22 May 1986 Income Tax Severed Letter 5-1515 - []

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

XXXX G. Thornley (613) 957-2130

May 22, 1986

Dear Sirs:

Re: XXXX

This is in reply to your letter of April 30, 1986, and further to your telephone conversation with R.J.L. Read, Director General requesting that we confirm the advice contained in our letter to you dated April 26, 1976. Specifically you ask that we confirm, as set out in the penultimate paragraph of that letter, that interest paid by a non-resident borrower to XXXX as agent for a non- resident lender is not taxable under Part 7.111 of the Income Tax Act (the "Act") because the payment is being made by one non-resident to another non-resident.

Our Comments

In our letter of April 26,XXXX it was stated, "Where any non-resident borrower becomes indebted to a non-resident lender and the interest is paid by the nor-resident borrower to the non-resident lender through acting as agent, it is our opinion that the interest is not taxable under Part XIII of the Income Tax Act as the payment is made by one non-resident to another non-resident'".

Providing XXXX fact acts as agent for the non-resident parties and the indebtedness is not secured by real property situated in Canada as described it paragraph XXXX of the Act, we confirm the above statement.

Yours truly,

ORIGINAL SIGNED BY Wm. R. McColm

for Director Reorganizations and Non-Resident Division Specialty Rulings Directorate Legislative XXXX