21 November 1996 External T.I. 9635395 - RRSP PROPERTY TRANSFER

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:

What is the value at which to record a direct transfer of assets from one RRSP to another?

Position:

No disposition or acquisition occurs where there is a transfer of all the property of an unmatured RRSP from one trustee to another pursuant to 146(16). The property is transferred at cost where all the property is transferred and the annuitant is the same.

Reasons:

Standard position.

									5-963539
XXXXXXXXXX							Franklyn S. Gillman

Attention: XXXXXXXXXX

November 21, 1996

Dear Sirs:

Re: Paragraph 146(16)(a) of the Income Tax Act (the "Act")

This is in reply to your letter dated October 22, 1996, concerning the value at which to record a direct transfer of assets from a registered retirement savings plan ("RRSP") to another RRSP pursuant to paragraph 146(16)(a) of the Act.

Generally speaking and in the absence of specific provisions governing the transfer of property between those trusts described in section 205 of the Act, subsection 206(4) of the Act would apply to require the costing of property at fair market value.

It is the Department's view that for purposes of subsections 206(1) and (2) of the Act, provided that there is no change of annuitants, no disposition or acquisition occurs where there is a transfer of all the property of an unmatured self-administered RRSP from one trustee to another pursuant to subsection 146(16) of the Act. This situation is described in paragraph 12 of Interpretation Bulletin IT-412R2 (copy enclosed). This position does not extend, however, to any other transfer of property between trustees of RRSP's.

These opinions are our best interpretation of the law as it applies generally. They may, however, not always be appropriate in the circumstances of a particular case. As stated in paragraph 21 of Information Circular 70-6R2 written opinions are not advance rulings and, accordingly, are not binding on the Department.

We trust these comments will be of assistance.

Yours truly,

for Director
Financial Industries Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch

enclosure

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