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.
952860
XXXXXXXXXX M. Eisner
Attention: XXXXXXXXXX
November 22, 1995
Dear Sirs:
Re: Paragraph 56(1)(n)
This is in reply to your letters of May 25 and October 26, 1995 concerning a scholarship program that is to be established by XXXXXXXXXX.
You have set out a situation that involves proposed transactions. The income tax implications resulting from proposed transactions are confirmed by this Department only by way of an advance income tax ruling as described in Information Circular 70-6R2 and the related Special Release dated September 28, 1992. If you would like to obtain such a ruling on XXXXXXXXXX proposed scholarship program, kindly submit a request following the guidelines set out in the information circular and special release, copies of which are enclosed. However, we offer the following general comments.
You have made reference to the Department's reply to a question raised at the 1995 Tax Executive Institute Conference on the issue. The question concerned whether a scholarship, fellowship, or bursary paid by an employer to an employee's child is subject to tax in the hands of the child pursuant to the provisions of paragraph 56(1)(n) of the Income Tax Act (the Act) or in the hands of the employee (parent) under paragraph 6(1)(a) of the Act.
The Department's general position on the issue raised is outlined in paragraph 8 of Interpretation Bulletin IT-75R3, a copy of which is also enclosed.
We trust our comments will be of assistance to you.
Yours truly,
P.D. Fuoco
Section Chief
Personal and General Section
Business and General Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch
Enclosures
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© Her Majesty the Queen in Right of Canada, 1995
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© Sa Majesté la Reine du Chef du Canada, 1995
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