Translations of recent severed letters

Bundle Date Translated severed letter Summaries under Summary descriptor
2018-04-11 6 October 2017 APFF Financial Strategies and Financial Instruments Roundtable Q. 1, 2017-0705221C6 F - Property transfers - common law partners in Québec Income Tax Act - Section 73 - Subsection 73(1.01) - Paragraph 73(1.01)(b) rollover under common-law partners' separation agreement irrespective of whether technically they have separation rights to settle
Income Tax Act - Section 146.3 - Subsection 146.3(14) rollover pursuant to common-law partners' settlement agreement
6 October 2017 APFF Financial Strategies and Financial Instruments Roundtable Q. 2, 2017-0710681C6 F - Withdrawal of RRSP over-contributions after death Income Tax Act - Section 146 - Subsection 146(8.8) income inclusion under s. 146(8.8) on death irrespective whether premiums exceeded deductible amount
Income Tax Act - Section 146 - Subsection 146(8.2) deemed s. 146(8.8) benefit on death treated as RRSP withdrawal, and executor should not use Form T746
6 October 2017 APFF Financial Strategies and Financial Instruments Roundtable Q. 4, 2017-0707781C6 F - Withdrawal of undeducted RRSP contributions Income Tax Act - Section 146 - Subsection 146(8.2) s. 146(8.2) deduction for withdrawing excess contributions can be available even where Pt X.1 tax is not applicable
6 October 2017 APFF Financial Strategies and Financial Instruments Roundtable Q. 5, 2017-0707801C6 F - RRIF transfers – partition of family patrimony Income Tax Act - Section 146.3 - Subsection 146.3(14) amount paid to surviving spouse's RRIF did not qualify under s. 146.3(14)
Income Tax Act - Section 146.3 - Subsection 146.3(1) - Designated Benefit payment from a deceased’s RRIF to the RRIF of the surviving spouse who was excluded under the will qualified as designated benefit
Income Tax Act - Section 60 - Paragraph 60(l) transfer from deceased's RRIF to RRIF of surviving spouse in settlement of claim
6 October 2017 APFF Financial Strategies and Financial Instruments Roundtable Q. 6, 2017-0707791C6 F - RRIF - Successive Deaths Income Tax Act - Section 146.3 - Subsection 146.3(1) - Designated Benefit death of the surviving spouse before she received payment of the testator’s legacy of his RRIF precluded access to the designated benefit rules
Income Tax Act - Section 146.3 - Subsection 146.3(6.1) s. 146.3(6.1) did not apply as the executor did not receive the RRIF legacy
6 October 2017 APFF Financial Strategies and Financial Instruments Roundtable Q. 8, 2017-0712621C6 F - Dépôt en monnaie étrangère-Immobilisation Income Tax Act - Section 39 - Subsection 39(1.1) non-application to FX deposits
Income Tax Act - Section 70 - Subsection 70(5) FX deposit treated as debt rather than s. 39(1.1) currency
6 October 2017 APFF Financial Strategies and Financial Instruments Roundtable Q. 9, 2017-0705231C6 F - Gift of a Life Insurance Policy and Subrogated Own Income Tax Act - Section 148 - Subsection 148(7) - Paragraph 148(7)(a) gain by estate on gift of policy based on cash surrender value
Income Tax Act - Section 118.1 - Subsection 118.1(1) - Total Charitable Gifts - Paragraph (c) - Subparagraph (c)(i) - Clause (c)(i)(C) claim in terminal return for charitable gift made by estate under individual’s will
Income Tax Act - Section 118.1 - Subsection 118.1(1) - Total Charitable Gifts - Paragraph (c) - Subparagraph (c)(i) - Clause (c)(i)(A) no guidance on whether designating a charity as a contingent policyholder generates a charitable credit
6 October 2017 APFF Financial Strategies and Financial Instruments Roundtable Q. 10, 2017-0705201C6 F - Capital loss - repayment of loan Income Tax Act - Section 40 - Subsection 40(3.3) the foreign currency deemed to be disposed of under s. 39(2) by an FX borrower on repaying a USD loan is not identical property to the USDs received by it under a replacement loan
Income Tax Act - Section 248 - Subsection 248(1) - Property foreign currency is not property for purposes of the suspended-loss rules
6 October 2017 APFF Financial Strategies and Financial Instruments Roundtable Q. 14, 2017-0708511C6 F - T1135 and 162(7) penalty Income Tax Act - Section 162 - Subsection 162(7) penalty for late-filing of a T1135 will be imposed automatically
Income Tax Act - Section 152 - Subsection 152(4) - Paragraph 152(4)(a) - Subparagraph 152(4)(a)(i) failure to file a T1135 treated as a misrepresentation – but neglect etc. ground to be determined
6 October 2017 APFF Financial Strategies and Financial Instruments Roundtable Q. 16, 2017-0705181C6 F - Hedging & George Weston Limited Income Tax Act - Section 9 - Capital Gain vs. Profit - Futures/Forwards/Hedges CRA is considering changing its policy re what is capital hedge
2018-04-04 20 February 2018 External T.I. 2017-0727811E5 F - Synthetic disposition Income Tax Act - Section 248 - Subsection 248(1) - Synthetic disposition arrangement an arrangement which eliminates all risk of loss nonetheless “appears” not to be a synthetic disposition arrangement if there is 20% profits participation
Income Tax Act - 101-110 - Section 110.6 - Subsection 110.6(1) - Qualified Small Business Corporation Share disposition could be deferred to end of 24 month period if deferred-closing agreement was not a synthetic disposition agreement
2018-03-14 18 December 2017 External T.I. 2017-0714971E5 F - Application of subsection 55(2) Income Tax Act - Section 55 - Subsection 55(2) relationship between Part IV tax and s. 55(2) and related amended return filings
Income Tax Act - Section 186 - Subsection 186(1) - Paragraph 186(1)(b) s. 55(2) application does not reduce s. 186(1)(b) initially reported Pt IV tax
2018-02-07 12 July 2017 Ministerial Correspondence 2017-0695331M4 F - Publicité sur des plateformes Web étrangères Income Tax Act - Section 19.01 - Subsection 19.01(2) ss. 19, 19.01 and 19.1 do not limit deductibility of ads on foreign websites
13 July 2017 Ministerial Correspondence 2017-0697311M4 F - Publicité sur des plateformes Web étrangères Income Tax Act - Section 19 - Subsection 19(1) ss. 19, 19.01 and 19.1 do not apply to advertising on foreign websites
2018-01-17 18 December 2017 External T.I. 2017-0720731E5 F - Eligible dividend designation Income Tax Act - Section 89 - Subsection 89(14) designations can be made before the dividend payment time and by email
2018-01-10 6 December 2017 External T.I. 2016-0667361E5 F - Taxable Capital Gains Designation Income Tax Act - 101-110 - Section 104 - Subsection 104(21.2) eligibility of a gain for the capital gains deduction is lost when it is distributed by a lower-tier to upper-tier trust
Income Tax Act - 101-110 - Section 110.6 - Subsection 110.6(1) - Annual Gains Limit annual gains limit of upper-tier trust does not include QSBC gains distributed and designated by lower-tier trust
2018-01-03 30 August 2017 External T.I. 2017-0718311E5 F - Capital dividend account Income Tax Act - Section 83 - Subsection 83(3) a late s. 83(3) election causes a retroactive increase to the CDA of the corporate recipient of the dividend
Income Tax Act - Section 89 - Subsection 89(1) - Capital Dividend Account - Paragraph (b) late capital dividend election retroactively affects CDA of dividend recipient
2017-12-27 27 October 2017 External T.I. 2017-0688971E5 F - New Class 14.1 Income Tax Act - Section 13 - Subsection 13(38) - Paragraph 13(38)(c) a s. 85 roll of purchased goodwill at an agreed amount of unamortized cost can trigger recapture
Income Tax Act - Section 13 - Subsection 13(39) non-application on s. 85 roll can result in recapture -but disposition bump available to NAL transferee
Income Tax Act - Section 85 - Subsection 85(1) - Paragraph 85(1)(e) permitted agreed amount for Class 14.1 property rollover must be UCC even where amortized cost (equalling boot) is higher
31 October 2017 External T.I. 2017-0690691E5 F - New section 15 back to back loan rules Income Tax Act - Section 15 - Subsection 15(2.16) - Paragraph 15(2.16)(c) - Subparagraph 15(2.16)(c)(i) - Clause 15(2.16)(c)(i)(B) application to a term deposit pledged by a family corporation to secure a business loan taken out by a shareholder
Income Tax Act - Section 15 - Subsection 15(2.16) - Paragraph 15(2.16)(c) - Subparagraph 15(2.16)(c)(ii) term deposit to secure shareholder loan potentially a specifed right
Income Tax Act - Section 18 - Subsection 18(5) - Specified Right pledged term deposit could be specified right
2017-12-06 23 October 2017 External T.I. 2017-0685001E5 F - Withdrawal of RRSP over-contributions after death Income Tax Act - Section 146 - Subsection 146(8.2) the deemed s. 146(8.8) RRSP benefit on death can be treated as a withdrawal of an excess RRSP contribution
3 November 2017 External T.I. 2017-0712141E5 F - Borrowing to make interest-free loans Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(c) - Subparagraph 20(1)(c)(i) interest on shareholders’ borrowings to fund an interest-free corporate loan may be deductible even if the proportionate-to-shares test is not met
2017-11-29 11 October 2017 Internal T.I. 2017-0719181I7 F - Agreement in writing Income Tax Act - Section 66.1 - Subsection 66.1(6) - Canadian exploration expense - Paragraph (g.4) pre-production mine development expenses that qualify under CEE – (g.4) need not qualify under (g.3)

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