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.
Registered Plans Division Financial Industries S.M. Kotlar Division Director
Attn: Jacques Y. Lalonde
Employee Mortgages as Investments for a Registered Pension Plan ("RPP") and reasonable rate of interest of mortgages - XXXXXXXXXX
This is in reply to your memorandum of June 29, 1993 concerning a request by the XXXXXXXXXX for the application of subparagraph 8514(2)(e)(iii) of the Regulations.
We share your opinion that the use of a reduction of .50% below the lowest advertised rate offered by the ten financial institutions would be a reasonable rate of interest, for the purpose of subparagraph 8514(2)(e)(iii) of the Regulations, in the circumstances described in your Memorandum, since such a reduction would allow the XXXXXXXXXX to remain competitive on the market and to retain its members who would not have to go to other financial institutions to obtain a better rate for a loan.
We trust the above comments will be of assistance to you.
Director Financial Industries DivisionRulings Directorate
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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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