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. Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
CTF Nov 1992
C. Dubé
0-922848
October 16, 1992
Question 43
Does the Department accept as correct the decision of the Tax Review Board in Watson Construction Limited v. M.N.R., 79 DTC 528, to the effect that section 76 applies only to cash-basis taxpayers and not to accrual-basis taxpayers?
Answer
In the Watson case, the Tax Review Board concluded that it could not see how section 76 of the Act could apply since the amount in question was not an amount that could be included in computing income if it had been paid. There is no statement in the decision to the effect that section 76 applies only to cash-basis taxpayers.
Section 76 is part of subdivision f of the Act which determines certain rules relating to computation of income of a taxpayer. As stated in subsection 76(3), it was enacted for greater certainty and should not be construed as limiting the generality of the other provisions of Part I of the Act.
While section 76 places cash-basis taxpayers on an accrual basis with respect to income debts, its application could involve accrual-basis taxpayers for instance when a security is received by a non-resident in satisfaction of an amount subject to Part XIII tax, pursuant to subsection 214(4) of the Act.
Applicable sections of the Act: 76, 214(4)
All rights reserved. Permission is granted to electronically copy and to print in hard copy for internal use only. No part of this information may be reproduced, modified, transmitted or redistributed in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, or stored in a retrieval system for any purpose other than noted above (including sales), without prior written permission of Canada Revenue Agency, Ottawa, Ontario K1A 0L5
© Her Majesty the Queen in Right of Canada, 1992
Tous droits réservés. Il est permis de copier sous forme électronique ou d'imprimer pour un usage interne seulement. Toutefois, il est interdit de reproduire, de modifier, de transmettre ou de redistributer de l'information, sous quelque forme ou par quelque moyen que ce soit, de facon électronique, méchanique, photocopies ou autre, ou par stockage dans des systèmes d'extraction ou pour tout usage autre que ceux susmentionnés (incluant pour fin commerciale), sans l'autorisation écrite préalable de l'Agence du revenu du Canada, Ottawa, Ontario K1A 0L5.
© Sa Majesté la Reine du Chef du Canada, 1992