18 July 1990 Administrative Letter 900916 F - Immigrant's Deductions

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.

July 18, 1990

Dear Sirs:

Re:  Immigrant's Deductions

This is in reply to your letter of May 21, 1990, and further to our letter of March 29, 1990, concerning the above noted subject.

You have asked for our opinion on whether the repayment of government loans received by some immigrants for travelling expenses incurred in immigrating to and settling in Canada are deductible by these individuals from employment income or, if not, whether they are deductible as moving expenses.

Concerning you enquiry regarding the deductibility of these amounts as moving expenses, we offer the following comments. Generally, in order for amounts expended to be eligible as moving expenses, they must relate to a move or moves within Canada and not relate to a move from outside of Canada to Canada (exceptions to this rule include certain students and deemed residents pursuant to section 250 of the Income Tax Act).  As this does not appear to apply to the situation outlined by you, we are of the view that the amounts expended cannot qualify as eligible moving expenses.  In this regard, we have enclosed IT-178R2 which provides further information on this subject.

We advised you in our letter of March 29, 1990, that it appeared to us the loans received by the individuals from the Government of Canada are in respect of personal or living expenses the deduction of which are expressly prohibited under the Income Tax Act.  In this regard, we also advise that "personal or living expenses", in this instance, would also include the expenses incurred by these individuals in moving into and settling in Canada.  We are not aware of any additional information which would change our view in this regard. 

We trust our comments have clarified the Department's views on this matter.

Yours truly,

for DirectorBusiness and General DivisionSpecialty Rulings DirectorateLegislative and Intergovernmental Affairs Branch