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.
Cal Brown
XXXXXXXXXX (613) 957-8980
952658
Attention: XXXXXXXXXX
January 18, 1996
Dear Sir\Madam:
Re: Canadian Video or Film Production - Tax Credit
This is in reply to your letter of October 6, 1995, concerning the capital cost allowance and other incentives available in respect of certified Canadian productions. We apologize for the delay in responding to your request. You are concerned that the newly proposed tax credit for Canadian films or video productions will not allow your film project for 1995 to take advantage of the capital cost allowance/tax shelter arrangements that were previously available.
It is proposed that taxpayers may use either the new investment tax credit or the capital cost allowance/tax shelter system for 1995. After 1995, the tax credit system will replace the former incentive. It should be noted that the new legislation is not law at present and consequently could be amended.
The proposed amendments provide that the tax credit is not available where deductions in respect of the film project are available to an "investor" (usually a tax shelter investor) who is not actively engaged in film production. Consequently, in 1995 (the transitional year), a taxpayer will not be able to utilize the tax credit system if the capital cost allowance/tax shelter system is used.
We trust these comments will be of assistance.
Yours truly,
for Director
Manufacturing Industries, Partnerships
and Trusts Division
Income Tax Rulings and Interpretations Directorate
Policy and Legislation Branch
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