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 subparagraph (a)(vii) of the definition of "qualified farm property" will apply to farm property which was substituted for farm property and acquired after June 17, 1987.
Position: No.
Reasons: Subparagraph (a)(vii) does not apply to property acquired after June 17, 1987, unless such property was acquired under an agreement entered into before that date.
September 21, 1999
Southern Interior B.C. Tax Services HEADQUARTERS
Office J. Gibbons
Business Enquiries (613) 957-8953
Client Services
Attention: Deby Dyke
7-992069
Qualified Farm Property - Subparagraph (a)(vii)
This is in response to your facsimile of July 20, 1999, in which you requested our views on the application of the above-mentioned provision. In particular, you seek our views concerning a particular situation outlined in a letter by XXXXXXXXXX.
The situation is described as follows:
1.Property A is farmed and acquired prior to June 18, 1987, and sold subsequent to June 17, 1987.
2.Property B is purchased after June 17, 1987 by the same taxpayer. This property is also farmed.
3.Income from farming is not the taxpayer's main source of income, nor is it a hobby farm.
Our understanding of the question is whether subparagraph (a)(vii) will apply to Property B, which was substituted for Property A and acquired after June 17, 1987.
Subparagraph (a)(vii) of the definition "qualified farm property" does not apply to property acquired after June 17, 1987, unless such property was acquired under an agreement entered into before that date. Thus, farm property acquired after June 17, 1987, including farm property which was substituted for farm property that may have qualified as qualified farm property" under subparagraph (a)(vii), will be subject to the rules in subparagraph (a)(vi) of the definition of qualified farm property," unless the property was acquired under an agreement before this date.
John Oulton
for Director
Business and Publications Division
Income Tax Rulings and Interpretations Directorate
Policy and Legislation Branch
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