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.
December 23, 1993
| Edmonton District Office |
Head Office |
| Source Deductions |
Rulings Directorate |
| |
(613) 957-8953 |
Attention: D. Hamel
Overseas Employment Tax Credit ("OETC")
This is in reply to your memorandum of November 15, 1993 in which you asked us to confirm the Department's position with respect to Keith Harding's Decision Summary of November 17, 1992.
In particular, you asked the following questions:
(a) Whether employees of a sub-contractor can qualify for an OETC where the subcontractor is not carrying on a qualified activity under clause 122.3(1)(b)(i)(A) to (C) of the Act but the sub- contractor is carrying on business outside Canada with respect to such a qualified activity.
(b) Whether the main contractor, with whom the sub-contractor enters into a contract, must be a "specified employer" as defined in paragraph 122.3(2)(a) of the Act in order for the employees of a sub-contractor to qualify for the OETC.
Our Responses
In connection with the situation described in (a) above, it is our position that employees of a sub-contractor may qualify for an OETC notwithstanding the fact that the sub-contractor itself is not carrying on a qualified activity provided that their employment duties are performed outside Canada in connection with a contract under which the sub-contractor carried on business outside Canada with respect to a qualified activity.
XXXXXXXXXX
With respect to (b) above, the fact that the main contractor is not a "specified employer" under paragraph 122.3(2)(a) of the Act will have no effect on whether an employee of the sub-contractor is entitled to an OETC. However, if the sub-contractor (i.e. the specified employer) is not carrying on a qualified activity described in clause 122.3(1)(b)(i)(A) to (C) of the Act, the main contractor must be carrying on such a qualified activity in order for an employee of the sub-contractor to be able to satisfy the condition in subparagraph 122.3(1)(b)(i) of the Act.
for DirectorReorganizations and Foreign DivisionRulings DirectorateLegislative and Intergovernmental Affairs Branch
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