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.
933703
XXXXXXXXXX A.M. Brake
Attention: XXXXXXXXXX
March 8, 1994
Dear Sirs:
Re: AGR-1 Slips
This is in reply to your letter of December 15,1993, wherein you asked for clarification as to whether AGR-1 Information Slips should be issued to producers who are in receipt of interest-free loans for up to 5 years.
Income Tax Regulation 234 which defines "farm support payments" to include
(a)a payment that is computed with respect to farm acreage or other area of land,
(b)a payment that is made in respect of a unit of commodity or animal grown, raised or disposed of, and
(c)a rebate of or compensation for all or a portion of
(i) a cost or capital cost incurred in respect farming, or
(ii) unsowed land or crops, destroyed crops or output or destroyed animals.
It is our understanding that no amount in respect of interest is to be paid to the producer or to any other person on his behalf. Also, no amount would be deductible in computing income in respect of this free interest. In our view, as expressed in a recent telephone conversation (Brake/XXXXXXXXXX), there would not be any farm support payments received by the producer in respect of the interest-free loans and AGR-1 Slips would not be required.
We trust that we have clarified this matter.
Yours truly,
R. Albert
for Director
Business and General Division
Rulings Directorate
Legislative and Intergovernmental
Affairs Branch
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