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: Stock Appreciation Rights ("SAR") Cash in Lieu of Shares
This is in reply to your letter of March 27, 1991 concerning the above-mentioned subject.
It is the Department's opinion that, if the employees elects to receive the SAR value in cash, the amount so received would be included in his income for that year pursuant to paragraph 7(1)(b) of the Income Tax Act (the "Act"). It is also the Department's view that the wording of paragraph 110(1)(d) of the Act provides for a deduction in respect of cash payments received in lieu of shares where the provisions of said paragraph are otherwise met. Paragraph 7(3)(b) of the Act would not be applicable to deny a deduction in computing the income of a corporation in respect of such a cash payment.
The above is an expression of opinion and is not a binding ruling.
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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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