Translations of recent severed letters

Bundle Date Translated severed letter Summaries under Summary descriptor
2025-09-17 19 June 2025 External T.I. 2024-1045841E5 F - Application of subsection 152(4.2) of the Act at death Income Tax Act - Section 152 - Subsection 152(4.2) the heir of a deceased employee who became entitled to a tax-free pay adjustment should count the s. 152(4.2) 10-year claim period from the year of payment
Income Tax Act - Section 5 - Subsection 5(1) retroactive pay adjustment that was agreed to after the employee’s death was non-taxable
Income Tax Act - Section 3 - Paragraph 3(a) retroactive pay adjustment that arose after death was tax-free
2025 Ruling 2025-1052291R3 F - Post-mortem Hybrid Pipeline Income Tax Act - Section 84 - Subsection 84(2) post-mortem pipeline entailing issuance of 8 quarterly notes by Newco 12 months after its acquisition of the stepped-up shares
Income Tax Act - Section 89 - Subsection 89(1) - Paid-Up Capital transactions contemplated the distribution of all the PUC of common shares
2025-09-03 3 June 2025 External T.I. 2025-1064821E5 F - Related persons Income Tax Act - Section 251 - Subsection 251(2) - Paragraph 251(2)(b) - Subparagraph 251(2)(b)(iii) repeated application of ss. 251(2)(b)(ii) and (iii) to relate two corporations
2025-08-27 4 July 2025 Internal T.I. 2025-1054791I7 F - Provincial allocation - CEWS Income Tax Regulations - Regulation 402 - Subsection 402(3) CEWS is excluded from gross revenue and wages for Reg. 402(3) purposes
Income Tax Regulations - Regulation 402 - Subsection 402(3) gross revenue does not include government assistance re expenses
2025-08-06 6 May 2025 External T.I. 2024-1010641E5 F - Relevant Group Entity Income Tax Act - Section 84.1 - Subsection 84.1(2.31) - Paragraph 84.1(2.31)(c) - Subparagraph 84.1(2.31)(c)(iii) the retention of Opco’s real estate in the parent’s Realtyco after a sale of Opco to the child’s Holdco does not render Realtyco a relevant group entity
2025-07-30 2024 Ruling 2024-1027631R3 F - Post-mortem planning - Pipeline Income Tax Act - Section 84 - Subsection 84(2) classical 24-month pipeline transaction for an investments company whose portfolio had performed poorly
1 May 2025 External T.I. 2024-1030911E5 F - Scholarships to non-residents to study French Income Tax Act - Section 118.94 scholarships received by non-resident temporary workers for French language training would be included in their worldwide income s. 118.94 computation purposes
Income Tax Act - Section 115 - Subsection 115(2) - Paragraph 115(2)(e) - Subparagraph 115(2)(e)(ii) scholarships received by non-resident temporary workers for French language training would not be included in their taxable income earned in Canada
2025-07-16 2024 Ruling 2024-1018811R3 F - RCA, Refundable Tax, Letter of credit Income Tax Act - Section 207.5 - Subsection 207.5(2) an RCA trust’s refundable Pt. XI.3 tax can be refunded through winding it up and replacing it by a new LC trust
2025-07-09 26 February 2025 Internal T.I. 2023-0985151I7 F - Remboursement de frais juridiques par un actionnaire à sa société / Reimbursement of legal fees by a shareholder Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Legal and other Professional Fees the vendor’s agreed reimbursement of the sold corporation’s legal costs of a failed suit in consideration for a dividend had the suit succeeded, likely was non-deductible
Income Tax Act - Section 42 - Subsection 42(1) - Paragraph 42(1)(b) - Subparagraph 42(1)(b)(ii) s. 42(1)(b)(ii) might apply to the vendor’s agreed reimbursement, post-sale, of the sold corporation’s legal costs of a failed suit
Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Incurring of Expense contingent dividend prospect likely did not support a deduction for an obligation to reimburse legal fees
22 May 2024 External T.I. 2024-1016211E5 F - Mineral Resource Cert - XXXXXXXXXX Income Tax Act - Section 248 - Subsection 248(1) - Mineral Resource - Paragraph (d) - Subparagraph (d)(i) NRC certification received
2025-07-02 29 April 2025 External T.I. 2024-1036641E5 F - Relevant Group Entity Income Tax Act - Section 84.1 - Subsection 84.1(2.31) - Paragraph 84.1(2.31)(c) - Subparagraph 84.1(2.31)(c)(iii) a Realtyco, whose shares qualified as QSBCS based on a related corporation’s active business, would be a “relevant group entity” on a sale of the latter’s shares
Income Tax Act - Section 84.1 - Subsection 84.1(2.32) - Paragraph 84.1(2.32)(c) - Subparagraph 84.1(2.32)(c)(iii) continued control of the related lessor to an Opco would violate the s. 84.1(2.32)(c)(iii) condition on a sale of Opco to a child’s purchaser corporation
2025-06-18 21 February 2025 Internal T.I. 2021-0902871I7 F - Déduction de frais de repas Income Tax Act - Section 67.1 - Subsection 67.1(2) - Paragraph 67.1(2)(c) a vendor’s disclosing on its invoices the amount of meal allowances paid to its sales people transferred the 50% s. 67.1 denial onto the purchasers
Income Tax Act - Section 67.1 - Subsection 67.1(1) purchaser was subject to 50% limitation on meal allowance amounts disclosed on the vendor’s invoices
2025-05-21 2 April 2025 External T.I. 2019-0818321E5 F - Reverse Earnout Income Tax Act - Section 12 - Subsection 12(1) - Paragraph 12(1)(g) capital gains and then capital loss treatment of an asset sale made on a reverse earnout basis accepted, where the targets were not achieved
Income Tax Act - Section 40 - Subsection 40(1) - Paragraph 40(1)(a) - Subparagraph 40(1)(a)(iii) no capital gains reserve is available for a reverse earnout
2025-05-14 2024 Ruling 2023-0970691R3 F - Part VI.1 of the Income Tax Act Income Tax Act - Section 248 - Subsection 248(1) - Short-Term Preferred Share - Paragraph (a) - Subparagraph (a)(i) Part VI.1 tax could apply to an agreement to repurchase common shares for their current FMV, if their FMV declines by the closing time
Income Tax Act - Section 248 - Subsection 248(1) - Taxable Preferred Share - Paragraph (f) TPS definition did not apply to common share repurchase agreement where repurchase price in fact did not exceed FMV at closing time
2025-05-07 31 December 2024 External T.I. 2021-0885741E5 F - CIAPH - habitation admissible Income Tax Act - Section 118.05 - Subsection 118.05(1) - Qualifying Home - Paragraph (a) - Subparagraph (a)(ii) s. (a)(ii) tested re occupancy as a “principal place of residence,” irrespective of whether the home was inside or outside Canada
Income Tax Act - Section 118.05 - Subsection 118.05(1) - Qualifying Home - Paragraph (a) - Subparagraph (a)(iii) s. (a)(iii) inapplicable if no spouse or common-law partner at the time of home acquisition
2025-04-23 4 January 2022 External T.I. 2016-0644861E5 F - Travail de nature temporaire Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) - Subparagraph 6(1)(a)(i) the "duties … of a temporary nature" condition is tested on a site-by-site basis
28 March 2025 External T.I. 2016-0662951E5 F - Alinéa b) de la définition d’action admissible de Income Tax Act - Section 110.6 - Subsection 110.6(1) - Qualified Small Business Corporation Share - Paragraph (b) settling QSBCS shares on a personal trust with related beneficiaries before a sale of those shares 6 months’ later would not cause QSBCS status to be lost
Income Tax Act - Section 110.6 - Subsection 110.6(14) - Paragraph 110.6(14)(f) settling QSBCS shares on a personal trust whose beneficiaries were related as required by s. 110.6(14)(c)(ii) permitted a sale thereafter without loss of QSBCS status
2025-04-16 4 March 2025 External T.I. 2024-1009691E5 F - Bump and Qualifying Exchange Income Tax Act - Section 88 - Subsection 88(1) - Paragraph 88(1)(c) a s. 132.2 exchange of MFC shares for MFT units precluded a s. 88(1)(d) bump of the MFT units
2025-04-09 2024 Ruling 2023-0998291R3 F - Multi-wings split-up net asset butterfly 55(3)(b) Income Tax Act - Section 55 - Subsection 55(1) - Distribution split-up butterfly between a divorced couple where excess debt is allocated to land rather than building to produce capital gains treatment
Income Tax Act - Section 85 - Subsection 85(1) - Paragraph 85(1)(b) excess debt allocated on s. 85(1) transfer of land and building to the land so as to produce capital gains rather than recapture
17 January 2025 Internal T.I. 2024-1029791I7 F - SSUC - Rémunération de la haute direction / CEWS - Income Tax Act - Section 125.7 - Subsection 125.7(1) - Executive Remuneration no adjustments are made to an eligible entity's Statement of Executive Compensation for NEOs filed pursuant to NI 51-102 for CEWS repayment purposes
Income Tax Act - Section 125.7 - Subsection 125.7(14) repayment based on NI 51-102 statements, without adjustments
2025-04-02 19 February 2025 External T.I. 2018-0744821E5 F - Régime d’assurance collective - groupe de personne Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) - Subparagraph 6(1)(a)(i) for a 2-person plan, a higher level of benefits for the majority shareholder would suggest that there was an individual policy for him, rather than being a group plan component
Income Tax Act - Section 15 - Subsection 15(1) rebuttable presumption that benefits of shareholder-employees from disability plan premiums were taxable/ meaning of "contemplated" shareholder
11 March 2025 External T.I. 2020-0845931E5 F - Transfert d’une propriété intellectuelle Income Tax Act - Section 9 - Capital Gain vs. Profit - Patents and Know-How the consequences of a sale of IP by a partnership for the benefit of a university and its researchers might be addressed in a ruling
2025-03-12 30 December 2024 Internal T.I. 2024-1031721I7 F - Notion de déclarant et statut d’Indien Income Tax Act - Section 233.3 - Subsection 233.3(1) - Specified Canadian Entity - Paragraph (a) - Subparagraph (a)(iii) exemption of income under the Indian Act does not render the individual as exempt from Part I tax, so that T1135/ T1134 reporting is required
Other Legislation/Constitution - Federal - Indian Act - Section 87 individuals whose income is exempted under the Indian Act nonetheless are subject to the general T1135 and T1134 reporting obligations

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