage breakdown such that such amounts would only be included in the income of the recipients of such amounts in the year of receipt.
Position: No.
Reasons: The taxation of pension benefits described in paragraph 11 of IT-499R is pursuant to paragraph 56(1)(a), which requires the inclusion of pension benefits in the income of a taxpayer in the year in which such benefits are received by the taxpayer. In contrast, amounts paid out of a RCA are taxed pursuant to paragraph 56(1)(x). Unlike paragraph 56(1)(a), the inclusion of such amounts in the income of a particular taxpayer under paragraph 56(1)(x) does not require that taxpayer to have received the amounts.
