10 February 1998 Income Tax Severed Letter E9733698.txt - ONTARIO TEACHERS' ACTION - COMPENSATION

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.

ADM'S OFFICE (2) 97-1690D &
RETURN TO 15TH FLOOR, ALBION TOWER 97-07553M

February 10, 1998

XXXXXXXXXX

Dear XXXXXXXXXX:

I am writing in response to your letter of December 4, 1997, to Mr. Rob Wright, Deputy Minister of National Revenue, in which you suggest that the Department tax all payments made by Ontario School Boards to parents and guardians, as a result of the recent action of the Province's teachers.

Pursuant to legislation enacted by the Government of Ontario, the school boards will provide parents or guardians of eligible children with payments of $40.00 per day for each school day on which the children could not attend school or a child care facility located on school premises due to the teachers’ action. An eligible child is an elementary or secondary school student who is either under the age of 14 years or, by reason of disability, requires special care or supervision, or a child who normally attends a child care facility located on school premises. These payments are not reimbursements of any expenses, and there is no requirement that any expense be incurred in order to receive such payments.

The Department is responsible for administering the Income Tax Act as passed by Parliament. The Act taxes income by source, such as employment, business and property. Since the compensation to be received by Ontario parents and guardians is not income from a source for purposes of the Act, it will not be subject to income tax. There is also no legislative requirement that such payments be reported on an information slip.

I trust my comments have addressed your concerns.

		Yours sincerely,
		Denis Lefebvre
Assistant Deputy Minister
Policy and Legislation Branch

M. Azzi
957-8972
January 14, 1998