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.
April 16, 1980
BY HAND
Mr. R.N. Godwin, Assistant Director, Current Amendments Division, Revenue Canada Taxation, Metcalfe Building, 88 Metcalfe Street, Ottawa, Ontario.
Dear Bob:
Some time ago you wrote to me concerning the one acre restriction contained in the definition of a principal residence. You asked whether our department considered an exemption for 10, 15, 78 or 158 acres as allowed in the cases cited as acceptable in tax policy terms.
It is my view, in light of the varying circumstances in which a residence could be located in Canada and the different restrictions that may apply in each case. (e.g. municipal by-laws, geographical limitations), it is not appropriate to specify a maximum acreage in the legislation. Rather the present definition allows flexibility in determining the reasonableness of each case on an individual basis.
Quite apart from the fact that one acre of land in the inner city - for example, in Rockcliffe Village, may be considerably more valuable, than 10 or 20 acres in the interior of B.C., any legislation stipulating a maximum would soon be interpreted as a minimum. Further any such legislation would, no doubt, be viewed as an infringement of life style.
In examining the cases cited, I am, however, concerned that in one case there were 158.51 acres and four sleeping cabins in what was called a "principal residence". It seems anomalous that four cabins "at various locations on the property" would be included with a main residence as one "principal residence". An appeal on this issue may be the preferable route to follow at this time.
Yours sincerely,
Director, Tax Policy-Legislation.
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