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.
| 24(1) |
900996 |
| |
A.Y. Ho |
| |
(613) 957-2095 |
19(1)
December 6, 1990
Dear Sirs:
Re: Deductibility of Costs of Distributing Mutual Fund Units
This is in reply to your letter of May 24, 1990 wherein you asked us to confirm that a taxable Canadian corporation would be entitled to deduct the costs incurred for distributing mutual fund units on a current basis. To illustrate your question, you have provided us with the following hypothetical facts:
A taxable Canadian corporation manages end markets the units of several Canadian mutual funds. In the course of distributing the units to the public, it incurs costs including selling commissions to registered dealers, legal end accounting fees, printing and translation costs, filing fees, listing fees, expenses associated with "road shows" and certain incentive bonuses to salesmen of registered dealers. The corporation earns income from management fees received from the mutual funds and redemption charges payable by holders of units on the redemption of their units.
As discussed in telephone conversation (Thompson 19(1) on November 29, 1990 we regret that the matter raised is currently under review with respect to the possible application of the General Anti-Avoidance Rules and we are unable to provide any opinion on the subject at the present time. Once the study is completed, a reply will be provided.
Yours truly,
for DirectorBusiness and General DivisionRuling DirectorateLegislative and Intergovernmental Affairs Branch
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© Her Majesty the Queen in Right of Canada, 1990
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© Sa Majesté la Reine du Chef du Canada, 1990
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