10 February 1986 Income Tax Severed Letter

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.

February 10, 1986 Mr. Vance Sider Director General Corporate Rulings Revenue Canada Taxation 875 Heron Road Ottawa, Ontario K1A OL8

Dear Mr. Sider:

We are writing with respect to our conversations in early December, 1985 concerning the application of Article XXVIIA of the Canada-United Kingdom Income Tax Convention (the "Treaty"). We request your commentary and/or technical interpretation on the following situation on the application of exemption from Canadian income tax under the Treaty.

The pertinent facts surrounding this situation are as follows:

XXXX

The area in which we would appreciate your comments relates to the interpretation of "any 12 month period". In discussions with officials of Revenue Canada several years ago (shortly after the introduction of this article under the first Protocol to the Treaty) both in Ottawa and in Halifax, it was suggested, or insinuated, that the "12 month period" probably referred to the calendar year, or possibly the fiscal year of the non-resident. We feel that either of the above would be a correct interpretation, but are concerned that a "12 month period" might be interpreted as a period other than the calendar year or fiscal period.

In the case at issue, XXXX

We would suggest that the U.K. Company should be entitled to exemption under paragraph 3 of Article XXVIIA of the Treaty with respect to each of the periods of operation in the Canadian offshore, either on the basis of calendar year or fiscal period.

We would appreciatee your comments on the foregoing, and if you require further information or wish to discuss this matter further, please contact the undersigned.

Yours very truly,

XXXX