Translations of recent severed letters

Bundle Date Translated severed letter Summaries under Summary descriptor
2017-10-18 5 June 2017 Internal T.I. 2014-0561391I7 F - Deemed security pursuant to 220(4.51) Income Tax Act - Section 220 - Subsection 220(4.51) s. 220(4.51) exemption from providing security for deferred emigration tax on up to $100,000 of capital gains is available for larger gains
2017-10-04 27 June 2017 External T.I. 2017-0708951E5 F - TSFA - Conditions Income Tax Act - Section 146.2 - Subsection 146.2(4) (apparently permitted) covenant in TFSA declaration requiring asset minimum to support loan to holder
Income Tax Act - Section 146.2 - Subsection 146.2(2) - Paragraph 146.2(2)(a) negative covenant in favour of lender to TFSA holder permitted
2017-09-13 21 July 2017 Internal T.I. 2017-0714931I7 F - Retiring allowance - Sick Leave Income Tax Act - Section 248 - Subsection 248(1) - Retiring Allowance payout of accumulated (non-excess) sick leave credits on termination of employment was a retiring allowance
Income Tax Act - Section 248 - Subsection 248(1) - Death Benefit includes payout on death of accumulated (non-excess) sick leave credits
Income Tax Act - Section 5 - Subsection 5(1) payout on termination of accumulated sick leave credit is employment income to extent otherwise would have been paid at year end
2017-09-06 28 October 2016 External T.I. 2016-0654331E5 F - Transfer of rights to income Income Tax Act - Section 9 - Nature of Income where rental lands purchased subject to obligation to pay the rents to vendor, rents did not have quality of income to purchaser under s. 9
Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Incurring of Expense where rental lands purchased subject to obligation to pay the rents to vendor, no income inclusion and deduction of the rents by the purchaser under ss. 9 and 18(1)(a)
Income Tax Act - Section 56 - Subsection 56(4) where rental lands purchased subject to obligation to pay the rents to NAL vendor, s. 56(4) trumps s. 9 to include rents in purchaser’s income
Income Tax Act - Section 56 - Subsection 56(2) s. 56(2) could apply to shareholder of purchaser of lands if vendor did not pay FMV consideration for retaining rights to rents
2017-08-23 21 June 2017 External T.I. 2016-0678361E5 F - Capital Dividend Account Income Tax Act - Section 89 - Subsection 89(1) - Capital Dividend Account - Paragraph (a) - Subparagraph (a)(i) - Clause (a)(i)A) negative ACB gain realized by a partnership is subject to the exclusion for s. 40(3.1) gains when allocated to a partner
Income Tax Act - Section 96 - Subsection 96(1) - Paragraph 96(1)(f) a negative ACB gain retains its character when allocated
2017-08-09 12 May 2017 External T.I. 2017-0683511E5 F - Purpose tests of a dividend or repurchase of share Income Tax Act - Section 55 - Subsection 55(2.1) - Paragraph 55(2.1)(b) - Subparagraph 55(2.1)(b)(ii) redeeming common shares otherwise than out of safe income may be GAARable
Income Tax Act - Section 55 - Subsection 55(3) - Paragraph 55(3)(a) using s. 55(3)(a) to distribute cash otherwise than from safe income likely abusive
Income Tax Act - Section 245 - Subsection 245(4) use of s. 55(3)(a) redemption exception to circumvent safe income limitation could be offensive
2017-08-02 12 July 2017 Ministerial Correspondence 2017-0697761M4 F - Publicité des plateformes Web étrangères Income Tax Act - Section 19.1 - Subsection 19.1(1) ads by Canadian advertisers on foreign websites generally are deductible
2017-07-26 28 June 2017 External T.I. 2016-0653921E5 F - Beneficiary/person beneficially interested Income Tax Act - Section 70 - Subsection 70(3) a testamentary trust could be a beneficiary or beneficially interested in an estate
Income Tax Act - Section 248 - Subsection 248(25) testamentary trust could be considered to have a right as beneficiary in estate
2017-07-12 21 November 2016 Internal T.I. 2016-0675761I7 F - Obligation de produire un T4A Income Tax Regulations - Regulation 200 - Subsection 200(1) artists’ union must issue T4A slips to incorporated artists respecting benefits received from the union
6 June 2017 External T.I. 2015-0617331E5 F - TFSA - Exempt Contribution Income Tax Act - Section 207.01 - Subsection 207.01(1) - Exempt Contribution - Paragraph (b) payment of family-law debt out of TFSA to surviving spouse would occur as a consequence of the deceased’s death
Income Tax Act - Section 248 - Subsection 248(23.1) - Paragraph 248(23.1)(a) payment of family-law obligation of deceased to surviving spouse out of deceased's TFSA could qualify
Income Tax Act - Section 248 - Subsection 248(8) - Paragraph 248(8)(a) legacy of residue (which included the residence) could be satisfied with TFSA of deceased
6 April 2017 External T.I. 2016-0658841E5 F - Purpose tests and Allocation of safe income Income Tax Act - Section 55 - Subsection 55(2.1) - Paragraph 55(2.1)(b) s. 55(2) would not apply to dividends paid only to purify of cash for QSBC-status purposes
Income Tax Act - Section 55 - Subsection 55(2.1) - Paragraph 55(2.1)(c) safe income was allocated between 2 classes of participating shares pro rata to their dividend entitlements
2017-07-05 7 June 2017 External T.I. 2016-0671731E5 F - Transfer of life insurance policy by dividend in kind Income Tax Act - Section 148 - Subsection 148(7) - Paragraph 148(7)(a) dividend-in-kind of a life insurance policy avoids the policy’s disposition at FMV
Income Tax Act - Section 52 - Subsection 52(2) proceeds and cost of distributed life insurance policy determined under s. 148(7) rather than s. 52(2)
2017-06-28 30 March 2016 Internal T.I. 2014-0547931I7 F - Voyages offerts par une compagnie Income Tax Act - Section 9 - Nature of Income full value of incentive trips, including business portion, included in income of recipient personal corporations
Income Tax Regulations - Regulation 200 - Subsection 200(1) company providing free trips to incorporated sales reps is required to T4A the individuals if they received the trip qua employee (but not shareholder) of their corporation
9 March 2017 External T.I. 2017-0689241E5 F - Avantages imposables relatifs aux automobiles ou autres véhicules Income Tax Act - Section 248 - Subsection 248(1) - Automobile emergency vehicle's markings must clearly mark it as police or fire vehicle
Income Tax Act - Section 6 - Subsection 6(2) even where a vehicle available 24 hours a day to a fire chief is clearly marked as a firefighter car, the employer must still estimate whether there is a personal-use benefit
15 May 2017 External T.I. 2016-0645891E5 F - Services rendered to a State Treaties - Income Tax Conventions - Article 18 public-sector nurse did not provide services “to Switzerland” for purposes of Art. 18(2)(a) of the Canada-Swiss Treaty
2017-06-21 29 May 2017 External T.I. 2014-0537111E5 F - Consequential assessment Income Tax Act - Section 152 - Subsection 152(4.3) reassessing to increase closing inventory permits a s. 152(4.3) reassessment to change the taxes payable "balance" for the following year
Income Tax Act - Section 10 - Subsection 10(2) reassessing to increase closing inventory permits reassessment to increase next year's COS
9 March 2017 External T.I. 2016-0680071E5 F - Règles transitoires - immobilisations admissibles Income Tax Act - Section 13 - Subsection 13(38) - Paragraph 13(38)(d) s. 13(38)(d)(iii) election can be available notwithstanding that only a minor pre-2017 ECE was incurred
10 May 2017 External T.I. 2017-0687051E5 F - Addition to ACB of a partnership interest Income Tax Act - Section 53 - Subsection 53(1) - Paragraph 53(1)(e) - Subparagraph 53(1)(e)(i) no s. 53(1)(e) addition for s. 34.2(2) stub period income inclusion
Income Tax Act - Section 34.2 - Subsection 34.2(2) no partnership-interest ACB addition for inclusion
11 May 2017 External T.I. 2016-0679751E5 F - TFSA - Exempt Contribution Income Tax Act - Section 207.01 - Subsection 207.01(1) - Exempt Contribution - Paragraph (b) a “survivor payment” can be made out of the deceased’s TFSA even where this occurs in the executor’s discretion
Income Tax Act - Section 248 - Subsection 248(8) - Paragraph 248(8)(a) legacy made by executor exercising discretion conferred under will occurred because of death
12 May 2017 External T.I. 2016-0649841E5 F - Dividend Refund to Private Corporation Income Tax Act - Section 129 - Subsection 129(1) - Paragraph 129(1)(a) CRA automatically pays available dividend refunds even when not claimed (or wanted)
2017-06-07 21 November 2016 Internal T.I. 2016-0641961I7 F - DSU Plan Income Tax Regulations - Regulation 6801 - Paragraph 6801(d) - Subparagraph 6801(1)(d)(i) potential change-of-control redemption trigger (and Code s. 409A triggers) were offside

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