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.
XXXXXXXXXX
Attention: XXXXXXXXXX
Dear Sirs:
RE: Employees Profit Sharing Plan
This is in response to your letter of February 8, 1993, in which you request the Department's interpretation of the application of subsection 144(1) of the Income Tax Act (the "Act").
We confirm that the position in paragraph 2 of Interpretation Bulletin IT-280 which states that profits for the purpose of subsection 144(1) of the Act, mean net income after taxes of a business arrived at by following generally accepted accounting principles. We are of the opinion that this position is fully supportable in law as it was developed on the basis of the decisions of the courts found in Lade vs MNR, 1964 DTC 5189 as confirmed by the Supreme Court and reported in 1965 DTC 5297. Since the relevant portion of the legislation has not changed in the interim and that court case has not been reconsidered nor qualified, it remains the authoritative view of what is meant by "computed by reference to profits from his business".
We trust this is satisfactory. If you have any further questions, do not hesitate to contact us.
Yours truly,
for the Director Financial Industries DivisionRulings Directorate
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, 1993
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, 1993
Email this Content