Translations of recent severed letters

Bundle Date Translated severed letter Summaries under Summary descriptor
2005-08-05 7 July 2005 External T.I. 2005-0122191E5 F - Erroneous Elections in Statute-barred Years Income Tax Act - Section 110.6 - Subsection 110.6(19) no need to amend the s. 85(1) election where the agreed amount was less than the s. 85(1)(c.1) floor
13 July 2005 External T.I. 2005-0131351E5 F - Séparation des conjoints de fait Income Tax Act - Section 248 - Subsection 248(1) - Common-Law Partner common-law partnership of couple with a child resumed the moment they resumed living together
Income Tax Act - Section 74.5 - Subsection 74.5(3) - Paragraph 74.5(3)(a) attribution resumed when cohabitation resumed
Income Tax Act - Section 74.5 - Subsection 74.5(3) - Paragraph 74.5(3)(b) capital gain is attributed to transferor common-law partner if the property is sold after they resumed their relationship
2005-07-29 24 June 2005 External T.I. 2004-0109201E5 F - Professions libérales - Travaux en cours Income Tax Act - Section 34 a professional partnership carrying on a secondary non-professional activity may make the election
Income Tax Act - Section 4 - Subsection 4(1) - Paragraph 4(1)(a) income from a professional practice includes income from a secondary non-professional activity if the practice is a single business
28 June 2005 Internal T.I. 2005-0115721I7 F - Entreprise de prestation de services personnels Income Tax Act - Section 125 - Subsection 125(7) - Personal Services Business high degree of control and integration with the business of a corporation established that the respective services providers had PSBs
4 July 2005 External T.I. 2005-0117321E5 F - Sens de l'expression "frais de scolarité" Income Tax Act - Section 118.5 - Subsection 118.5(3) various components of registration fees qualified including additional fees to out-of-province students
Income Tax Act - Section 118.5 - Subsection 118.5(3) - Paragraph 118.5(3)(d) detailed listing of charges subject to s. 118.5(3)(d)
21 June 2005 Internal T.I. 2005-0120341I7 F - Paragraphe 80(15). Income Tax Act - Section 80 - Subsection 80(15) s. 80(15) forgiven amount can be applied against NCLs or ACB that are unconnected to the partnership
14 July 2005 External T.I. 2005-0129441E5 F - Fiducie réputée Income Tax Act - Section 149 - Subsection 149(1) - Paragraph 149(1)(o.4) s. 149(1)(o.4) extends to segregated funds
Income Tax Regulations - Regulation 4802 - Subsection 4802(1.1) a deemed trust under s. 138.1(1)(a) could be a master trust if the conditions in Reg. 5001 are satisfied
22 June 2005 External T.I. 2005-0136941E5 F - Don par testament Income Tax Act - Section 152 - Subsection 152(4.2) the terminal return could be requested after the normal reassessment period to be reassessed to reflect a gift under the will
19 July 2005 External T.I. 2005-0140871E5 F - Régime de pension étranger Income Tax Act - Section 60 - Paragraph 60(j) s. 60(j) deduction available for transfer from Swiss pension plan to RRSP
2005-07-22 13 July 2005 External T.I. 2005-0132631E5 F - Prestation fiscale canadienne pour enfants Income Tax Act - Section 122.61 - Subsection 122.61(1) Act does not preclude the sharing of the credit
2005-07-08 23 June 2005 Internal T.I. 2005-0118191I7 F - Améliorations faites à un séchoir à bois Income Tax Regulations - Schedules - Schedule II - Class 43 post-1992 alteration to equipment must be major in order to constitute a Class 43 addition
6 July 2005 External T.I. 2005-0123311E5 F - paiement à employé pour règlement d'un litige Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) amount received as compensation for tax on s. 7 benefit that was realized but never available to the employee was a s. 6(1)(a) benefit
Income Tax Act - Section 9 - Compensation Payments compensation for capital loss on stock option shares amount was taxed on capital account
21 June 2005 Internal T.I. 2005-0123551I7 F - Montant forfaitaire de pension alimentaire Income Tax Act - Section 56.1 - Subsection 56.1(4) - Support Amount support amounts included annual top-up amounts
24 June 2005 External T.I. 2005-0126251E5 F - Montants alloués pour personne handicapée Income Tax Act - Section 118 - Subsection 118(6) taxpayer could not claim the s. 118(1)(d) credit since she no longer was supporting her daughter
Income Tax Act - Section 118.3 - Subsection 118.3(2) parent could not take a transfer of the unused credit because she was no longer financially supporting her impaired daughter
5 July 2005 Internal T.I. 2005-0132671I7 F - Filing of Return - Corporation Being Wound Up Income Tax Act - Section 150 - Subsection 150(1) - Paragraph 150(1)(a) - Subparagraph 150(1)(a)(i) - Clause 150(1)(a)(i)(A) returns must be filed following winding-up until dissolution
2005-06-17 9 June 2005 External T.I. 2004-0097451E5 F - Régimes d'assurances collectives Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) - Subparagraph 6(1)(a)(i) employees can potentially pay top-up amounts for further benefits or receive taxable compensation for opting for lower benefits
Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(f) CRA criteria for determining whether there are 2 separate plans (one of which is fully employee-funded)
9 June 2005 Internal T.I. 2004-0105421I7 F - Déductibilité des frais juridiques et d'intérêts Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Damages legal fees to defend against claim for unpaid construction fees on building addition were on capital account
Income Tax Act - Section 13 - Subsection 13(21) - Undepreciated Capital Cost - A legal fees to defend against claim for unpaid construction fees on building addition were not a capital cost addition
Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(c) - Subparagraph 20(1)(c)(ii) interest paid pursuant to a judgment requiring payment of construction fees would be deductible but for s. 18(3.1)
Income Tax Act - Section 18 - Subsection 18(3.1) interest paid pursuant to a judgment requiring payment of construction fees would be capitalized to the construction costs to the extent of accrual during construction period
6 June 2005 External T.I. 2005-0114481E5 F - Division 149(1)o.2)(ii)(C) Income Tax Act - Section 149 - Subsection 149(1) - Paragraph 149(1)(o.2) - Subparagraph 149(1)(o.2)(ii) - Clause 149(1)(o.2)(ii)(B) deferred proceeds receivable for real estate sale do not qualify as real property
Income Tax Act - Section 149 - Subsection 149(1) - Paragraph 149(1)(o.2) - Subparagraph 149(1)(o.2)(ii) - Clause 149(1)(o.2)(ii)(C) loan that funded rental property acquisition may still qualify after partial sale of portfolio/replacement borrowing can also qualify
Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(c) - Subparagraph 20(1)(c)(i) loan that funded rental property acquisition may still qualify as “solely for the purpose of earning income” per s. 149(1)(o.2)(ii)(C) after partial sale of portfolio
9 June 2005 Internal T.I. 2005-0115481I7 F - Avantages imposables/voyages Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) since the particular shareholder-employees who benefited from trips provided by their employer’s supplier were known, the supplier should issue T4As to them
Income Tax Regulations - Regulation 200 - Subsection 200(2) - Paragraph 200(2)(g) T4As required to be issued to shareholder-employees of customers who were identifiable as receiving free trips – but not for sole proprietor customers
9 June 2005 Internal T.I. 2005-0117851I7 F - Choix du paragraphe 14(1.01) de la Loi Income Tax Act - Section 14 - Subsection 14(1.01) taxpayer could not make s. 14(1.01) election where "exempt gains balance" in respect of his business for the year is not nil
7 June 2005 External T.I. 2005-0121551E5 F - Déduction des intérêts - co-emprunteurs Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(c) - Subparagraph 20(1)(c)(i) interest on money borrowed from spouse under line of credit for income-producing purpose is deductible
7 June 2005 External T.I. 2005-0121921E5 F - Paiement à un emphytéote Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Improvements v. Repairs or Running Expense Belgega -finding that inducement paid to prospective emphyteuta (tenant) was capital expenditure - noted
Income Tax Act - Section 9 - Timing notwithstanding Canderel, tenant inducement payment must be amortized under matching principle if incurred for specific purposes of producing identifiable future revenue
9 June 2005 Internal T.I. 2005-0122511I7 F - Créance irrécouvrable dans une OSBL Income Tax Act - Section 39 - Subsection 39(1) - Paragraph 39(1)(c) - Subparagraph 39(1)(c)(iv) loss on interest-bearing loan made by a director to an NPO qualified as BIL if NPO qualified as SBC
Income Tax Act - Section 40 - Subsection 40(2) - Paragraph 40(2)(g) - Subparagraph 40(2)(g)(ii) a debt obligation bearing a reasonable rate of interest satisfies s. 40(2)(g)(ii)
2005-06-10 9 June 2005 External T.I. 2004-0092001E5 F - Droits indivis dans les actions Income Tax Act - Section 110.6 - Subsection 110.6(1) - Qualified Small Business Corporation Share undivided interests in SBC shares on s. 98(3) winding up could qualify as shares of QSBC shares

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