Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Principal Issues: Whether an assessment under subsection 159(3) would enable the Minister to reassess a statute-barred year?
Position: No.
Reasons: The purpose of an assessment under subsection 159(3) is to enable collection of an amount owed by an estate. Furthermore, the legal representative is a person separate from the estate and an assessment under subsection 159(3) is not tied to the normal reassessment for assessing an estate.
XXXXXXXXXX 2011-039473
Lindsay Frank
(613) 948-2227
Attention: XXXXXXXXXX
May 26, 2011
Dear XXXXXXXXXX :
Re: The Effect of a Subsection 159 Assessment
This is in reply to your inquiry as to whether the liability under subsection 159(3) of the Income Tax Act (the "Act") would enable the Minister to reassess a statute-barred taxation year of the estate of a deceased taxpayer.
The Minister may, pursuant to subsection 159(3), assess a legal representative at any time. The purpose of such an assessment is to facilitate collection of an amount owed by an estate, when a legal representative distributes property under his or her control without first obtaining a clearance certificate or posting acceptable security.
The legal representative is a separate person from the estate and the timing of an assessment under subsection 159(3) is not tied to the normal reassessment period for assessing an estate. Moreover, neither subsection 152(4) nor the normal reassessment period defined in subsection 152(3.1) applies to an initial assessment under subsection 159(3).
Should you have any questions or require additional information, please do not hesitate to contact Lindsay Frank at the number provided above.
B.J. Skulski
Manager
Insolvency and Administrative Law Section
International and Trusts Division
Income Tax Rulings Directorate
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