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: Supplementary ruling re: doc no. 980008—ITA-85(1)(e)(i)—Advance income tax ruling - Amendments to advance income tax ruling.
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: With respect to the reference to paragraph 85(1)(e)(i) in the ruling, the taxpayer requested that the UCC to be allocated to each asset for the purposes of the joint election should be the proportion that the fair market value of the asset is of the fair market value of all property of that class, instead of the proportion that the cost of the asset is of the cost of all property of that class.
POSITION: This change is acceptable.
REASONS: Our position is administrative in nature, and has been accepted practice in other rulings.
XXXXXXXXXX XXXXXXXXXX 982368 XXXXXXXXXX
Attention: XXXXXXXXXX XXXXXXXXXX, 1998 Dear Sirs: Re: XXXXXXXXXX . Advance Income Tax Ruling our file No. 3-980008
We are writing in response to your recent telephone call (XXXXXXXXXX) wherein you requested changes to the Proposed Transactions described in the Advance Income Tax Ruling issued on XXXXXXXXXX, 1998 (the “Ruling”). Terms defined in the Ruling to have a certain meaning have the same meaning when used in this letter. As a result of your request, the following changes are made to the Ruling: 1. In paragraph 13, replace the entire subparagraph beginning with the words “For the purposes of the joint election described herein,” by the following:
“For the purposes of the joint election described herein, the reference to “the undepreciated capital cost to the taxpayer of all property of that class immediately before the disposition” found in paragraph 85(1)(e)(i) shall be interpreted to mean that proportion of the undepreciated capital cost to the taxpayer of all of the property of that class that the fair market value of the asset immediately before the disposition is of the fair market value of all property of that class immediately before the disposition.” We confirm that the above changes will not affect the rulings given in the Ruling and that, subject to the conditions set out therein, they will continue to be binding on the Department in accordance with the practice outlined in Information Circular 70-6R3 provided that the proposed transactions described in the Ruling are completed in the manner described therein by XXXXXXXXXX. Yours truly,
for Director Reorganizations and International Division Income Tax Rulings and Interpretations Directorate Policy and Legislation Branch
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