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.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
XXXXXXXXXX 922320
C.R. Bowen
(613)
957-8585
Attention: XXXXXXXXXX
February 26, 1993
Dear Sirs:
Re: Paragraph 12(1)(x)
We are writing in reply to your letters of July 27, 1992 and February 18, 1993, wherein you requested our interpretation of the application of paragraph 12(1)(x) of the Income Tax Act (the "Act") in the situation where a payment is received as a reimbursement in respect of the cost of an eligible capital property. We apologize for the delay in responding to your letter.
We agree with your analysis that subsection 12(2.2) of the Act will not have application in respect of an amount received by a taxpayer relating to the capital cost of eligible property and that neither subsection 13(7.4) nor paragraph 53(2)(s) of the Act apply in respect of eligible capital property. Therefore, since subparagraph 12(1)(x)(vii) of the Act cannot be applied to reduce the cost of eligible capital property, the amount of a reimbursement, contribution or other form of assistance received in respect of that property must be included in computing the recipient's income.
Yours truly,
for Director
Manufacturing Industries, Partnerships
and Trusts Division
Rulings Directorate
Legislative and Intergovernmental
Affairs Branch
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© Her Majesty the Queen in Right of Canada, 1993
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© Sa Majesté la Reine du Chef du Canada, 1993
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