7 May 1975 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.

7th May, 1975

F.P. Padulo, Chief Programs and Operations Section, Source Deductions Division, Revenue Canada, Taxation, 875 Heron Road, Ottawa, Ontario KIA OL8

Your Ref.: 166 - 1-4 
           166 - 10-2
           166 - 8-73

Re: Transfer of lump sums from a Pension Plan to a Pension of an affiliated Company in another Country (U.K. in particular)

Dear Sirs:

We attach a copy of your letter to us dated 7.10.74 and one. from Mr. J.T. Youssef dated 30.9.75.

We also attach a copy of correspondence we have had from our U.K. operation which refers to the U.K. Inland Revenue's stand on such matters.

Is your ruling of 7.10.74 still in effect? Are you liable to be as generous as your U.K. counterparts in your treatment of such transfers some day?

Your further comments would be appreciated in order that I can reply to our U.K. office and notify our ever increasing number of clients who transfer Executives and Specialists between countries.

Our own advice to the clients presently transferring people abroad (permanently), is to enact a Reciprocal Agreement between the affiliates, and provide pension for all service in the 'assuming' Employers plan reducing the resulting pension by any pension being paid from the 'ceding' employers Plan (Tax conventions usually apply when pensions are payable).

However some clients wish to transfer assets in respect of such employees and provide the whole pension under the "assuming" Employers Plan either (1) according to such Plan for all service or (ii) for service only from the date of Transfer according to the "assuming" Employers Plan plus the amount of pension that can be bought by the transferred amount under the "assuming" Employers Plan.

Yours faithfully,