Income Tax Severed Letters - 2026-01-21

Principal Issues: Dans une situation donnée, est-ce que l’ARC peut confirmer le traitement fiscal du profit réalisé par un contribuable au moment de la vente d’une quote-part de 50 % dans un bien à un tiers alors qu’il a acheté, moins de 365 jours avant, la quote-part de 50 % dans ce même bien de son coindivisaire? / In a given situation, can the CRA confirm the tax treatment of the profit by a taxpayer upon the sale of a share of a right of ownership representing 50% in a property to a third party, when the taxpayer had acquired a share of the right of ownership representing 50 % interest in that property from his/her co-owner less that 265 days prior?

Position: Dans la situation donnée, les règles sur les reventes précipitées énoncées aux paragraphes 12(12) à (14) L.I.R. ne s’appliquent pas à ce contribuable. Par conséquent, puisque ce contribuable ne détient qu’un seul bien et que la quote-part est un bien en immobilisation, il doit inclure dans la calcul de son revenu la totalité du profit réalisé lors de la vente de la quote-part du chalet au tiers à titre de gain en capital. / In the given situation, the rules on flipped property outlined in subsections 12(12) to 12(14) of the ITA do not apply to this taxpayer. Therefore since the taxpayer owns only one property and the share of the right of ownership in the property is considered a capital property, the taxpayer must include the full amount of the profit realized from the sale of the share of the right of ownership in the cottage to the third party as a capital gain in the calculation of his/her income.

Reasons: La Loi. / The law.

Principal Issues: Whether the payer has to report split income on T3 or T5 slips or to file a prescribed form.

Position: No legislative requirements.

Reasons: See below.

Principales Questions: Un particulier possède un CELIAPP. Il emménage avec une personne qui est propriétaire d’une maison et dont il devient le conjoint de fait. Il prévoit alors faire l’acquisition d’une quote-part indivise de 50% de la maison. (1) Le particulier sera-t-il considéré conclure une convention écrite en vue de faire l’acquisition d’une habitation admissible au sens de la définition de "retrait admissible" au paragraphe 146.6(1)? (2) En serait-t-il de même si la proportion était de 40%, 20% ou 1%? / An individual has a FHSA. He moves with a person who owned a house, and of whom he will become the common-law partner. He then planned to acquire a 50% undivided interest in the house. (1) Will the individual be considered to enter in an agreement in writing to acquire a qualifying home within the meaning of the definition of "qualifying withdrawal" under subsection 146.6(1)? (2) Would the same be true if the proportion were 40%, 20% or 1%?

Position Adoptée: (1) Oui, si toutes les autres conditions prévues à la définition de "retrait admissible" sont remplies. (2) Les proportions des quotes-parts des co-propriétaires n’ont pas nécessairement besoin d’être égales, mais c’est une question de fait de déterminer s’il y a une intention d’acquérir une habitation admissible aux fins de l’article 146.6. Cette condition pourrait ne pas être remplie lorsque la quote-part qui sera acquise est sans commune mesure avec l’utilisation qui sera faite de ce logement. / (1) Yes, if all the other conditions set out in the definition of "qualifying withdrawal" are met. (2) The proportions of the co-owners’ shares do not necessarily need to be equal, but it is a question of fact to determine whether there is an intention to acquire a qualifying home for the purposes of section 146.6. This requirement may not be met when the partial interest that will be acquired is not commensurate with the use that will be made of the housing unit.

Raisons: Voir la définition de "retrait admissible" au paragraphe 146.6(1). / See the definition of "qualifying withdrawal" under subsection 146.6(1).

Principales Questions: Un particulier possède un CELIAPP. La mère du particulier décide de lui céder par donation sa maison. Le particulier entend prendre possession de la maison et cette maison deviendra le lieu principal de résidence du particulier. Dans de telles circonstances, sera-t-il possible pour le particulier de remplir les conditions pour effectuer un "retrait admissible" aux fins de la définition du paragraphe 146.6(1) et pourra-t-on considérer que le particulier a conclu une convention écrite en vue d'acquérir une habitation admissible? / An individual has a FHSA. The individual's mother decides to give her home to the individual. The individual intends to take possession of the home and the home will become the individual's principal place of residence. In these particular circumstances, will the individual be able to meet the conditions for making a "qualifying withdrawal" for the purposes of the definition under subsection 146.6(1) and will the individual be considered to have entered into a written agreement to acquire a qualifying home?

Position Adoptée: Oui, le particulier devrait faire une acquisition par donation d'une habitation admissible et le retrait pourrait être un retrait admissible si par ailleurs toutes les autres conditions prévues à la définition de "retrait admissible" sont remplies. / Yes, the individual would make an acquisition by gift of a qualifying home and the withdrawal could be a qualifying withdrawal if all the other conditions provided in the definition of "qualifying withdrawal" are met.

Raisons: Définition de "retrait admissible" au paragraphe 146.6(1). / Definition of "qualifying withdrawal" under subsection 146.6(1).

Principales Questions: (1) Where the controlling individual of a trust governed by a registered plan is informed in advance that a property held by the trust will become a prohibited investment (PI), or a non-qualified investment (NQI) for the trust, would the CRA accept that a swap transaction be carried out before the investment becomes a PI or a NQI without adverse Part XI.01 tax consequence? (2) Where the controlling individual is informed by the issuer of the registered plan or otherwise that a property held by the trust will become a PI or a NQI and to the extent that the trust is unable to dispose of such property before that time, is the controlling individual eligible for the refund under subsection 207.04(4) and, is the exception in paragraph 207.01(1)(c) of the definition of “swap transaction” applicable?

Position Adoptée: (1) No. (2) No.

Raisons: (1) The exception provided for in paragraph 207.01(1)(c) of the definition of “swap transaction” is applicable only in respect of a transfer of a PI or a NQI from the registered plan for consideration, in circumstances where the controlling individual is entitled to a refund under subsection 207.04(4) on the transfer. (2) Subsection 207.01(6) deems the trust governed by a registered plan to have disposed and reacquired the property immediately before the time the property becomes a PI or a NQI for the trust. Therefore, the condition in subparagraph 207.04(b)(i) would be met and the controlling individual would not be entitled to the refund of the 50 % tax. Also, the exception provided for in paragraph 207.01(1)(c) of the definition of “swap transaction” would not be applicable, which would have the consequence that the tax payable in respect of an advantage provided for in subsection 207.05(1) would be payable. Subsection 207.06(2) gives the Minister the authority to cancel or waive all or part of the taxes imposed under subsection 207.04(1) or section 207.05 in appropriate circumstances, taking into account factors such as reasonable error, whether the transaction that gave rise to the tax also gave rise to another tax and the extent to which payments were made from the taxpayer’s registered plan.