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.
July 15, 1998
XXXXXXXXXX
Dear XXXXXXXXXX:
Thank you for your letter of April 14, 1998, regarding the clergyman’s residence deduction provided in paragraph 8(1)(c) of the Income Tax Act, as it applies to members of the clergy who are married to other clergy.
I understand that you feel that, where both members of a clergy couple otherwise qualify for the clergyman’s residence deduction, each member should be entitled to claim this deduction in respect of 100 per cent of the rent paid for the residence, if they rent the residence, or 100 per cent of the fair rental value of the residence, if they own the residence. You feel that the Department has changed its position in this regard, and that reassessments should not be made retroactively.
Where a clergy couple rent their accommodation, the actual rent paid must be allocated between the spouses on a reasonable basis for purposes of the clergyman’s residence deduction. Similarly, when the residence is owned and occupied by the couple, the fair rental value of the residence should be allocated between the spouses on a reasonable basis. Paragraph 8(1)(c) was not intended to provide for a deduction of the same amounts by two taxpayers. This interpretation has not changed.
As a general rule, the Act authorizes the Department to make reassessments within three years from the date of the original assessment for a taxation year. This is an integral part of the Canadian tax system, which is one of
self-assessment. In a self-assessment system, it is often not until a subsequent review of a claim has taken place that it becomes known that the claim is not in accordance with the provisions of the Act.
The role of Revenue Canada is to administer and enforce the Act as passed by Parliament. The concerns raised in your letter relate to tax policy, which is the responsibility of the Department of Finance. As you have already relayed these concerns to the Honourable Paul Martin, Minister of Finance, in a letter of April 14, 1998, I am certain your views will receive every consideration.
I appreciate being made aware of your concerns.
Yours sincerely,
Herb Dhaliwal, P.C., M.P.
M. Azzi
957-8972
May 26 1998
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