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.
Principal Issues:
Whether a share of a corporation incorporated under the Companies Act of B.C. qualifies as a principal residence.
Position:
No
Reasons:
The share must be in a co-operative housing corporation which in B. C. would only apply to a corporation incorporated under the Cooperative Association Act. Similar queries with respect to Ontario corporations have been determined in the same manner.
970410
XXXXXXXXXX J.E. Grisé
(613)957-2059
February 26, 1997
Dear XXXXXXXXXX:
Re: XXXXXXXXXX
This is in reply to your letter of January 29, 1997 requesting an advance income tax ruling on whether a share owned by XXXXXXXXXX would qualify as their principal residence.
The question as to whether or not a property is the principal residence of a taxpayer is one of fact on which we do not provide an advance income tax ruling. Accordingly, the advance payment you have made will be refunded under separate cover.
As discussed in your telephone conversation with Jacques Grisé on February 24, 1997, it is our opinion that a share of a corporation incorporated under the Companies Act of British Columbia, would not qualify as a principal residence defined in section 54 of the Income Tax Act. In order for a share in a corporation to so qualify, it must be a share in a co-operative housing corporation. In our view, only a share of a housing corporation incorporated under the Cooperative Association Act of British Columbia could qualify as a principal residence in British Columbia, provided that the share was acquired for the sole purpose of acquiring the right to inhabit a housing unit owned by the corporation. These comments are reflected in paragraph 9 of Interpretation Bulletin IT-120R4, Principal Residence.
Yours truly,
John F. Oulton
for Director
Business and Publications Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch
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