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.
| |
February 14, 1990 |
| Registration |
Financial Industries Division |
| Charities Division |
M.M. Trotier |
| Ron Porteous |
957-8957 |
| |
File No. 7-4626 |
Subject: Universal Life Policies 24(1)
Following your telephone conversation on February 9, 1990 with Michele Trotier of our Directorate, this is to confirm our response to your query of January 3, 1990 as to whether gifts of "universal life" policies can qualify as charitable donations as described in Interpretation Bulletin IT-244R2.
Notwithstanding the IT only refers to "term" and "whole life" policies, we are of the view that a transfer of or payments of premiums in respect of such policies could qualify as charitable donations where there has been an absolute assignment of the policy to the charity and where no right, privilege, benefit or advantage can accrue to the donor as a result of the gift. However this is a question of fact, that can only be determined after consideration of the circumstances of a particular situation.
Whether or not a charity is willing to accept an interest in such a policy as a charitable donation, where it otherwise qualifies, may depend on the implications that such a policy may have, inter alia, on the computation of the disbursement quota of the particular charity. We understand that this issue has recently been raised by a taxpayer with our Services, Public Utilities and Exempt Corporations Section (Ernie Wheeler, Chief 957-2100).
We trust that the above comments will be of assistance.
ChiefFinancial Institutions SectionFinancial Industries DivisionRulings Directorate
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