29 April 1981 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.

B.W. Dath (613) 995-0051

XXXX

April 29, 1981.

Dear Sirs:

This is in reply to your letter of April 2nd concerning the taxation of amounts received from an employee benefit plan and superannuation or pension benefits.

You have outlined the situation where a citizen of the United States immigrates to Canada and commences to receive superannuation or pension benefits attributable to services rendered within the United States while he was a resident of that country.

Superannuation or pension benefits received by a Canadian resident from a foreign source are taxable under subparagraph 56(1)(a)(1) of the Income Tax Act unless exempted by a tax convention. The Canada/U.S. tax convention in force does not provide this exemption and therefore subparagraph 56(1)(a)(i) would be applicable in the above situation.

In our view subparagraph 56(1)(a)(i) is applicable to superannuation or pension benefits received out of or under an employee benefit plan and excluded under subparagraph 6(1)(g)(iii). However, subparagraph 56(1)(a)(i) does not tax amounts excluded under subparagraph 6(1)(g)(ii). You will note that subsection 6(10) provides a calculation to determine the amount contributed to an employee benefit plan.

Yours truly,

for Director