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.
Subject: Application of Article XXVII, Paragraph 2 of the Canada-United Kingdom Income Tax Convention (the "Convention") to Capital Gains Your File No: 19023
This is in reply to your Memorandum dated January 18, 1991.
We are of the opinion that Paragraph 2 of Article XXVII of the Convention does not apply to capital gains.
There is long standing judicial precedent (particularly in the law of trusts) both in Canada and in the United Kingdom distinguishing between income and capital gains and holding that a capital gain is not income. Furthermore, the Convention refers to income and capital gains (i.e. gains) separately and thus recognizes and maintains the distinction between the two.
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© Her Majesty the Queen in Right of Canada, 1991
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© Sa Majesté la Reine du Chef du Canada, 1991
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