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.
XXXXXXXXXX P. Spice
June 17, 1993
Re: Home Buyers' Plan
Your Reference XXXXXXXXXX
This is in reply to your letter of March 24, 1993, in which you ask us for administrative relief with respect to your client, XXXXXXXXXX. You indicate that XXXXXXXXXX withdrew an amount under the above-noted Plan in July, 1992, and also made a contribution to his registered retirement savings plan (RRSP) for the 1992 taxation year. XXXXXXXXXX now wishes to reverse his withdrawal under the Plan and deduct the aforementioned contribution to his RRSP.
The Rulings Directorate of this department is unable to grant administrative relief. If you wish to pursue this further, we suggest that you contact the district taxation office which serves the geographic area in which your client resides. We can provide the following general comments, however.
Once an "eligible amount" is received under the Home Buyers' Plan in accordance with proposed section 146.01 of the Income Tax Act (the "Act"), the recipient will be subject to an income inclusion under subsection 146.01(9) if certain amounts are contributed to an RRSP for the 1992 taxation year. In the circumstances described in your letter, and assuming XXXXXXXXXX acquired a "qualifying home" (defined in the draft legislation), then he will be subject to an income inclusion for the 1992 taxation year in the amount of $XXXXXXXXXX (the lesser of the amount he withdrew under the Plan and the amount he contributed to his RRSP).
If XXXXXXXXXX wishes to avoid this income inclusion and protect his unused RRSP deduction room, he may withdraw the full amount of his RRSP contribution of $XXXXXXXXXX using Form T3012A ("Waiver of Tax Withholding on a Refund of Undeducted RRSP Contributions Made In 19__"), available from the district taxation office. The amount must be withdrawn before 1994; and while it will be included in his income pursuant to subsection 146(8) of the Act, it is offset by a corresponding deduction under subsection 146(8.2) of the Act.
We are sorry we are unable to provide a more favourable reply but trust that the foregoing comments assist you in understanding the Plan provisions.
Financial Industries Division
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