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.
CTF Nov 1992
Question 20
Shareholder Loan - Acquisition of Dwelling
Subparagraph 15(2)(a)(ii) of the Act provides an exclusion from the general provision of subsection 15(2) in the case where, (once other conditions are met) a dwelling is acquired for the individual's habitation.
Interpretation Bulletin - IT-119R3, paragraph 18, states that "Loans made or indebtedness arising in respect of repairs, alterations, renovations or additions made to a dwelling are not considered to qualify for the exception under subparagraph 15(2)(a)(ii)".
What is Revenue Canada's position when a dwelling is acquired with the intention to perform repairs, alterations, or renovations prior to its becomings inhabited or shortly after becoming inhabited?
Answer
It is Revenue Canada's position that the exception in subparagraph 15(2)(a)(ii) of the Act will not apply to loans made or indebtedness arising in respect of repairs, alterations or renovations to the dwelling whether they are performed prior to or after the dwelling is inhabited.
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