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.
R. Langevin 957-2138
Jan 23 1989
Dear Sirs:
Re: Single Purpose Corporations
This is in reply to your letter dated October 19, 1988, concerning the application of the position that the Department expressed in its replies to questions 20 and 14 of the 1980 and 1985 Round Table Questions respectively, to the situation that you have described.
The example that you have submitted is one in which an individual currently owns a Florida condominium in which he resides. Pursuant to subsection 85(1) of the Act he would transfer the property to a taxable Canadian corporation at its adjusted cost base taking in return shares and debt in consideration for the transferred property.
The Department's current position with respect to the situation outlined in the 1980 Round Table question 20 is that a shareholder benefit would not normally be assessed where all four of the conditions outlined therein are met, along with a fifth condition that the corporation acquired the property solely with funds provided personally by the shareholder. We advise that we would not be prepared to extend this administrative policy to the use that you have described which involves those results which may be obtained pursuant to a rollover under section 85 of the Act.
for Director Small Business and General Division Specialty Rulings Directorate Legislative and Intergovernmental Affairs Branch.
All rights reserved. Permission is granted to electronically copy and to print in hard copy for internal use only. No part of this information may be reproduced, modified, transmitted or redistributed in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, or stored in a retrieval system for any purpose other than noted above (including sales), without prior written permission of Canada Revenue Agency, Ottawa, Ontario K1A 0L5
© Her Majesty the Queen in Right of Canada, 1989
Tous droits réservés. Il est permis de copier sous forme électronique ou d'imprimer pour un usage interne seulement. Toutefois, il est interdit de reproduire, de modifier, de transmettre ou de redistributer de l'information, sous quelque forme ou par quelque moyen que ce soit, de facon électronique, méchanique, photocopies ou autre, ou par stockage dans des systèmes d'extraction ou pour tout usage autre que ceux susmentionnés (incluant pour fin commerciale), sans l'autorisation écrite préalable de l'Agence du revenu du Canada, Ottawa, Ontario K1A 0L5.
© Sa Majesté la Reine du Chef du Canada, 1989
Email this Content