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 R. B. Day (613) 957-2136
FEB 9 1988
Dear Mr. XXXX
We are writing in response to your letter of December 8, 1987, wherein you requested our views as to whether subsection 80.4(6) of the Income Tax Act (the "Act") would apply to a situation where an employee home purchase loan is given to an individual employee on a demand basis and which remains outstanding beyond five years from the day on which the loan was received by the employee.
It is our opinion that where no demand for full payment is made on a demand note for a period in excess of five years then such a loan has a term for repayment exceeding five years. The loan would then be deemed to be a new loan by virtue of subsection 80.4(6) of the Act and would be affected by the prescribed rate of interest in effect at the time it is deemed to be a new loan.
The above comments are based on the limited information set out in your letter, and as such, are not binding upon the Department.
Yours truly,
ORIGINAL SIGNED BY ORIGINAL SIGNÉ PAR ROBERT H. JOYCE
for Director Small Business and General Division Specialty Rulings Directorate Legislative and Intergovernmental Affairs Branch
All rights reserved. Permission is granted to electronically copy and to print in hard copy for internal use only. No part of this information may be reproduced, modified, transmitted or redistributed in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, or stored in a retrieval system for any purpose other than noted above (including sales), without prior written permission of Canada Revenue Agency, Ottawa, Ontario K1A 0L5
© Her Majesty the Queen in Right of Canada, 1988
Tous droits réservés. Il est permis de copier sous forme électronique ou d'imprimer pour un usage interne seulement. Toutefois, il est interdit de reproduire, de modifier, de transmettre ou de redistributer de l'information, sous quelque forme ou par quelque moyen que ce soit, de facon électronique, méchanique, photocopies ou autre, ou par stockage dans des systèmes d'extraction ou pour tout usage autre que ceux susmentionnés (incluant pour fin commerciale), sans l'autorisation écrite préalable de l'Agence du revenu du Canada, Ottawa, Ontario K1A 0L5.
© Sa Majesté la Reine du Chef du Canada, 1988
Email this Content