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:Can an RRSP hold a part interest in a non-arm's length mortgage.
Position TAKEN:Yes
Reasons FOR POSITION:Consistent with IT320R2
July 13, 1994
Vancouver District Office Head Office
Section 471-24 Rulings Directorate
13th Floor Division (613) 957-8953
Attention: Jeff Derrick
7-941572
Qualified Investments for RRSPs
Interests in Non-arm's Length Mortgages
This is in reply to your facsimile of June 16, 1994, in which you asked for our comments on a letter received by your office from a XXXXXXXXXX dated June 2, 1994.
In accordance with paragraph 9 of Interpretation Bulletin IT320R2 it is our position that an interest in mortgage can be held by an RRSP when the mortgagor is the annuitant of the RRSP or a person that does not deal at arm's length with the annuitant. Accordingly, it is our opinion that two RRSPs can each hold an interest in a single mortgage provided each interest is owned by the respective RRSP and all of the remaining conditions for holding non-arm's length mortgages in an RRSP, as described in the IT Bulletin, are met.
for Director
Financial Industries Division
Rulings Directorate
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