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.
June 2, 1993
| Ottawa District Office |
Head Office |
| P. Middlestead |
Financial Industries Division |
| Director |
D.S. Delorey 957-8953 |
Attention: Pat Lesperance
Client Assistance
Executive Employment Transition Policy Lump Sum Financial Settlement
This is in reply to your Round Trip Memorandum of April 20, 1993 concerning the tax status of a lump-sum amount that an employee may receive under the Executive Employment Transition Policy.
We previously processed a similar enquiry from the Management Programs Division of the Department. The Director of that Division informed us that the lump-sum amount may consist of some or all of the following:
Payment in lieu of unfulfilled up to 52 weeks salary surplus period
Payment in lieu of foregone up to 15% of salary benefits
Payment to compensate for up to 30% of salary pension reduction
In our reply of February 23, 1993 to the Management Programs Division, we confirmed that the lump-sum amount would be considered a retiring allowance for the purposes of the Income Tax Act and that the employer may spread the payment of the amount to the employee over an unrestricted period of time.
for DirectorFinancial Industries DivisionRulings DirectorateHAA 4749-3
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© Her Majesty the Queen in Right of Canada, 1993
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© Sa Majesté la Reine du Chef du Canada, 1993
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