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.
N.R. Mitchell (613) 957-2134
MAR 17 1988
Dear Sirs:
Re: Unpaid Remuneration; Subsection 78(4) of the Income Tax Act (the "Act")
This is in reply to your letter of February 23, 1988, in which you request the Department's interpretation of the words "unpaid on the day that is 180 days after the end of the taxation year in which the expense was incurred", as used in subsection 78(4) of the Act.
We recognize that, strictly speaking, an amount which is paid on the 180th day would be "unpaid" during some part of that day. However, we believe that the intent of the legislation was to allow the payor the full period of 180 days in which to pay the remuneration. Accordingly, it is our opinion that an amount which is paid before the end of the 180th day can be considered to be paid within the time limit stipulated by subsection 78(4) of the Act. Provided the payment otherwise qualified, such an amount may be treated as an expense incurred in the taxation year ending 180 days earlier.
We trust this information will be of assistance to you.
Yours truly,
for Director Small Business and General Division Specialty Rulings Directorate Legislative and Intergovernmental Affairs Branch
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© Her Majesty the Queen in Right of Canada, 1988
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© Sa Majesté la Reine du Chef du Canada, 1988
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