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.
January 31, 1984 HEAD OFFICE Corporate Rulings Directorate M. Carsley Tel: 593-6937
ATTENTION J.H. MacLean Business Audit
This is in reply to your memorandum of December 9, 1983 in which you requested our opinion on several issues in respect of your audit of XXXX
(1) The determination of the fair market value for the bareboat charter is not an area dealt with by this Directorate. We suggest you refer this matter to your valuation department.
(2) The application of Article IV of the Canada-U.S. Tax Convention is a question of fact. If the bareboat charter fees charged to XXXX are similar to those which would be charged to an independent enterprise then Article IV of the Canada-U.S. Tax Convention will not apply. That determination is not an area dealt with by this Directorate. We have referred the issue to R.S. Hall, Director of the Specialized Audit Division.
(3) Assuming the U.S. citizens are taxable in the United States on their mobilizations wages, these amounts would not be subject to Canadian income tax because the services were performed outside Canada.
If you require further information please do not hesitate to contact the writer.
Chief Mines, Oil & Forest Industries Section Specialty Corporations Rulings Division Corporate Rulings Directorate Legislation Branch
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