11 February 1991 Internal T.I. 9034947 F - Whether Advance Payments on Crops Could be Considered Loans

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.

7-903494

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This is in reply to your memorandum of November 27, 1990 addressed to Audit Application Division requesting comments on whether advances from the above could be considered to be loans by virtue of the operation of

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It is set out on page 7 of the Farming Income Tax Guide for 1989 that," under the Advance Payments for Crops Act... producers of various crops are eligible to receive advance payments on crops stored in their own names from their respective producers' associations" and these advances are considered loans.  Although apples are one of the crops eligible under this program

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it is a question of fact whether advances are received under the above Act and it appears that this is not the case.  Therefore, it is our view that the advances in question do not qualify as loans under this legislation

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As indicated in the 1989 T1 Guide, taxpayers may request changes to their tax returns within three years from the date the returns were first assessed by writing to the office of Revenue Canada, Taxation specified in the Guide.  We suggest that if the growers want to amend their returns for 1989, they follow this procedure.

We trust our comments will prove helpful.

for DirectorBusiness and General DivisionRulings DirectorateLegislative and Intergovernmental Affairs Branch

c.c. Audit Applications Division