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.
5-9857
A.B. Adler
(613) 957-8962
April 4, 1990
Dear Sirs:
This is further to our letter of March 21, 1990 and the telephone conversation between 19(1) and Mr. Adler on March 30, 1990, concerning a designation under subsection 104(13.1) of the Income Tax Act ("Act").
We have concluded from our review that where the income beneficiary of a trust has agreed to bear the burden with respect to the trust's taxes arising from a subsection 104(13.1) designation, the withholding of such taxes from the payment made to the beneficiary will not, in and by itself, result in a contribution of property to the trust for the purposes of subparagraph 108(1)(i)(ii) of the Act provided that the withheld amount relates to the income paid or payable to the beneficiary.
We trust that our comments will be sufficient for your purposes.
Yours truly, for Director Financial Industries Division Rulings Directorate
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