13 July 1983 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.

XXXX

105

W.B. Baumeister

Attention XXXX Supervisor

July 13, 1983

Dear Sirs:

Your letter of May 13, 1983 addressed to the Pension and Profit Sharing Plans Section of our Department, has been forwarded to this Division for consideration and reply.

XXXX in accordance with paragraph 6(j) of Information Circular No. 72-13R7, dated December 31, 1981.

Although it is not the practice of our Department to enforce the payment of Part XI tax payable by a foreign trust governed by a registered pension plan In respect of its Investment in foreign property as defined in subsection 206(2) of the Act, the foreign trust will still be required to calculate its tax payable in accordance with subsection 206(1) of the Act and to file annually a completed copy of the Employees' Pension Plan Information Return and Income Tax Return, Form T3P.

We advise that taxes payable by foreign trusts governed by registered pension plans will not be remitted automatically. Instead, foreign pension trusts would have to make individual requests for an order of remission to the Tax Policy and Legislation Branch of the Department of Finance, since that Department would be taking the initiative in recommending any remission in the particular circumstances of registered pension plans that have a foreign funding medium.

However, we should inform you that some time ago a request for an order of remission of taxes in similar circumstances was refused by the Department of Finance on the grounds that, because the provisions of the Income Tax Act dealing with Employee Benefit Plans apply to non-registered pension plans, pension plans which have a foreign funding medium could, in the view of the Department of Finance, be operated as Employee Benefit Plans and need not be registered as pension plans under subsection 248(1) of the Act.

XXXX

Yours truly,

for Director Non-Corporate Rulings Division

WEB: ta

File 206

248(1) "Registered pension fund or plan" "Employee benefit plan"