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.
PRINCIPAL ISSUES:
Whether an "interest" in a bond is a qualified investment for an RRSP.
POSITION TAKEN:
Maybe, depending on legal relationship established by documents among the parties.
REASONS FOR POSITION TAKEN:
Question of fact.
LEGAL:
N/A
FINANCE OPINION:
N/A
JURISPRUDENCE:
N/A
RCT PUBLICATIONS:
N/A
HAA NUMBER:
7255-7 933549 XXXXXXXXXX
Attention: XXXXXXXXXX
December 21, 1993
Dear Sirs:
RE: Qualified Investment
This is in reply to your facsimile transmission of December 3, 1993, in which you ask whether an interest in a global bond would be a qualified investment for a registered retirement savings plan (RRSP).
The situation you describe is a proposed transaction and, as indicated in Information Circular 70-6R2, we do not express opinions on specific proposed transactions other than as a reply to an advance income tax ruling. Furthermore, whether a particular investment is qualified for an RRSP is a question of fact and can only be determined at the time the investment is acquired by the plan. We can provide, however, the following general comments.
An "interest" in a bond or similar obligation that is a qualified investment for an RRSP pursuant to paragraph 4900(1)(i) of the Income Tax Regulations may also be such a qualified investment if the holder of the interest would have the same rights as a direct holder of the bond but for the interposition of an agent or bare trustee. Whether a particular interest is a qualified investment can only be determined after a review of the documents establishing the relationship between the affected parties.
Although the foregoing comments are not binding on the Department, we trust they assist.
Yours truly,
for DirectorFinancial 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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