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.
RULINGS DIRECTORATE
CORRESPONDENCE SUMMARY
Principal Issues:
Whether a life insurance policy can be absolutely assigned to more than one registered charity.
Position TAKEN:
Factual determination. Generally the answer would be yes as long as the insurance company is advised of the assignment, and the policy is assigned absolutely.
Reasons FOR POSITION TAKEN:
Principles of contract law.
950294
XXXXXXXXXX G. Donell
Attention: XXXXXXXXXX
June 29, 1995
Dear Sir:
Re: Gifts of Life Insurance Policies to a Charity
This is in reply to your letter of January 25, 1995 in which you requested clarification of a view expressed in our June 7, 1994 letter (File 940574) wherein we stated that "...a life insurance policy cannot be absolutely assigned to more than one registered charity." We apologize for the delay of our response.
In your letter and after consultation with your legal advisors you have expressed the view that you see no difference between having a donor transfer ownership of an insurance policy to more than one registered charity and having a piece of real estate or a security owned by joint or multiple owners.
It is our understanding that a transaction in which a single life insurance policy is assigned to multiple assignees that are registered charities is atypical. We have not had the occasion to review such a transaction and are accordingly unwilling to express a view as to the legal ramifications and resulting tax consequences without a thorough review of the facts surrounding such assignment including underlying documentation. We are, however depending upon the circumstances, prepared to reconsider our position where a life insurance policy is validly and legally assignable to multiple assignees and such assignment is affected absolutely.
We trust that the above comments are of assistance to you.
Yours truly,
Chief
Financial Institutions Section
Financial Industries Division
Income Tax Rulings and
Interpretations Directorate
Policy & Legislation Branch
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, 1995
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, 1995
Email this Content