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.
Principal Issues:
Whether shares of a public corporation are qualified investments for RRSP's.
Position TAKEN:
Yes.
Reasons FOR POSITION TAKEN:
Pursuant to paragraph 4900(1)(b) of the Regulations.
XXXXXXXXXX 941278
Attention: XXXXXXXXXX
June 2, 1994
Dear Sirs:
Re: Qualified Investments for Registered
Retirement Savings Plans (RRSP's)
This is in reply to your facsimile of May 13, 1994, in which you ask whether the shares of your company are qualified investments for an RRSP.
The Department is unable to confirm whether any particular property would be a qualified investment for an RRSP since this is a matter of fact which must be determined at the time the property is acquired by the RRSP. We can offer, however, the following general comments for your information.
There are several types of shares which are qualified investments for an RRSP, one of which is described, as you point out, in paragraph 4900(1)(b) of the Income Tax Regulations. This provision states that a share in a public corporation is a qualified investment for certain deferred income plans, including RRSP's. "Public corporation" is defined in paragraph 89(1)(g) of the Income Tax Act (unless as otherwise stated all references to this statute are to the Income Tax Act S.C. 1970-71-72, c. 63 as amended, consolidated to June 10, 1993 - the "Act"). As noted in paragraph 5 of the enclosed Interpretation Bulletin IT-320R2 ("Registered Retirement Savings Plans - Qualified Investments"), it is possible for a corporation resident in Canada to be a public corporation notwithstanding that its shares are not listed on a prescribed stock exchange in Canada. See also paragraphs 3 and 4 of the enclosed Interpretation Bulletin IT-391 ("Status of Corporations"). We confirm that the XXXXXXXXXX is not a stock exchange prescribed under the Act.
Although the foregoing comments are not binding on the Department, we trust they are helpful.
Yours truly,
for Director
Financial Industries Division
Rulings Directorate
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