18 October 1990 Administrative Letter 901846 F - Employee Benefit of Counselling Services

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.

October 18, 1990

19(1)

This is in reply to your letter of July 22, 1990 concerning the tax treatment of  24(1)

As we understand it  24(1)

In your letter, you enclosed a copy of a Press Release issued by the Department of Finance in 1988 describe proposed changes to the Income Tax Act clarifying that certain counselling services provided for employees by their employers will not be treated as taxable benefits. In order to fit within the new rules announced by the Department of Finance the counselling services must be provided by the employer.

From our telephone conversation on September 7, we understand that you 24(1). It is, therefore, our view that this amount was a retiring allowance within the meaning of subsection 248(1) of the Income Tax Act which includes any amount received in respect of the loss of an office or employment, whether received on account of damages or otherwise. A retiring allowance is required to be included in income under subparagraph 56(1)(a)(ii) of the Income Tax Act.

There is no provision in the Income Tax Act that allows an employee to deduct the cost of obtaining counselling services of the nature described in the above-mentioned Press Release.

We regret that our reply could not have been favourable.

Yours truly,

for DirectorBusiness and General DivisionRulings DirectorateLegislative and IntergovernmentalAffairs Branch