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.
Re: Canada-United States Income Tax Convention, 1980 (the “Convention”) - U.S. Estate Tax
This is in reply to your letter to the Non-Resident Taxation Division dated October 16, 1990 whereby you requested the Department's opinion as to whether Article XXIII of the Convention applies to United States estate tax so as to reduce or eliminate such tax payable by the estate of a Canadian resident.
It is our understanding that United States estate tax is not a tax on capital and that Article XXIII of the Convention is not applicable thereto. Our understanding is consistent with the Technical Explanation of the Convention concerning Article II (Taxes Covered) and Article XXIII (Capital) and the Commentary on Article 22 of the OECD Model Double Taxation Convention on Income and Capital as set forth in the Report of the OECD Committee on Fiscal Affairs 1977.
It should be noted that Canada has no authority in connection with the administration and enforcement of the United States estate tax and that our opinion in connection therewith would not be binding on the United States. Accordingly, you may wish to consult with the United States Internal Revenue Service.
We also bring to your attention that negotiations are ongoing between Canada and the United States concerning amendments to the Convention and that Canada has raised the application of the United States estate tax to Canadian residents as one of the issues for discussion and negotiation. However, it is impossible at this time to predict what the outcome of such negotiations will be.
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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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