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.
Dear Sirs:
Re: Application of Subsection 70(2) to Compound Interest on Canada Savings Bonds
This is in reply to your letter of June 5, 1990, wherein you requested our opinion on the application of subsection 70(2) of the Income Tax Act as it applies to a compound interest Canada Savings Bond (CSB) on the death of a bondholder.
In our view, interest earned on a compound interest CSB up to November 1 preceding the date of death of a bondholder is considered to be a "right or thing" for the purposes of subsection 70(2) and (3) of the Act, to the extent that the amount was not included or required to be included in the deceased's income for the year or a preceding year.
Interest accruing from November 1 to the date of death is considered to be an amount referred to in paragraph 70(1)(a) of the Act and therefore not eligible for inclusion in a separate return under subsection 70(2).
We Trust our comments will be of assistance to you.
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© Her Majesty the Queen in Right of Canada, 1990
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© Sa Majesté la Reine du Chef du Canada, 1990
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