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.
| 24(1) |
File No. 900753 |
| |
D. Duff |
| |
(613) 957-3498 |
Attention: 19(1)
June 21, 1990
Dear Sirs:
This is in reply to your letter of May 8, 1990 regarding the naming of an inter vivos trust as the beneficiary of a term life insurance policy.
It is our opinion that a contribution, equal to the cost of the premiums, is made when the trust is named the beneficiary. In your example, if the premiums are paid by the parent, the grandparent could become disqualified as the settlor.
The subsequent payment of the life insurance proceeds to the trust, on the death of the parent, would not be considered to be a contribution.
We trust our comments will be of assistance.
Yours truly,
for DirectorFinancial Industries DivisionRulings Directorate
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