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.
970637
XXXXXXXXXX M.P. Sarazin
Attention: XXXXXXXXXX
March 26, 1997
Dear Sirs:
Re: Home Buyers' Plan and Bankruptcy
This is in reply to your letter dated February 21, 1997, wherein you requested that we reconsider the position expressed in our letter dated February 13, 1997 (file #970313) (the "Letter").
You continue to be of the view that when funds are withdrawn from a registered retirement savings plan ("RRSP") under the Home Buyers' Plan ("HBP") an obligation to repay the withdrawal is created and the obligation would constitute a debt for purposes of the Bankruptcy and Insolvency Act.
We have reviewed the position expressed in the Letter and we remain of the view that a withdrawal from an RRSP under the HBP is not a debt or borrowing since there is no entity to which the bankrupt owes money. Consequently, the Letter continues to reflect our position with respect to a bankrupt and his or her subsequent income inclusions under the Income Tax Act as a result of the bankrupt's participation in the HBP.
We are sorry our reply could not be more favourable. If you wish to obtain additional clarification regarding the policy behind the legislation, we suggest that you write the Tax Policy Branch of the Department of Finance, L'Esplanade Laurier, 140 O'Connor Street, Ottawa, Ontario, K1A 0G5.
Yours truly,
for Director
Financial Industries 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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© Sa Majesté la Reine du Chef du Canada, 1997
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