27 February 1992 Income Tax Severed Letter 9200415 - Periodic Pension Payments

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.

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department. Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.

Subject: PERIODIC PENSION PAYMENTS Section(s): ART XVII OF CANADA -
U.S. TREATY]

• 5- 920041 M.P. Baldwin (613) 957-8953

XXX

Attention: XXX

February 27, 1992

Dear Sirs:

Re: Retiring Allowance subject to Article XVIII of the Canada-U.S. Tax Treaty

This is in reply to your letter of December 20, 1991 requesting our opinion on whether or not a retiring allowance paid to a U.S. resident over a period of 24 months would qualify as periodic pension income for purposes of Article XVIII, paragraph 2 of the Canada-U.S. Treaty.

As stated in paragraph 2 of Interpretation Bulletin IT-337R2 " Retiring allowance is defined in subsection 248(1) to mean an amount (other than a superannuation or pension benefit, and, after November 12, 1981, an amount received as a consequence of the death of an employee) received upon or after retirement from an office or employment in recognition of one's long service or in respect of a loss of office or employment".

As, by definition a retiring allowance can not include pension income, it would not qualify as periodic pension income for purposes of Article XVIII, paragraph 2 of the Canada-U.S. Treaty.

We trust the above comments will be of assistance to you.

Yours truly,

for Director
Financial Industries Division
Rulings Directorate
Legislative and Intergovernmental
Affairs Branch