18 January 1990 Ruling 58923 F - Employer Paid Moving Expenses

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.

Dear sirs:

Re:  Employer Paid Moving Expenses

We are responding to your letter of October 26, 1989, concerning the reimbursement or payment of an employee's moving expenses by an employer.

Paragraph 35 of IT-470R  "Employees' Fringe Benefits" states that we do not consider the payment or reimbursement of an employee's moving expenses by his employer to be at taxable benefit where the employee is transferred to or accepts employment at a new work location and, by reason thereof is required to move to that new location.  In paragraph 36 of the same bulletin we extend this treatment to the reimbursement or payment of moving expenses out of a remote location at the termination of employment.  You point out that the term "remote" should be deleted as in your view, it adds nothing material to the paragraph.

We respectfully disagree.  Except for moves out of a remote location, it is our view that a taxable benefit is conferred on an employee where an employer pays or reimburses a former employee for moving expenses incurred in returning to the location of his former home at the termination of his employment.

While it is true that he remoteness of a particular place must be evaluated in relation to some other place, it is our view that he use of the word "remote" without a term of reference takes on the meaning of "isolated" or remote in relation to all other places. While these guideline may be useful in most cases, other factors may also effect the determination of whether or not any particular place can be considered "remote" in this context.  In our view, however, Regina is not a remote place for this purpose.

If you have a particular situation in which it is not clear whether or not a particular place is considered remote, you may wish to forward all the relevant details to the local district taxation office in order to obtain their view.

We trust our comments will be of assistance to you.

Yours truly,

for DirectorBusiness and General DivisionSpecialty Rulings DirectorateLegislative and Intergovernmental Affairs Branch