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.
Principal Issues:
Whether spouse who renounced any interest in matrimonial home owned by husband can withdraw amount under Home Buyers' Plan.
Position:
No.
Reasons:
Renunciation of rights not sufficient - must not live in husband's home in order to still be eligible under Home Buyers' Plan.
XXXXXXXXXX 963500
October 29, 1996
Dear XXXXXXXXXX:
Re: Home Buyers' Plan
This is in reply to your letter of September 26, 1996, forwarded to us by the Ottawa Taxation Centre. You ask whether your wife is eligible to withdraw an amount from her registered retirement savings plan under the Home Buyers' Plan.
We are unable to confirm the tax consequences concerning a proposed transaction except in the context of a request for an advance income tax ruling submitted in accordance with Information Circular 70-6R2. We can provide the following general comments which are not binding on the Department.
In accordance with the definition of "eligible amount" in paragraph (d.1) of subsection 146.01(1) of the Income Tax Act, an individual is unable to withdraw an amount under the Home Buyers' Plan if the individual had an owner-occupied home in a certain period preceding the withdrawal. The period commences at the beginning of the fourth calendar year preceding the year of withdrawal and ends 31 days before the day of withdrawal.
Even where the individual did not have an owner-occupied home in that period, an amount will not be eligible for withdrawal if the individual's spouse had an owner-occupied home in the period and during the period the individual inhabited that home during the spouse's marriage to the individual.
To conclude, the fact that the individual had neither legal nor equitable title to the spouse's home during the marriage and waived any claim to an interest in the home under a prenuptial agreement is not sufficient; to satisfy the requirements of the Home Buyers' Plan, the individual must not reside in the spouse's home during the marriage. This information is contained at page 10 (second paragraph) and page 11 (Step 3) of the booklet Home Buyer's Plan - for 1995 Participants, a copy of which is available at your local tax services office.
We trust our comments will be of assistance to you.
Yours truly,
for Director
Financial Industries Division
Income Tax Rulings and
Interpretations Directorate
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