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.
19(1) |
File No. 5-8176 |
|
A. Seidel |
|
(613) 957-8960 |
July 21, 1989
Dear Sir:
This is in reply to your letter dated May 31, 1989 with respect to the application of subparagraph 111(5)(a)(ii) of the Income Tax Act (the "Act") to trust companies.
The Loan and Trust Corporations Act defines a "trust corporation" as "a body corporate incorporated or operated for the purpose of offering its services to the public to act as trustee, bailee, agent, executor, administrator, receiver, liquidator, assignee, guardian of a minor's estate or committee of a mentally incompetent person's estate and for the purpose of receiving deposits from the public and of lending or investing such deposits". In our view for purposes of subparagraph 111(5)(a)(ii) of the Act the above mentioned services of a trust corporation constitute services rendered in the course of carrying on business.
In the situation where two trust corporations amalgamate, whether substantially all of the income of one predecessor corporation is derived from the rendering of services similar to that of the other predecessor corporation is a question of fact which can only be determined after a thorough examination of the specific facts. The hypothetical situation described in your letter lacks sufficient detail to allow such a determination.
While we hope our comments are of assistance to you, they do not constitute an advance income tax ruling and therefore are not binding on the Department in respect of a specific situation.
Yours truly,
for DirectorFinancial Industries DivisionRulings Directorate
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