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 962150
Agriculture Canada A.M. Brake
Ottawa, Ontario
K1A 0C5
Attention: April Steel, CMA
July 17, 1996
Dear Sirs:
Re: Agriculture Adaptation Grants
This is in reply to your letter of June 10, 1996 regarding the tax treatment of the rural development and agriculture grants to be made to the following organizations:
XXXXXXXXXX
We have not been provided with sufficient details to make conclusive comments as to whether the grants to these organizations or payments from these organizations to producer recipients would be "farm support payments" as defined in section 234 of the Income Tax Regulations which require AGR-1 Slips. Nevertheless, these grants and payments should be accounted for under generally accepted accounting principles by these organizations and producer recipients and would, in any event, be subject to paragraph 12(1)(x) of the Income Tax. In the event that these organizations qualify for non-profit exempt status, and it appears that XXXXXXXXXX could qualify, no tax would be exigible with respect to the receipt of the grants by these entities.
Whether a particular organization qualifies for exempt status as a non-profit organization in a particular year is a determination of fact to be made based on all of the facts. Since we have no background information as to the purpose for which these organizations were formed or any details regarding their actual objectives or operations, we are unable to make any substantive comment as to whether these organizations qualify for exemption under paragraph 149(1)(l) of the Act as non-profit organizations.
We trust our comments will be of assistance to you.
Yours truly,
R. Albert
for Director
Business and Publications Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch
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© Her Majesty the Queen in Right of Canada, 1996
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