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.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
941487
XXXXXXXXXX S. Leung
Attention: XXXXXXXXXX
November 10, 1994
Dear Sirs:
Re: The Helmut Swantje Court Case
This is in reply to your letter of June 3, 1994 wherein you requested our view on the following matters in view of the recent Tax Court of Canada (Informal Procedure) case Helmut Swantje v. Her Majesty The Queen:
- Whether the Department accepts the decision of the lower court; and
- Whether the Department considers the tax levied under Part I.2 of the Income Tax Act (the "Act") to be a tax described in paragraph 3(a) of Article II of the Canada-U.S. Income Tax Convention (the "Convention").
As discussed on the telephone with you on June 15, 1994, the Swantje case is under appeal. Consequently, we are not following the lower court decision at this time.
With respect to the application of the Convention, it is our view that the tax levied under Part I.2 of the Act is a recovery of Canadian social benefits. It is not a tax on foreign source pension income and is, therefore, not levied in contravention of the Convention.
Yours truly,
for Director
Reorganizations and Foreign Division
Rulings Directorate
Policy and Legislation Branch
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© Her Majesty the Queen in Right of Canada, 1994
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© Sa Majesté la Reine du Chef du Canada, 1994
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