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 the February 1992 accrued capital gain on a property should be attributed partially to the husband under 74(2) or 74.2(1) where the property has been transferred to his spouse before 1972?
Position TAKEN:
No.
Reasons FOR POSITION TAKEN:
Property transfer prior to 1972.
5-941882
XXXXXXXXXX L. Roy
Attention: XXXXXXXXXX
September 19, 1994
Dear Sir\Madam:
Subject: Attribution Rules
This is in reply to your letter of July 15, 1994 wherein you requested our opinion on whether the February 1992 accrued capital gain on a property should be attributed partially to the husband if the individual makes the election announced as part of the 1994 federal budget.
Written confirmation of the tax implications inherent in particular transactions are given by this Directorate only where the transactions are proposed and are the subject matter of an advance ruling request submitted in the manner set out in Information Circular 70-6R2, dated September 28, 1990. Where the particular transactions are completed, the enquiry should be addressed to the relevant district taxation office. The following comments are, therefore, of a general nature only, and are not binding on the Department.
Where an individual has transferred a property such as a building to his or her spouse, the attribution rules found in subsection 74.2(1) or previous subsection 74(2) of the Income Tax Act ("Act") would generally apply to attribute the capital gain on the disposition of the property to the individual and not his or her spouse.
However, subsection 74(2) of the Act only applies to property transferred after 1971 and subsection 74.2(1) of the Act applies to property transferred after May 22, 1985. Therefore, in the situation you have described, it is our view that since the building was built and transferred prior to 1972 that no part of the capital gain should be attributed in the husband income.
We trust the above comments will be of assistance to you.
Yours truly,
for Director
Financial Industries Division
Rulings Directorate
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, 1994
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, 1994
Email this Content