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: Treatment of air miles in so far as travel expenses incurred in
I 10.7(1)(a).
Position: Generally reduces the value of expenses incurred.
Reasons: This is consistent with the position taken in E9320858
August 6, 1999
National Overflow Call Center HEADQUARTERS
John Oulton
Attention: Valerie Andrews
991104Value of Air Miles
Northern Residents Deduction
This is in reply to your April 23, 1999, inquiry in which you requested our views regarding the value of air miles, as they pertain to travel expenses incurred for purposes of the Northern Residents deduction under paragraph 1 10.7(1)(a) of the Act. We apologize for the delay in responding.
A taxpayer, instead of paying cash or using a credit/debit card, may use his/her air miles to pay travel expenses (e.g., airline tickets, hotel room). It is our understanding that the value of the air miles used reduces the amount that the taxpayer is required to pay for the airline tickets or a hotel room. Accordingly, it is our general view that travel expenses have not been incurred to the extent that the air miles have reduced a taxpayer's travel costs. If you need further assistance on a particular fact situation, please do not hesitate to contact us.
For your information a copy of this memorandum will be severed using the Access to Information Act criteria and placed in the Legislation Access Database (LAD) on the Department's mainframe computer. A severed copy will also be distributed to the commercial tax publishers for inclusion in their databases. The severing process will remove all material that is not subject to disclosure, including information that could disclose the identity of the taxpayer. Should your client request a copy of this memorandum, they can be provided with the LAD version, or they may request a copy severed using the Privacy Act criteria, which does not remove client identity. Requests for this latter version should be made by you to Jackie Page at (819) 994-2898. The severed copy will be sent to you for delivery to the client.
John Oulton
For Director
Business and Publications Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch
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