22 February 1989 Income Tax Severed Letter 7-3496 -  

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.

FEB 22 1989

TO   HALIFAX DISTRICT OFFICE
     Attention: Angus MacIssac
                Enquiries and Office Examinations

FROM Specialty Rulings Directorate K.B. Harding (613) 957-2129

SUBJECT:  Allowable Contributions to German    
          Pension Plans

This is in reply to your Round-Trip memorandum concerning the deductibility of voluntary contributions made to a German pension plan.

The Agreement on Social Security between Canada and the Federal Republic of Germany (the "Social Security Agreement") provides that certain Canadian nationals who reside outside the Federal Republic of Germany are entitled to voluntary coverage under German Pension insurance provided they meet the conditions set out in the Social Security Agreement. In our view, the Social Security Agreement does not require Canada to grant a deduction from income or a deduction from tax with respect to the voluntary contributions made into the German Pension insurance.

The Canadian Income Tax Act also does not provide for deduction from income in respect to amounts contributed by a Canadian resident to a foreign pension plan. Accordingly, we confirm that the taxpayers should not be permitted a deduction from income for Canadian taxation purposes for amounts contributed into the German pension plan.

We trust this is adequate for your purposes.

K.H.M.

for Director Reorganizations and Non-Resident Division Specialty Rulings Directorate Legislative and Intergovernmental Affairs Branch