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: Prepaid Funeral Expenses
This is in response to your letter of August 9, 1993 concerning interest earned on funds to provided prepaid funeral services.
As you know, our previous correspondence on this subject indicated that contributors are required to report the interest earned annually commencing in 1993. However, we have been informed that the Department of Finance is preparing an amendment to the Income Tax Act which will legislate the administrative practice set out in IT-246. This practice was to permit the reporting of all interest accumulated on prepaid funeral arrangements either by the contributor at the time of withdrawal upon cancellation of the contract, or by the funeral director at the time the monies were applied against the cost of the services provided by the funeral home.
In view of this proposed amendment, the Department will continue its administrative practice until the legislation becomes law. Consequently, the reporting requirements will be the same as in previous years.
We trust that these comments will be of assistance.
M.A. Hiltz Acting Director GeneralRulings DirectorateLegislative and Intergovernmental Affairs Branch
c.c. W. Mizuik T2 and T3 Programs Division
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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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