Translations of recent severed letters

Bundle Date Translated severed letter Summaries under Summary descriptor
2003-06-27 24 June 2003 External T.I. 2002-0176475 F - DOMMAGES-INTERETS PROFESSIONEL Income Tax Act - Section 8 - Subsection 8(5) - Paragraph 8(5)(b) professional liability insurance premiums deductible under s. 8(5)(b)
23 June 2003 External T.I. 2003-0004795 F - TRANSPORT AU LIEU D'EMPLOI Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) mandatory employer-provided transport from staging area along difficult road to remote mine was not a taxable benefit
19 June 2003 Internal T.I. 2003-0021297 F - LOI SUR L'ACCISE PENALITES INTERETS Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Income-Producing Purpose GST/HST interest deductible if incurred re deductible expenditure/ penalties may also be deductible
Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(t) GST/HST interest and penalties are deductible based on application of ordinary principles
2003-06-20 16 June 2003 Internal T.I. 2003-0007867 F - COMPENSATION LORS DU DECES D'UN PARENT
Income Tax Act - Section 81 - Subsection 81(1) - Paragraph 81(1)(g.1) compensation for loss of financial support due to parental death did not qualify
10 June 2003 External T.I. 2003-0017065 F - Disp. of Property owned on Dec 31, 71 Income Tax Act - Section 85 - Subsection 85(5) the capital cost is not reduced by s. 85(5) for non-CCA/recapture purposes
Income Tax Application Rules - Subsection 20(1) 2 detailed examples of the application of ITAR 20(1)
10 June 2003 External T.I. 2003-0018915 F - Attribution - Transfers & Loans to Corp. Income Tax Act - Section 74.5 - Subsection 74.5(6) s. 74.5(6) applied to an estate-freeze exchange by individual’s Holdco of Opco common shares for preferred shares so that family trust could subscribe for Opco common shares
12 June 2003 External T.I. 2003-0019725 F - Sale of Holding' Shares to OPCO Income Tax Act - Section 251 - Subsection 251(1) - Paragraph 251(1)(c) 3 unrelated individuals likely acting in concert where they act without separate interests to achieve a basis step-up re transactions that are irrelevant to the business of the other party (Opco)
Income Tax Act - Section 84.1 - Subsection 84.1(1) s. 84.1 likely applicable re transaction in which 3 unrelated individuals act in concert to step up shares in Opco
16 June 2003 External T.I. 2003-0020895 F - Association/Convertible Property Income Tax Act - Section 256 - Subsection 256(1.4) - Paragraph 256(1.4)(a) where multiple debenture holders hold convertible debentures, s. 256(1.4)(a) is to be applied as if all the debentures were exercised (so that each debenture holder is diluted by the others)
Income Tax Act - Section 251 - Subsection 251(5) - Paragraph 251(5)(b) where multiple debenture holders hold convertible debentures, s. 256(1.4)(a) is to be applied as if all the debentures were exercised simultaneously
13 June 2003 External T.I. 2003-0184285 F - ALLOCATION DE RETRAITE Income Tax Act - Section 248 - Subsection 248(1) - Retiring Allowance if no guarantee or offer of new employment, the individual has retired
2003-06-13 11 June 2003 External T.I. 2002-0175975 F - TRANSFERT-ENT. EXPLOITEE ACTIVEMENT Income Tax Act - Section 110.6 - Subsection 110.6(14) - Paragraph 110.6(14)(f) - Subparagraph 110.6(14)(f)(ii) application of 24-month test where assets of business transferred to partnership of individuals, transferred to corporation under s. 95(2), partnership wound-up under s. 98(3) and shares sold
Income Tax Act - Section 79.1 - Subsection 79.1(6) - Paragraph 79.1(6)(b) meaning of expenses incurred to protect creditor's rights
13 June 2003 External T.I. 2002-0177045 F - BOISSONS OFFERTES AUX EMPLOYES Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) FMV of free beverages marketed by employer and provided to its employees included in their income
Income Tax Act - Section 67.1 - Subsection 67.1(2) - Paragraph 67.1(2)(d) FMV of free beverages provided to employees included in their income, so that cost of beverages to employer deductible from its income
27 May 2003 Internal T.I. 2003-0005357 F - TRANSFERT DE PROPRIETE EFFECTIVE Income Tax Act - Section 248 - Subsection 248(1) - Disposition - Paragraph (e) whether a preliminary transfer of shares of the target to spouse represented a disposition to her turned on whether there was a transfer of ownership under the Civil Code
15 May 2003 Internal T.I. 2003-0014507 F - DEDUCTIBILITE DES INTERETS Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(c) - Subparagraph 20(1)(c)(i) interest deductible on money borrowed to acquire non-dividend-paying common shares
3 June 2003 Internal T.I. 2003-0181487 F - DEDUCTIBILITE DES INTERETS GARANTIE Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(c) - Subparagraph 20(1)(c)(i) guarantee of wholly-owned corporation’s debt given for income-producing purpose is satisfied with borrowed money on which interest may be deductible
Income Tax Act - Section 20.1 - Subsection 20.1(1) s. 20.1(1)(b)(iv) deductibility where guarantee of wholly-owned corporation’s debt given for income-producing purpose is satisfied with borrowed money and subrogated claim is worthless
2003-06-06 30 May 2003 Internal T.I. 2003-0000117 F - ALLOCATION AUTOMOBLE VERSÉE Income Tax Act - Section 53 - Subsection 53(2) - Paragraph 53(2)(c) - Subparagraph 53(2)(c)(v) allowance, or reimbursement for non-partnership expense, is treated as a distribution reducing the partner’s ACB
Income Tax Act - Section 96 - Subsection 96(1) - Paragraph 96(1)(a) fees, and usually "loan" interest, paid to a partner will be treated as draws rather than deductible expenses
Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(c) - Subparagraph 20(1)(c)(i) a loan by a partner to the partnership may be treated as a loan rather than a contribution of capital in special circumstances
30 May 2003 External T.I. 2003-0006005 F - EQUIVALENT TO SPOUSE Income Tax Act - Section 118 - Subsection 118(1) - Paragraph 118(1)(b) - Subparagarph 118(1)(b)(i) s. 118(1)(b)(i) test unlikely to be satisfied where one of couple is incarcerated
3 June 2003 External T.I. 2003-0012075 F - Safe Income and 104(13.1) Designation Income Tax Act - Section 55 - Subsection 55(2)
Income Tax Act - Section 55 - Subsection 55(2.1) - Paragraph 55(2.1)(c) income retained by a trust under s. 104(13.1) and then distributed to its corporate beneficiary was not included in the latter’s safe income
3 June 2003 Internal T.I. 2003-0019087 F - Calculation of 163(1) Penalty - Capital Gain Income Tax Act - Section 163 - Subsection 163(1) penalty computed on taxable capital gain, not capital gain
30 May 2003 External T.I. 2003-0182145 F - AVANTAGE IMPOSABLE-VOYAGE Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) no taxable benefit re free trip for a customer’s employee where employee spends at least 50% of the time on business-related activities
2003-05-30 15 April 2003 External T.I. 2002-0139305 F - Immigration Income Tax Act - Section 128.1 - Subsection 128.1(1) - Paragraph 128.1(1)(c) ss. 128.1(1)(b) and (c), unlike former s. 48(3), apply also for CCA/recapture purposes
Income Tax Act - Section 126 - Subsection 126(1) FTC can be generated where recapture of depreciation, and denied capital loss, are realized on a US rental building
Income Tax Act - Section 53 - Subsection 53(1) - Paragraph 53(1)(e) - Subparagraph 53(1)(e)(i) step-up of partnership interest on immigration to Canada neutralized the capital gain on partnership property when partnership wound up
5 May 2003 External T.I. 2002-0140805 F - Arrangements funéraire - Provision de 20(1)m) Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(m) non-refundable prepaid funeral amounts not held in trust were not eligible for the reserve
23 April 2003 External T.I. 2002-0155125 F - Rétribution Questionnaires - Actionnaires Income Tax Act - Section 67 scenario including non-resident corporation did not comply with ITTN No. 22
23 May 2003 External T.I. 2002-0172205 F - FIDUCIE DE BIEN-RE&S Income Tax Act - Section 18 - Subsection 18(9) - Paragraph 18(9)(a) - Subparagraph 18(9)(a)(iii) s. 18(9)(a)(iii) likely applies where employer makes a payment to a trust which uses insurance to fund employee health services
27 May 2003 External T.I. 2002-0176485 F - regime d'assurance-salaire Income Tax Act - Section 15 - Subsection 15(1) s. 15(1) benefit (e.g., from corporation paying premiums under wage loss replacement plan for shareholder) cannot be reduced by the shareholder repaying the benefit
26 May 2003 External T.I. 2002-0180455 F - MODIFICATION D'UNE POLICE EXONEREE Income Tax Regulations - Regulation 306 - Subsection 306(1) question of fact for insurer whether splitting a policy terminates its exempt status
21 May 2003 Internal T.I. 2003-0001407 F - DISPOSITIONS SUBJECT TO WARRANTY Income Tax Act - Section 42 s. 42 applied to payment of claim of purchaser based on latent defect in property and to legal fees
26 May 2003 Internal T.I. 2003-0002297 F - Fonds commun de placement-Dépenses gén. Income Tax Act - Section 104 - Subsection 104(6) allocation of expenses permitted to maximize dividend tax credits of MFT beneficiaries

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