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.
SUMMARY: Amendment to a letter (document 942143) written by Revenue Canada in 1994 regarding an interpretation of paragraph 3 of Article 12 of the Canada–United Kingdom Income Tax Convention as it applies to royalties on videotapes.
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.
PRINCIPAL ISSUES:
Article 12 of the Canada-U.K. Convention - payments for the production and reproduction of works on videotape - correction of 942143, December 20, 1994
POSITION:
See letter.
REASONS:
Law and our understanding of the intention of our negotiators.
970001 XXXXXXXXXX J. Stalker
February 24, 1997 Dear XXXXXXXXXX
Re: Article XII of the Canada-U.K. Convention
We are writing in follow-up to our letter to you dated December 20, 1994 (our file 942143, David R, Senécal) to inform you that the comments in paragraph 4 of that letter in respect of the interpretation of paragraph 3 of Article 12 of the Canada-U.K. Income Tax Convention do not accurately reflect our position. Our position is that payments in respect of the production or reproduction of motion pictures, whether or not they are on videos destined for private (home) use, are not exempt from taxation in Canada under paragraph 3 of Article 12 of the Canada-U.K. Income Tax Convention. Royalties in respect of the production or reproduction of other works on videotape are exempt from Canadian tax under that provision, unless they are for use in connection with television broadcasting.
Yours truly,
for Director Reorganizations and International Division Income Tax Rulings and Interpretations Directorate Policy and Legislation Branch
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© Her Majesty the Queen in Right of Canada, 1997
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