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.
Mr. Gordon R. White
Director
Financial Operations and
Special Projects 943360
Agriculture Canada A.M. Brake
Ottawa, Ontario
K1A 0C5
Attention: April Steel
June 29, 1995
Dear Sirs:
Re: NISA Bridge Program & Beef Industry Development Fund
This is in reply to your letter of December 16, 1994 requesting our comments as to the taxability of payments to producers from the above-noted programs. We apologize for the delay in replying.
We confirm that payments to producers from the NISA Bridge Program will, by virtue of subsection 12(10.2) of the Income Tax Act, constitute income to the recipient when payment is made from the NISA No. 2 account to either the NISA No. 1 account or to the producer directly. Accordingly, it will be necessary to report these amounts on AGR-1 Slips.
On the basis that participants in proposals, approved by the committee of the Beef Industry Development Program, are merely reimbursed for actual direct costs incurred in approved projects and that they receive no direct support from the fund as producers or processors, the reimbursement, in and by itself, will not constitute income in the hands of the recipients. Of course, expenses incurred would not be deductible in computing a participants income. However, if the amounts are other than a direct reimbursement of actual expenditures made on behalf of the fund, paragraph 12(1)(x) would have application and AGR-1 Slips will be required to report all amounts paid.
We trust our comments will be of assistance to you.
.
Yours truly,
R. Albert
for Director
Business and General Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch
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© Her Majesty the Queen in Right of Canada, 1995
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